| Climate risks assessment of Ireland’s economy and the policy implications for the Republic of Korea | |
| Climate risks assessment of Ireland’s economy and the policy implications for the Republic of Korea | |
| Phillips, Dafydd* and Jung, Tae Yong**† | |
| Phillips, Dafydd* and Jung, Tae Yong**† | |
| This paper compares Ireland’s physical and transition climate risk costs by estimating potential losses to properties through flood disaster damages in a scenario in which global greenhouse gas emissions continue to rise (RCP 8.5 scenario), as well as potential near-term financial losses to greenhouse gas emission intensive sectors in a disorderly short-term green transition scenario. The potential costs of physical climate risk in Ireland are calculated based on future flood risk estimates by region data obtained from the JBA Risk Management flood model, which estimates future flood risk to properties via geocoding in a RCP 8.5 scenario by region, combined with mortgage and property value data from banks operating in the Irish market. Estimates of Ireland’s transition risk costs are made with data from the European Central Bank’s 2022 climate risk stress test and loans based on sector data from bank financial statements. This study finds that Ireland faces significant physical and transition risks related to climate change. The near-term economic losses from a rapid green transition are estimated to be smaller than losses from climate change-induced physical risk related to increased flooding, thus providing support for the necessity of an orderly near-term green transition to mitigate the long-term threat of physical impacts from climate change. This study concludes by discussing policy implications for the Republic of Korea as the country shares various similarities with Ireland and also faces significant physical and transition risk costs. | |
| Transition risks, Financial stability, Physical risks, Flood disasters, Ireland | |
 140601-03.pdf | |
| 2093-5919 | |
| 2586-2782 | |
| 2023-12 |
