Politics
Debt Defaults From Italy to Japan Seen If Climate Fight Delayed
- FTSE Russell model runs scenarios for sovereign credit risk
- Ten of 26 members of FTSE index at risk of default by 2050
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Countries from Italy to Australia will default on their sovereign debt by 2050 if there’s a disorderly transition in the planet’s efforts to fight climate change, according to research by FTSE Russell.
The index provider ran two models to assess credit risk, including a “disorderly” scenario where climate policies are not introduced until 2030 and lead to sudden or disruptive economic changes, and a “hot-house world” scenario, where greenhouse gas emissions increase until 2080 and global warming is over 3°C.