Climate change is increasingly a direct threat to growth trajectories in LMICs — particularly in sub-Saharan Africa, where rain-fed agriculture remains central to livelihoods and GDP. Drought, flooding, and the increasing frequency of extreme weather events impose immediate output losses and longer-term damage to productive capital.
Climate vulnerability interacts with other growth threats: it deepens fiscal rigidity (by creating recurrent emergency spending demands), increases debt pressure (through borrowing to respond to disasters), and compounds governance challenges in already fragile states.
How It Operates
Agricultural Productivity Shocks
Rain-fed agriculture in sub-Saharan Africa faces growing exposure to drought and irregular rainfall, with immediate impacts on food security and rural incomes.
Infrastructure Damage
Flooding and extreme weather events destroy productive infrastructure — roads, irrigation systems, energy networks — at a pace that outstrips repair capacity in low-income states.
Fiscal Pressure
Recurrent climate emergencies create unpredictable and growing demands on fiscal resources, crowding out development investment.
Policy Implications
- → Integrate climate risk into debt sustainability analysis and fiscal planning
- → Build social protection systems that can respond quickly to climate shocks without requiring new borrowing
- → Prioritise climate-resilient infrastructure investment in fiscal plans