Loss of biodiversity and nature could put up to $31 trillion of cities' gross domestic product (GDP) at risk, according to research released Monday by the World Economic Forum.
More than 70 percent of the 576 biggest urban centers worldwide, comprising more than 1.4 billion people, are at elevated or extreme risk from environmental hazards like pollution, water contamination or extreme heat, according to the report. About $31 trillion of their GDP, or 44 percent, is at risk from these losses. Although this is below the global average of 50 percent, it would trickle down to other regions due to the numerous sectors that are headquartered in cities, such as utilities, transportation and shipping.
More specifically, the report identified flooding as the foremost natural risk for more than 1,600 cities worldwide. Loss of coastal habitat is a major contributor to this risk, according to the report. Like numerous risks from climate change and biodiversity loss, the poorest residents bear the greatest risk, with the World Bank estimating that the 600 million people most at risk are below the poverty line.
Air pollution and lack of green space in cities is also a major environmental risk and financial drain, according to the report. In southern and eastern Asia and the Pacific, exposure to air pollution cost the equivalent of 7.5 percent in regional GDP.
Urban centers represent more than 75 percent of carbon emissions worldwide, and the capital allocated for urban climate finance is far below the estimated amount necessary, according to the report. The 2021 State o Cities Climate Finance Report found $384 billion in climate finance went to urban areas in 207-2018, compared to an estimate of $5 trillion needed.
However, the report estimates that sustainable development in these areas could create enough jobs and capital to offset these risks. Sustainable transportation infrastructure alone could create 21.6 million jobs by 2030, according to the report, with another 11.66 million created by more sustainable handling of waste.
"In the conventional paradigm, urban development and environmental health are like oil and water," Akanksha Khatri, the World Economic Forum's Head of Nature and Biodiversity, said in a statement. "This report shows that this does not have to be the case. Nature can be the backbone of urban development. By recognizing cities as living systems, we can support conditions for the health of people, planet and economy in urban areas."