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Climate policy weakest in countries reliant on fossil-fuel income

28th June 2022 - Author: Daniel Jackson

The governments of Bangladesh, Malaysia, the Philippines, Chile, and Senegal are most strongly committed to prioritising climate when making public policy, according to new analysis by Oxford Analytica and WTW.

Climate ChangeCommitment on climate policy in the emerging world is strongest in countries most vulnerable to the impacts of global warming and in those with effective governments, but weakest in those reliant on fossil-fuel income.

The researchers found that countries which assign little to no weight to climate objectives are more likely to be politically unstable.

Stuart Ashworth, managing director and head of political risk for corporates at WTW, said: “Climate has always been a driver of political risk, and in extreme cases food and water are being weaponised for political reasons.”

“Understanding a country’s vulnerability to climate shocks will be increasingly important for investors. In Mali, Niger, and Burkina Faso, for instance, erratic weather patterns and rising global food prices are contributing to food insecurity in regions already prone to violence.”

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WTW’s one-to-five scale separates countries by the seriousness with which they take climate policy. Countries that rank only one (Libya, Turkmenistan, and Myanmar) assign little to no weight to climate objectives, and those that rank five (none of the 62 surveyed) prioritise climate above other key policy objectives.

The research by WTW identified three factors that correlate significantly with the ratings they assigned: vulnerability, state capacity and income from oil/gas.

Governments in emerging-world countries with greater vulnerability to the impacts of climate change appear to show greater commitment to policies such as emissions reduction.

Countries with a more effective civil service also appear to show greater commitment to climate policy.

And those with oil and gas income appear to show less commitment to climate policy.

Many Asian countries have a comparative strength in government effectiveness. On a regional average basis, Asian countries tend to have strong policymaking practices and effective bureaucracies capable of carrying out political goals.

Expert ratings for many countries in Africa came in above statistical predictions, including Cameroon, Central African Republic, the DRC, Ethiopia, Morocco, Mozambique, Uganda, and top-rated Senegal.

Sam Wilkin, Director of Political Risk Analytics at WTW, said “The novel ‘green development’ approaches being pursued by many African countries could serve as a model for the rest of the world”.

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