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Climate Change and Economic Growth in Africa: An Econometric Analysis

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  • Abidoye, Babatunde
  • Odusola, Ayodele

Abstract

The economic landscape of most African countries depends essentially on the dynamics of climate change. Key sectors driving their economic performance and livelihoods such as agriculture, forestry, energy, tourism, coastal and water resources are highly vulnerable to climate change. This article examines the empirical linkage between economic growth and climate change in Africa. Using annual data for 34 countries from 1961 to 2009, we find a negative impact of climate change on economic growth. Our results show that a 1°C increase in temperature reduces gross domestic product (GDP) growth by 0.67 percentage point. Evidence from sensitivity analysis shows the two largest economies in the Sub-Saharan Africa (Nigeria and South Africa) play a significant role in ameliorating the negative economic impact of climate change in the region. In addition to impact on Africa, this article provides estimates of the impact of climate change on GDP growth of these 34 countries, which can be valuable in appraising national adaptation plans.We do not find evidence that average long-run temperature changes affect long-run economic growth as measured by 5 year averages.

Suggested Citation

  • Abidoye, Babatunde & Odusola, Ayodele, 2015. "Climate Change and Economic Growth in Africa: An Econometric Analysis," UNDP Africa Economists Working Papers 307336, United Nations Development Programme (UNDP).
    • Handle: RePEc:ags:undpae:307336
    DOI: 10.22004/ag.econ.307336
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