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Are you feeling the heat? Climate change in the Middle East poses a major threat to the economy

The region will be hardest hit by climate change. According to the IMF, the worsening climate in the region has cost annual economic growth by 1-2% per capita.

[Source photo: Anvita Gupta/Fast Company Middle East]

In Yemen’s capital Sana’a, you’re lucky if water comes out of your taps more than twice a week; in the industrial town of Taiz, it is only once a month. In rural areas, some women spend four to five hours a day collecting water, and girls never get an education because they are fetching water. People struggle daily to find or buy enough clean water to drink as the specter of a country running dry looms over its nearly 30 million inhabitants. What’s more, the lack of access to water has been responsible for Yemen recording the largest cholera outbreak in modern history when cases exceeded one million in 2017.

The water crisis spurred protests in Iran, and water has been the source of decades-long ethnic conflicts as countries pursue a strategy of weaponizing water supplies in the region. And it can be lethal, as the link between climate crises and social unrest due to climate migration has long been established. Meanwhile, permanent flooding threatens the region’s highly populated coastal cities such as Manama, Doha, and Kuwait City.

Countries are also becoming insufferably hotter. Last June, Kuwait recorded a temperature of 53.2 degrees Celsius, while the UAE recorded over 50 degrees. In July, Iran recorded a close of 51 degrees. 

We are kicking off this summer with searingly hot temperatures, new daily, monthly and all-time record highs will be set across the region, with millions of people sweating it out under heat warnings or advisories.

The Middle East is warming at twice the global average, and by 2050 will be 4 degrees Celsius warmer. That figure obliterates the Paris agreement’s goal for a global average temperature rise of 1.5 degrees mark prescribed to save humanity.

As awful as this exposition of risk sounds, this is just the beginning of climate change. With significantly low precipitation in the arid environment, and greenhouse gas emissions more than tripled in the region over the last three decades, the region is more vulnerable to climate change than any part of the world.

“We have already warmed our planet 1.1 degrees Celsius. To stay within the limit of dangerous climate change, we have .4 degrees remaining. We need to rapidly build resilience worldwide, and the Middle East is no different,” says Heather McGeory, Global Lead, Climate and Sustainability at APCO Impact. “The Middle East is already in challenging climates, and as the planet continues to warm, the region will experience further desertification, more frequent extreme heat days, water stress, and sea-level rise.”


There’s been a series of reports sounding alarms. The latest is the International Monetary Fund (IMF) paper stating the frequency and severity of extreme weather events are rapidly rising in the Middle East, posing a huge risk of rising climate-related losses to life and impeding economic growth in the region. The worsening climate change in the region has also cost annual economic growth by 1-2% per capita.

“Several regional impacts of climate change will affect the economies of the Middle East. Higher temperatures bring on more public health issues associated with heat-related illness and the ability to work outdoors. This affects the available labor force in critical sectors associated with public city services, infrastructure, and construction. In addition, exposure to heat increases the impacts to infrastructure – the reduced lifespan of physical assets and more frequent wear and tear,” says Mohammed Mahmoud, Director, Climate and Water Program at Middle East Institute. 

While there’s a global transition toward a net-zero economy, the Middle East, traditionally a major oil and gas producer, faces the medium-and long-term risks of getting left behind. “The current cycle of high oil & natural gas prices supports many countries in the Middle East. These price highs generate sharper views of new pathways — developing new oil & gas fields and low-carbon and renewables. The former builds back into history, and the latter builds into the future,” says McGeory.

“The Middle East risks building deeper into the fossil fuel economy and also has the opportunity to use its expertise as energy developers to scale green hydrogen – both as liquid fuel and for generating utility-scale energy for manufacturing, creating a new low-carbon economy.”

The IMF report, which stated that climate-related losses to life and property in the Middle East are set to worsen if the region fails to adapt to higher temperatures and extreme weather events, wasn’t the first report sounding an alarm that continues to resonate. A few years ago, the World Bank said extreme climatic conditions would become routine, and the region could face four months of scorching sun every year. The World Bank estimates that climate-related water scarcity will cost Middle Eastern nations between 6% and 14% of their GDP by 2050, due to water-related impacts on agriculture, health, and incomes. 

Climate change is only going to get worse in countries across the region. Like, way worse. “The encroachment of seawater on coastal areas with industrial, residential, and agricultural lands can disrupt those sectors due to relocation and new construction efforts. Higher temperatures will translate to more evapotranspiration, leading to higher irrigation requirements and more water use, thus impacting agricultural production. Enhanced warming conditions in the Indian Ocean and the Arabian Sea will produce more intense and frequent cyclones, leading to serious damages and fatalities,” adds Mahmoud.

Saudi Arabia has pledged to reach net-zero by 2060 and plans to adopt a circular carbon economy, including carbon capture and storage, direct air capture, and hydrogen and low-carbon fuels. The UAE also promises to invest more than $160 billion in renewable energy to meet net-zero by 2050.

But much more needs to be done. Kristalina Georgieva, Managing Director of the IMF, at the World Government Summit suggested that public infrastructure investment needs could amount to 3.3% of GDP per year for individual countries in the region over the next decade, more than twice the emerging market average. Countries must include climate adaptation policy in national economic strategies to ensure investments in resilient climate infrastructure such as flood protection to avert economic losses.

“National governments can start to redirect fossil fuel subsidies, create an enabling policy environment for zero-carbon transition, and raise green bonds,” says McGeory. “Sovereign wealth funds can step up their investments in zero-carbon businesses and technologies to support scaling green hydrogen, synthetic and sustainable fuels, direct air capture so that they reach commercial scale.”


Hotter cities could be catastrophic for urban public health, which is already suffering from increasing heat. Experts say exploring measures that allow the region to cope with the effects of climate change in parallel to the mitigation efforts that deal directly with the impending climate change is crucial. “This includes water augmentation strategies like cloud seeding and full urban water reuse; wastewater to drinking water treatment, and increase in water use efficiency applications and technologies in agriculture,” says Mahmoud, adding that adjusted work schedules for outdoor workers to minimize the impact of extreme heat days and events needs to be considered as well.

Undeniably, the gap between what is needed and what is on the table is shaky in climate finance. The public sector has lagged for years on its commitments, primarily because donor countries have failed to provide promised financing to emerging economies to support adaptation and resilience. “Creating enabling environments to welcome further investments from the private sector is critical. Investors want to be in policy environments that have credible and predictable sector-specific policies, targets, and transition plans. Aligning regulatory frameworks to net-zero will also hasten a transition towards net-zero and encourage investors to use climate risk disclosure as an investment tool,” says McGeory.

To make a dent, private adaptation actions can be much more efficient than the public sector. However, private sectors also face constraints: the availability of financing. Three key factors weigh on this – a lack of data on country-level climate risks and vulnerabilities to guide investment decision making; limited clarity on government investment gaps to achieve adaptation goals, and low perceived or actual returns on investment. This is a challenge in the region’s low-income countries, where communities largely depend on humanitarian funds to cope with climate risks. 

Things look grim, but all is not lost. The region can, though, brace the brutal heat that climate change is already delivering by reducing carbon emissions through more carbon sinks and carbon capture, efficiency enhancements in fossil fuel, and diversifying the energy portfolios of fossil fuel-heavy countries to include more renewables, especially solar.

“While certainly there are risks, the situation also presents opportunities for innovation. Reforestation, avoiding deforestation, and protecting mangroves, also called blue carbon, are critical components to building resilience and adapting to a changing climate,” says McGeory.


Suparna Dutt D’Cunha is the Editor at Fast Company Middle East. She is interested in ideas and culture and cover stories ranging from films and food to startups and technology. She was a Forbes Asia contributor and previously worked at Gulf News and Times Of India. More