Taiwan’s central bank has announced that it would start including climate change risks in its inflation and economic growth modelling and projections, as well as alter monetary policy to encourage sustainable development.
Taiwan announced last year that it hoped to reach net-zero emissions by 2050, and the government has vowed to spend T$900 billion ($29 billion) toward that goal by 2030.
In a statement on climate change, the central bank warned of the potential of “green swan” occurrences, which allude to an unanticipated environmental disaster caused by global warming and pollution that would cause a financial crisis.
Other central banks across the world have already factored global warming into their plans, and Taiwan will follow suit, according to the central bank.
Read also: IFAD approves N9.7m for 48 farmers affected by flood in Delta
The bank said it would “incorporate weather aspects into forecast models and examine their impact on forecasts such as prices and GDP growth”.
The bank would also “create an overall model relating to climate change at the industry level” to get a thorough grasp of the economic and financial implications of climate change concerns.
It added that it would use monetary policy tools to help promote sustainable financial development.
This story was adapted from Reuters.