Acclimatise’s special guidance report “Understanding Physical Climate Risks and Opportunities” is designed to help investors assess physical climate risk assessments to their portfolios.
Developed with the Institutional Investors Group on Climate Change (IIGCC), the guidance collates good practice for physical risk assessments across the stages of a typical risk assessment process. The guidance was published in June 2020. It was developed in close conjunction with IIGCC staff, leading investors, and Dr Rory Sullivan of Chronos Sustainability.
In this video, report author and Acclimatise consultant Robin Hamaker-Taylor talks through what the report covers.
That is why Ribena is investing £500,000 in a five-year project with the James Hutton Institute to develop a new variety of blackcurrant that doesn’t need a cold winter to deliver good summer fruits.
“We are seeing big shifts in our climate. We’ve had an incredibly mild winter, followed by the sunniest May ever, and the driest May in 124 years,” Ribena’s blackcurrant agronomist Harriet Prosser said. “That puts us in a really difficult position.”
Standard blackcurrant varieties need around 2,000 “cold hours” – when the temperature drops below 7C – before they start to bud in the Spring, Ms Prosser explained. The cold spell reduces the risk of frost damage to new buds, and ensures blackcurrant shrubs flower at the right point in the season for peak pollination.
But this year, blackcurrant growers in the UK’s South East saw just 1,300 “cold hours”, raising the risk of lower yields and an unevenly ripened crop.
Ribena is trying to manage Britain’s unpredictable weather patterns by sourcing blackcurrants from across the country, from Kent to Scotland. Its growers also use a range of varieties, including some better adapted to warmer climates.
But each year growing a bumper crop of blackcurrants in Britain becomes more of a challenge. This year Ribena resorted to using a specially developed nutrient-rich “energy drink” on the plants to encourage fruiting, Ms Prosser said.
Finding a blackcurrant that thrives in Britain’s warming winter conditions is crucial to the sector’s long-term prospects. “I think we would always work to keep British blackcurrants going,” Ms Prosser said. “It would get harder without this breeding programme.”
Acclimatise has taken the decision to remove its company page from Facebook. It has come to our attention that Facebook has included a loop-hole in its fact-checking program that allows non-expert staff members to overrule the judgement of climate scientists and make climate disinformation ineligible for fact-checking by classifying it as ‘opinion’. This has undermined the credibility of Facebook’s partnership with Science Feedback, to allow trained climate scientists to evaluate the accuracy of viral content.
We believe that Facebook is facilitating the spread of misinformation about climate change, which directly undermines Acclimatise’s mission to make the world more resilient to climate change and its impacts. As a company driven by its values, Acclimatise has a responsibility to take action on issues that cause harm to our staff, our environment and the wider community.
Facebook’s continued failure to stop the spread of misinformation and hate speech on its platform is also of great concern to us. This inaction fuels racism, violence, and may undermine democracy and the integrity of elections around the world.
We are deeply concerned that the company has named Breitbart News a “trusted news source” and made The Daily Caller a “fact-checker” despite both publications having deplorable values. In view of the dangerous misinformation about climate change and the conflict with our own values, we have decided to sign up to the Stop Hate for Profit campaign.
The pioneering infrastructure project to upgrade Washington DC’s combined sewer system used green infrastructure to reduce capital cost and build resilience to future flood risk. DC Water, the District of Colombia’s Water and Sewer Authority, adapted the $2.6 billion-dollar project to incorporate $100 million dollars of green infrastructure.
A new case study, produced by Acclimatise for The Resilience Shift, tells the story of DC Water’s journey to incorporate green infrastructure into such a large and important critical infrastructure project. From inventing the world’s first Environmental Impact Bond to finance the project, to delivering a jobs programme that allowed DC residents to maintain the green infrastructure, the Clean Rivers Project innovated at each stage of the development process.
DC Water, embarked on the Clean Rivers Project to managing combined sewer overflow events by implementing green infrastructure above ground, alongside grey infrastructure below ground, to help control the volume of water reaching the storm water drainage system. Like many older U.S. cities, DC has a combined sewer system. During heavy rainfall events the capacity of the combined system can be exceeded, resulting in combined sewage and stormwater discharge into DC’s river.
Phase one of the Clean Rivers Project in the Rock Creek Area of DC, includes implementing green infrastructure techniques such as bio retention (e.g. rain gardens) in curb extensions and planter strips, and permeable pavements on streets and alleys that will can manage the volume associated with 1.2 inches of rain falling on 365 impervious acres of land. Just as underground tunnels are designed to a given holding capacity, the green infrastructure was likewise designed to manage certain volume of rainfall.
The green infrastructure was financed by the first of its kind Environmental Impact Bond (EIB) where both the investors and DC Water, hedge the financial risks and share the benefits. If the green infrastructure performs better than expected at reducing storm water runoff, DC Water will make an outcome-based payment to the investors. If the green infrastructure underperforms at reducing runoff, the investors will make a risk-share payment to DC Water. If performance falls within the expected outcome range then neither party will make a payout.
The results of phase one are presently being monitored and evaluated to understand the green infrastructure efficacy to attenuate the stormwater, although are expected to deliver a range of benefits beyond reducing the occurrence of CSO events. This includes creating local employment opportunities through installation and maintenance, improving the micro-climate and building climate change resilience and reducing crime through greener communities.
This case study offers important insights to other municipalities struggling to manage CSO overflows, and shows how green infrastructure can be implemented, in partnership with other city programs, to achieve win-win measures. In particular, city planners, the water and sewage authority, environmental departments and organizations focused on urban regeneration, climate resilience and mitigation and more broadly environmental causes, can implement green infrastructure to achieve multiple objectives in tandem in a cost-effective way. The innovative financing approach can also be readily replicated in other context.
Agriculture and human civilisation began in the Fertile Crescent that runs from eastern Turkey to Iraq: cattle, sheep and goats were domesticated there; the first figs, almonds, grapes and pulses were planted there; the progenitors of wheat were sown there.
Cities were built, irrigation schemes devised, empires rose and fell. Greece colonised the Mediterranean, Rome later controlled it and set the pattern of law and civic government for the next 2000 years in Northern Europe.
Islamic forces brought a different civilisation to the Balkans, North Africa and almost all of Spain. The grain fields of the Nile Valley underwrote the expansion of the Roman Empire.
“What’s really different about the Mediterranean is the geography. You have a big sea enclosed by continents, which doesn’t really occur anywhere else in the world”
But the pressure of history is likely to be affected by the high pressure of summers to come. In a world of rapid climate change, the already dry and sunny enclosed sea will become sunnier and drier, according to two scientists from the Massachusetts Institute of Technology.
They report in the American Meteorological Society’s Journal of Climate that the winter rains that are normally expected to fill the reservoirs and nourish the rich annual harvest from the orchards, vineyards and wheat fields can be expected to diminish significantly, as atmospheric pressures rise, to reduce rainfall by somewhere between 10% and 60%.
Ordinarily, a warmer world should be a wetter one. More water evaporates, and with each degree-rise in temperature the capacity of the air to hold water vapour increases by 7%, to fall inevitably as rain, somewhere.
But episodes of low pressure associated with rain clouds over the Mediterranean become less likely, according to climate simulations. The topography of the landscape and sea determines the probable pattern of the winds.
High pressure grows
“It just happened that the geography of where the Mediterranean is, and where the mountains are, impacts the pattern of air flow high in the atmosphere in a way that creates a high-pressure area over the Mediterranean,” said Alexandre Tuel, one of the authors.
“What’s really different about the Mediterranean compared to other regions is the geography. Basically, you have a big sea enclosed by continents, which doesn’t really occur anywhere else in the world.”
Another factor is the rate of warming: land warms faster than sea. The North African seaboard and the southern fringe of Europe will become 3 to 4°C hotter over the next hundred years. The sea will warm by only 2°C. The difference between land and sea will become smaller, to add to the pattern of high pressure circulation.
“Basically, the difference between the water and the land becomes smaller with time,” Tuel says.
What is different is that the latest research offers detailed predictions of the nature of change, and identifies the regions likeliest to be worst hit. These include Morocco in north-west Africa, and the eastern Mediterranean of Turkey and the Levant.
“These are areas where we already detect declines in precipitation,” said Elfatih Eltahir, the senior author. “We document from the observed record of precipitation that this eastern part has already experienced a significant decline of precipitation.”
This article was originally posted on the Climate News Network.
Acclimatise are delighted to announce the establishment of a new partnership with Forum for the Future as co-delivery partners on the Cotton 2040 initiative.
To survive in an increasingly
climate-disrupted world, the cotton system requires significant, radical change
which can only be achieved by a systemic, collaborative approach involving
actors across the supply chain.
Cotton represents about 25% of
all fibre used in the textile sector globally and supports the livelihoods of
around 350 million people. The industry is facing increasing climate change
pressures include changing rainfall patterns, availability of water, rising
temperatures and competition for land for food and fuel.. Increasing the amount
of sustainably grown cotton is key to reducing cotton’s impact and
adapting to the negative impacts of the climate crisis; but while progress is
being made, uptake and production is limited, preventing sustainable
cotton from mainstreaming.
See a recently published blog by Forum for the Future’s Associate Director, Charlene Collison, on why we need to transform commodity value chains in light of the current pandemic and the on-going climate change threat.
About Cotton 2040
Facilitated by Forum for the Future and supported by Laudes Foundation, Acclimatise and Anthesis, Cotton 2040 aims to accelerate progress and maximise the impact of existing sustainability initiatives across the global cotton industry, by bringing together leading international brands and retailers, sustainable cotton standards, existing industry initiatives and other stakeholders across the value chain.
Since 2016, Cotton 2040 has been engaging the industry to understand and align around potential future risks and opportunities for sustainable cotton. The initiative’s progress to date includes building the CottonUP Guide to sourcing sustainable cotton, creating the first platform providing comprehensive information on sourcing cotton across multiple sustainable standards. Forum for the Future have also been carrying out foundational work with sustainable cotton standards, programmes and codes on pathways towards greater alignment in traceability and impact reporting (the latest phase of this work has been carried out in collaboration with Project Delta).
Cotton 2040’s progress has been
guided by a steering group that included sustainable cotton standards,
programmes and codes (organic, represented by Textile Exchange; The Better
Cotton Initiative (BCI); CottonConnect; Cotton Made in Africa (CMiA); Fairtrade;
MyBMP (Cotton Australia); and the Organic Cotton Accelerator (OCA). Brand and
retail partners have included M&S, Target, Aditya Birla Fashion and Retail
Ltd. and Burberry, among others, alongside industry partners such as IDH, ICAC
Over the next three years
(2020-2022), Cotton 2040 and its partners will deliver a set of three
interconnected workstreams with the biggest potential to drive a systemic
shift to mainstream sustainable cotton through collaborative efforts.
Acclimatise will co-partner the
delivery of the first of three workstreams planned for Cotton 2040. This first
workstream is related to planning for climate adaptation. The three workstreams
Planning for climate adaptation: Creating sector-wide collaborative action to understand and adapt to the changing climate. Working with cotton producers, brands and retailers and industry initiatives, we will develop a common understanding across the cotton system as to how climate change is likely to impact key stakeholders and regions, and agree on a shared set of priorities for action across the cotton sector.
Sourcing sustainable cotton: Driving the uptake of sustainable cotton with brands and retailers, building on the success of the CottonUP guide launched in 2018.
Developing sustainable business models: Supporting a widespread shift towards alternative business models which ensure fairer distribution of value and risk between stakeholders, and enable the regeneration of land and resources.
How to get involved?
Each partner involved in Cotton
2040 has joined in recognition that no one organisation or company can solve
the sector’s challenges alone. But we need many more to join – and more funding
to make the impact that is needed.
We are now inviting expressions
of interest and commitment from organisations wishing to contribute to one or
more of these workstreams in 2020 and beyond.
Those wishing to find out more can contact Charlene
Collison, Associate Director – Sustainable Value Chains & Livelihoods at
Forum for the Future on email@example.com
MinterEllison, a commercial law firm in the Asia-Pacific, has published new analysis which indicates that companies have not been prioritising their surveillance of their climate change risk disclosures. In their analysis of annual reports for the 2019 financial year, MinterEllison found that only 21 (7%) of ASX300 companies had ‘meaningful’ climate change risk disclosures, compared with 137 (45.5%) of reports containing little or none.
not bode well for many listed companies in light of the Australian Securities
& Investments Commission’s (ASIC) recent announcement that it will
prioritise this in the 2020 financial year. So how do boards assure themselves
that they are having meaningful climate change risk disclosures? To answer this
question, MinterEllison has set out their top 5 climate change-related
governance issues for directors to consider this reporting season.
Narrative disclosures – TCFD and stress-testing move from gold standard to base expectation
An increasing proportion of mainstream institutional investors now expect investee companies to apply the governance, strategy, risk metrics and disclosure framework set out in the 2017 Recommendations of the Bloomberg Taskforce on Climate-related Financial Disclosures (TCFD). One of the key TCFD Recommendations relates to stress-testing and scenario planning of business strategies against a plausible range of climate futures, emphasising the inclusion of information on the impact of climate change on financial performance, position and prospects.
Consider how your business has
made credible inroads on the journey towards compliance with the
Recommendations of the TCFD in FY20.
‘Net zero’ emissions transition
Mainstream investors and large
proxy advisors are increasingly voting in favour of activist shareholder
resolutions that seek corporate disclosure of net zero emission strategies –
often against the recommendation of management.
Consider how you envision your
business will continue to thrive in a ‘net zero’ economy, and your strategy for
transitioning your business.
…and a roadmap for achieving Paris Agreement goals
Bare pledges of ‘support for
Paris Agreement goals’ are not enough. In FY20, investors are looking for a roadmap
of short- and medium-term targets against which to assess a corporation’s net
zero transition commitment, and evidence of credible progress on that journey.
Consider your business plans
and their progression towards achieving emissions reduction commitments and
your strategy for achieving these goals.
Valuation and impairment – relevance of climate change-related assumptions to financial reporting and audit
Standard setters made clear that
they expect climate change-related assumptions to be clearly stated,
highlighting the potential to be a material accounting estimation variable,
impacting on asset useful lives, fair valuation, impairments and provision for
bad and doubtful debts.
What consideration has been
given to the climate-related variables that may materially impact on your
accounting estimates (financial position) and prospects?
Governance, executive remuneration and their relationship with climate change strategy.
Companies should benchmark their
governance of climate change strategy and risk management against the
recommendations of the TCFD and ensure that a portion of the discretionary
remuneration of relevant senior officers is linked to progress against the
business’ climate targets.
Consider your company’s
governance structures and if they are benchmarked against the TCFD.
Small businesses operating in the Caribbean are faced with constant challenges.
First, the challenges when operating from an island: you are in a remote and isolated location with limited natural resources; costs of production are high; transport costs are high; there are no economies of scale; and your domestic markets are quite small.
Second, trading policies are unfavorable to local producers. There is a high level of dependence on imported inputs (including fuel); a lack of diversity in the goods exported and in trading partners; and a rapid depreciation rate of some Caribbean currencies (such as the Jamaican dollar), which increases operational costs and reduces business competitiveness, both locally and internationally.
Third, access to finance – including finance for innovation and for relief – is very challenging. High interest rates, lack of collateral, and the burden of government (in terms of tax rates and bureaucratic inefficiency) are highly problematic.
Agriculture in the Caribbean has also been fundamentally shaped by the colonial legacy of plantation economies. There is a tendency in favor of export-oriented production, and the best arable lands have – and continue to be- allocated to major export crops such as sugar cane and bananas in large scale operations. This leaves only marginal – and hilly – areas for small-scale domestic production. These areas are generally under-utilized, many times due to farmers lacking the investment capital to clear and develop more land at their disposal, or to update their equipment and practices to increase land use efficiency.
And this is just the top of the iceberg.
Climate change, a threat multiplier
Add to this reality climate change: A threat multiplier capable of generating new and amplified perils to a group of actors that are already in relentless struggle for survival. Analysis of observed meteorological records show a warming and drying trend across the entire region as well as an increase in tropical storms (especially for hurricanes category 4 and 5). In the future, the Caribbean region is expected to experience further erratic rainfall, higher temperatures, stronger droughts and greater climate variability.
Multiple effects on agricultural systems emerge from these changing conditions. In particular, changes in temperature and in rainfall patterns and diversion from favorable agro-climatic conditions can hinder farming productivity, lowering yields and the quality of the produce. Increase intensity of hurricanes and tropical storms can increase the incidence of coastal and riverine flooding and expose assets to high wind speeds. These hazards can generate damages to infrastructure and equipment, making it difficult to undertake farm operations and reach markets; and it can also impact on communities and labour force.
But it is not just farmers that are exposed to the challenges generated by these changing conditions. When we take a whole value chain approach, we can see that climate change generates differentiated risks along all tiers of a value chain, depending on the resources and activities needed to carry value chain operations. To illustrate this point, Figure 1 below shows the different actors, resources and activities along the cassava value chain in Jamaica and some of the key associated climate hazards that each tier is exposed to.
Strategically relate to better adapt
New forms of innovation aligned with the socio-economic and climate realities of the Caribbean are therefore needed. It is herein that a relational approach to climate adaptation can be most beneficial.
As a form of soft innovation, relationship building and strengthening can help actors in agri-business reach critical resources – such as finance and information – helping to increase their adaptive capacity. My research also finds that business relations affect actors’ ability to share or transfer climate risks, making businesses more or less susceptible to adaptation actions taken by others and granting businesses greater or lower flexibility when responding to climate hazards. These dynamics can alter businesses’ perceptions and attitudes towards climate risks and their adaptive responses. In addition, effective relationship management can increase value chain flexibility, visibility and agility, strengthening the overall resilience of agricultural value chains and their capacity to withstand and respond to external shocks, including climate hazards.
When thinking about barriers to climate adaptation, a key challenge that SMEs face is their ability to engage in and benefit from open innovation processes. Due to their size and financial capabilities -which restrict resource allocation for in-house R&D- SMEs are more reliant on open innovation processes than larger firms, and also perform it more intensively. However, SMEs ability to engage in open innovation processes is not only reliant on SMEs internal organisational learning capabilities: It also depends on their capacity to build collaborative relationships with counterparts in order to unlock access to new inflows of knowledge, and on the overall levels of inter-organizational knowledge and innovation openness of the broader business network.
What is the role of government in promoting relational adaptation?
Governments can formulate adaptation strategies focused on stimulating and incentivizing relational innovation, i.e. innovation that occurs through the establishment of new relationships or the re-structuring of existing ones. They can promote the development of cooperatives, business associations and industry clusters, as these networks facilitate information flows between agribusiness and support the dissemination of adaptation best practices. In order to help reduce the current R&D investment gap, strategies can also promote the development of linkages between universities and value chain actors. If done effectively, these network developments can help to reduce the burden on government extension services, as actors can then access information and training through others.
Moreover, business networks improve collaboration, information sharing and joint problem solving. They also help developing shared values and beliefs among businesses, and promote the creation of a shared risk management culture, which are thought to increase value chain climate resilience. There is therefore scope for governments to provide support and allocate resources to the formation, expansion and maintenance of business associations and industry clusters, as they can directly enhance the capacities of businesses to respond to climate risks.
Government and development agencies lacking the resources to promote harder (i.e. more technologically driven) forms of adaptation, may see the promotion of relational innovation as an interesting avenue to promote adaptation. As a form of soft adaptation, supporting relationship building could complement existing adaptation strategies in agriculture whilst easing the burden of government activities.
An enabling environment that promotes adaptation through relational innovations grants greater agency and responsibility to value chain actors. In other words, governments can help framing the conditions for the development of a network structure that facilitates exchange and interaction, but that relies on actor’s abilities to develop and manage relationships effectively. Thus, whilst businesses can directly seek to increase their adaptive capacity by building strategic relationships, governments and development agencies can also play a role in facilitating the development of an enabling environment for relationship building.
This article is based on the research studies carried by Laura Canevari at King’s College London. Free access to peer reviewed publications available below.
Canevari-Luzardo, L. (2019). Climate change adaptation in the private sector: application of a relational view of the firm. Climate and Development. doi:10.1080/17565529.2019.1613214[
Canevari-Luzardo, L., Berkhout, F., & Pelling, M. (2019). A relational view of climate adaptation in the private sector: How do value chain interactions shape business perceptions of climate risk and adaptive behaviour? Business Strategy and the Environment. doi: https://doi.org/10.1002/bse.2375
Canevari-Luzardo, L. M. (2019). Value chain climate resilience and adaptive capacity in micro, small and medium agribusiness in Jamaica: a network approach. Regional Environmental Change. doi:10.1007/s10113-019-01561-0
Parks, green spaces and plant-covered hills are an effective defence against storm surges and tsunamis according to a Stanford University study. The research concludes that carefully engineered green infrastructure can offer similar levels of protection as large seawalls, while also benefiting for marine and coastal biodiversity, the aesthetic environment, and reducing costs.
The study, published on 4th May in the journal Proceedings of the National Academy of Sciences, quantified how tsunami waves of different heights interact with structures of various sizes and shapes at the coast. The research calls into question the wisdom of conventional approaches to coastal storm management, which are dominated by hard infrastructure development such as construction of large seawalls.
Seawalls have many disadvantages. They are expensive and inflexible, so they are hard to adapt if, for example, sea levels rise by more than expected. They can also damage marine ecosystems, and damage local economies in sectors such as fishing or tourism.
“If the wall collapses, the consequences are life shattering,” said senior study author Jenny Suckale, an assistant professor of geophysics in the School of Earth, Energy & Environmental Sciences. “Seawalls can not only create a false sense of security that can discourage swift evacuations. They can also end up breaking apart into blocks of rubble that tsunami waves then toss throughout a city.”
“It’s sort of intuitive that the moment you see it as a threat, you build a
wall,” Suckale said. But while it’s true that seawalls can address some tsunami
risks, the factors that make a place livable can be far more complicated. Most
coastal communities want to maximize their well-being, not minimize their risk
at the expense of everything else,” she said. “Do you really want to live
behind a huge concrete wall because there is a small chance that a big tsunami
will hit you? Let’s put more options on the table and have an informed debate.”
Green infrastructure must be carefully designed
When considering alternatives to sea walls, the study found
that green infrastructure solutions needed to be carefully designed and well
built in order to deliver the desired levels of protection. The study notes
that while coastal forests offer protection against storm surges, it takes
decades for trees to grow large enough to offer robust protection, and they are
not viable in some areas where protection is most needed – such as to protect
vulnerable towns and cities.
The study noted that as much attention needs to be paid to the design and
engineering of green infrastructure as to conventional infrastructure
development. According to the study, vegetation alone, has little effect on an
incoming wave’s energy. However, plants play an important role in fighting
erosion, thereby helping to maintain the shape, height and spacing of hills and
mounds, which do offer significant protection.
Suckale says that to date, green infrastructure has been designed more for
aesthetics than for performance. “Our study shows that design matters. There’s
a wrong and a right spacing; there’s a wrong and a right shape,”
“You should not use aesthetic criteria to design this. Right now, our
designs are not strategic enough,” she said. “This paper is a starting point
for understanding how to design these parks to derive maximum risk mitigation
benefits from them.”
To test the efficacy of hills and mounds in providing coastal defences, the
researchers modelled what happens when a tsunami wave hits a single row of
hills. They found that mounds reflect and dampen a tsunami wave’s energy about
as well as a seawall. Hills were also found to perform equally well in the case
of a very extreme event – a one-in-a-thousand-year tsunami. As a result, the
study concluded that there is little extra value in combining hills with
Along with improving the design green infrastructure, the study also
recommends that more space should be given between urban development and the
water’s edge. The researchers note that homes and infrastructure should be set
back with a broad buffer zone between them and multiple staggered rows of hills
that are larger toward the shore and smaller inland.
European countries that avoid the most severe direct impacts of climate change themselves will not be spared economic damage from climate change, so suggests a new study. The report from the German Environment Agency (UBA), shows that the effects of climate change on countries outside of Europe, pose a much larger risk to Germany’s economy that climate impacts within Europe, because of international trade networks.
COVID-19 has demonstrated clearly the impacts that global systemic risk can have on individual countries’ economies. In a similar way, climate risks that affect one region will cause damage to economies around the world. Globalised trade networks mean that climate risks are therefore shared by all nations. The report’s findings are in line with similar studies from the United Kingdom and Switzerland.
“The effects of foreign trade alone are at least as significant as the economic consequences of climate change within national borders.” The study concludes. Germany and other EU nations, therefore stand to suffer indirectly from the impact of climate change outside the EU.
Countries and regions such as China, India, South and Southeast Asia, the Middle East and Africa are expected to see significant losses in welfare and GDP as a direct result of the impact of climate change on labour productivity, agricultural yields and sea levels.
“The purchasing power of the countries in these regions drops significantly compared to the reference trend without climate change, with considerable indirect negative consequences for Germany as a trading partner,” the study states.
The researchers note, however, that the transnational effects of global climate change cannot simply be cushioned by a general reduction in international trade relations. Such a move could not only lead to significant losses in prosperity in Germany, but also to a disruption in the worldwide production of goods and services and “networking that is central to the social and political stability of the world”, the researchers point out.
Instead, the study recommends that the resilience of the German economy “be improved through greater diversification or restructuring of global trade relations. This must be accompanied by targeted support for adaptation measures in the severely affected regions of the world, which are important for Germany in terms of supply and sales markets and are difficult to substitute”.