Understanding the potential impact of Climate Change and Variability in Latin America and the CaribbeanCountries in Latin American and the Caribbean (LAC) are significantly affected by adverse consequences from climate variability and extremes, particularly the ENSO events. The Region’s economy is strongly dependent on natural resources linked to climate, and patterns of income distribution and environmental degradation are a constraint for adaptation and exacerbate the impacts for specific sub-regions, countries and populations. However, only 19% of the climate-related damage costs have been quantified for the period 2000-2005 accounting for 0.15% of GDP. Thus, actual average yearly costs could reach up to ?0.7% of GDP. Estimated damages due to warming by the 2050s vary from ?1.3% to 7% of GDP, suggesting that the impacts of projected climate changes are important enough to be taken into account in planning initiatives. Based on vulnerability and consumption indicators related to past and future global warming, the LAC region can be placed close to the world’s average indicating lower vulnerability within non-Annex 1 countries’ average. Vulnerability indices place Haiti, Bolivia, Honduras, Nicaragua, Ecuador, El Salvador, Belize, Paraguay, Guyana and the small Caribbean states as the most vulnerable countries. Focused primarily on LAC region and sub-regional scales, Section I describe summarily the potential direct impacts of climate change and variability on: Income, in terms of GDP generation, damages on infrastructure, and specifically on agriculture sector issues; human development, particularly related to human health; and, the environment, specifically biodiversity, water resources and coastal zones. Country-level relevant examples (i.e. climate-related disasters, past and current variability) and, particularly, the current situation in relation to economic, human and natural system indicators are given as to illustrate on the type of climate risks and the scope for and constraints to adaptation that the Region faces. This is mainly the approach in Section II. The considered sub-regions are named as follows: Brazil-Bz; Andean countries-AC; Rio de la Plata-RP; Mexico and Central America-MA; and the CaribbeanCb (fig. 1). Peer-reviewed literature; NationalnCommunications to the UNFCC; data-bases and reports were the sources for the present work. Section I - Future climate change. This section deals with the quantification of impacts linked to Increases in global average temperatures, 1°C - 6°C, and the associated sea level rise (SLR), changes in precipitation, and increase in extreme weather events. Socio-economic scenarios without climate change and expected climate changes are summarised in tables 1 and 2 respectively.Countries in Latin American and the Caribbean (LAC) are significantly affected by adverse consequences from climate variability and extremes, particularly the ENSO events. The Region’s economy is strongly dependent on natural resources linked to climate, and patterns of income distribution and environmental degradation are a constraint for adaptation and exacerbate the impacts for specific sub-regions, countries and populations. However, only 19% of the climate-related damage costs have been quantified for the period 2000-2005 accounting for 0.15% of GDP. Thus, actual average yearly costs could reach up to ?0.7% of GDP. Estimated damages due to warming by the 2050s vary from ?1.3% to 7% of GDP, suggesting that the impacts of projected climate changes are important enough to be taken into account in planning initiatives. Based on vulnerability and consumption indicators related to past and future global warming, the LAC region can be placed close to the world’s average indicating lower vulnerability within non-Annex 1 countries’ average. Vulnerability indices place Haiti, Bolivia, Honduras, Nicaragua, Ecuador, El Salvador, Belize, Paraguay, Guyana and the small Caribbean states as the most vulnerable countries. Focused primarily on LAC region and sub-regional scales, Section I describe summarily the potential direct impacts of climate change and variability on: Income, in terms of GDP generation, damages on infrastructure, and specifically on agriculture sector issues; human development, particularly related to human health; and, the environment, specifically biodiversity, water resources and coastal zones. Country-level relevant examples (i.e. climate-related disasters, past and current variability) and, particularly, the current situation in relation to economic, human and natural system indicators are given as to illustrate on the type of climate risks and the scope for and constraints to adaptation that the Region faces. This is mainly the approach in Section II. - Recent past and current climate variability Climate and climate impacts. ENSO signal is strong in most LAC. During El Niño high rainfallnoften occurs in the AC and in the RP basin, followed by floods, whereas drought occurs in the NE-Bz and wide regions over Amazonia. La Niña usually has a shift in signal. In Brazil, Uruguay and NE Argentina there is also a signal from tropical Atlantic sea surface temperature anomalies, affecting seasonal climate, especially the actual precipitation patterns. Sub-regions have different records in terms of disaster occurrence and impacts. About 50% of the disasters occur in SA as well as 65% of the fatalities, 75% of the population affected and 53% of total damages. Nevertheless, SA’s exposure to risk is less than in MA or the Cb. MA has a greater proportion of population killed than SA does and the Cb has a greater proportion of affected population than SA. In terms of damages, cumulative losses for 1970-99 represent only 3.9% of the combined GDP of SA countries, whereas they amount to 43% for the Cb. The number of climate-related disasters per year between the periods 1970-99 and 2000-2005 increased by 2.4 times, continuing the trend observed during the 1990s. Likewise, during the latter period the quantification of damages only attained 19% of all disasters. The occurrence of wind-storms, river floods and droughts during the period 1970-2005 was around 9, 14 and 2 per year (Table 4), increased since the 1990’ and totalised 82% of natural disasters. Their estimated damages on agriculture were $ 40, 36 and 11 bn respectively due to decreases in both crops and livestock production. The three of them affected land conservation and livelihood quality. The affected rural population was 30, 50 and 66% respectively. Droughts in particular affected planted surface, grasslands, eco-services, employment, BoP and widened social inequity. Floods increased hydro-power generation by 20 -30 % and droughts decreased generation by 30-60%. Losses in fluvial transportation in the Magdalena river (Colombia) during low-waters associated with El Niño 1997 attained $ 3.9 M. The impact of floods on infrastructure totalised around $ 40 bn for the period 1970-2005, 20% of which on roads and bridges. STERN DRAFT: Understanding the potential Impact of Climate Change and Variability in Latin America and the Caribbean Nagy-Caffera-Aparicio-Barrenechea-Bidegain-Giménez-Lentini-Magrin-Murgida-Nobre-Ponce-Travasso-Villamizar-Wehbe 4 As for human development, the impact of floods on life exposure (in N b of people), physical exposure (in % of population) and killed people (per M exposed) was around 2,000, 20 and 34 per year respectively. Since 2003 economic losses related to climate disasters have dramatically increased, i.e. a 2- 3% decrease in GDP in MA and the Cb due to wind-storms (i.e. Hurricane Emily), and $ 0.9 bn loss in crops in Argentina due to a persistent drought affecting SSA since 2004/2005. Most environmental effects have not been estimated yet. Scope for and constraints to adaptation Income. Investment is still increasing too low to fuel the economies as to solve employment and population’s general well-being problems. Skewed income distribution and poverty will continue to be the sources of constraints to adaptation. Agriculture contributes 8% to the region’s GDP, employs 30-40% of people and is the main source of exports in many countries. During the last few years extreme events disturbed the sector and food security risks increased in several countries as a consequence of successive economic crisis and extreme events, raising the vulnerability especially among the poor. Fossil fuels account for 54% of primary energy and hydro-power generation 22%. The dependency of the electrical systems on hydro-power is 57%, thus they are highly dependent on water resources. However, it is likely that the region will be able to satisfy increasing demands by means of new dams’ construction and interconnected transmission networks. Also, alternative sources of energy such as biomass, solar and nuclear should likely expand under high demand scenarios from < 5% in 2004 to about 10% in 2050 and 20% in 2080. Human Development. LAC population is changing to a more urbanised, elderly, and with a lower rate of growth society. Population’s yearly growth rate decreased from 2.7% in 1950 to 1.5% in 2000 and will decreaseto 1.0 – 1.3% by 2050. Growth is greater in central age-classes and will turn to an increase of the class > 60 years by 2050, a situation that will require both developing production and employment policies and new responses for elderly protection. As for the access to drinking water, the AC sub-region shows the highest vulnerability and this situation may be exacerbated under the expected changes in water availability. There is higher vulnerability in rural areas where drinking water coverage is 69%, against 95% in urban areas. Nevertheless, the latter are affected by insufficient access to water and sanitation services involving particularly poor population in large cities. Glacier melting impacts are greater during the dry season.