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Enhancing Resilience to Climate Change in the Maldives
Author:
Mr. Giovanni Melina
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Marika Santoro null

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Series:
IMF Working Papers
Volume/Issue:
Volume 2021: Issue 096
Language:
English
Publication Date:
23 Apr 2021
DOI:
https://doi.org/10.5089/9781513582443.001
ISBN:
9781513582443
ISSN:
1018-5941
Pages:
21
Keywords:
IMF working paper Asia-Pacific; climate condition; climate resilience; adaptation infrastructure; disaster shock; Infrastructure; Natural disasters; Public investment spending; Private investment; South Asia
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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The increased likelihood of adverse climate-change-related shocks calls for building resilient infrastructure in the Maldives. Fulfilling these infrastructure needs requires a comprehensive analysis of investment plans, including with respect to their degree of climate resilience, their impact on future economic prospects, and their funding costs and sources. This paper analyzes these challenges, through calibrating a general equilibrium model. The main finding is that there is a significant dividend associated with building resilient infrastructure. Under worsened climate conditions, the cumulative output gain from investing in more resilient technologies increases up to a factor of two. However, given the Maldives’ limited fiscal space, particularly after COVID-19, the international community should also step up cooperation efforts. We also show that it is financially convenient for donors to help build resilience prior to the occurrence of a natural disasters rather than helping finance the reconstruction ex-post.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund