Acting on climate change is the new economic engine

€730 billion added to European economies in 2070.

There is evidence that the regions that take early and rapid action to establish green and low-emission production capabilities will be rewarded with more sophisticated and competitive economies in a low-emission world.

Europe is well-positioned to become the world’s first climate-neutral continent.

The cost of doing nothing is economically devastating

€6 trillion lost from European economies in the 50 years to 2070.

In this climate-damaged future, there could also be 110 million fewer jobs available in Europe’s economies over the next 50 years, a scenario that could diminish the region’s long-term economic prospects.

We have a narrow window of time to change the future. Now is the time to accelerate transformations across the European continent, to combat the worst impact and accelerate economic growth.

Source: Deloitte Economics Institute.

European economies have much to gain from action

With the right transition framework, Europe can move away from mounting climate damage towards new growth in a low-emissions economy. By getting started now, the continent can set the right direction, rate, and quality of growth to achieve an industrial revolution in the next 30 years. Not only can upfront coordination speed the path to net-zero, but it could ensure a supportive transition that eases the cost burden -and shares the benefits-of change with all economies on the continent.

European economies must accelerate progress

For decades, Europe has fought climate change across the continent and abroad. Yet global inaction and the ‘locked-in’ effects of climate change means the time has passed to start isolated transitions. It is now time to accelerate collectively. The cost of transitioning the European continent—which some have argued would be too high—is actually less than 0.7% of GDP each year to 2050. This is a small cost and one worth paying.

Yet even if Europe takes bold and collective action, it needs to be responsive to what’s going on in other parts of the world. That’s because the built-in assumptions about the outcomes of Europe’s decarbonisation depend on the efforts of all the regions of the world. This will require Europe to confront aspects of its regional politics that may otherwise impede regional cooperation.

Source: Deloitte Economics Institute.

• Bold Climate Plays – 2021 – 2025: Decisions begin to accelerate decarbonization at scale

• Accelerate to Zero – 2025 – 2035: Big economic shifts occur in policy, energy systems and consumer behavior

• The turning point – 2035-2050: Decarbonization of high-emission industries almost complete. Costs of sustainable technologies start decreasing and wider net economic gains

• Low-emission future – 2050 onwards: Radical transformation of economic structure. European economies near net zero emissions and operating in a world that keeps global warming to below 2°C.