wildsingapore news: Nov 19, 2011

* Floods, supply disruptions, to cost billions -Allianz
* Disaster to trigger risk rethink for industry, insurers
* Climate-change significant threat to manufacturers
David Fogarty and Kevin Lim Reuters 18 Nov 11;

SINGAPORE, Nov 18 (Reuters) - Insured losses arising from the Thai floods could be in double-digit billions, a senior official from global insurer Allianz said, in a disaster that will lead to a re-assessment of weather risks to industry in Asia and to global supply chains.

Calculating the true cost of the floods could take years in terms of working out the lost business to Thailand from investors who might now choose to invest in other countries, said Lutz Fullgraf, Allianz's regional CEO for global corporate and specialty.

He said the losses comprise compensation to building owners in Thailand as well as manufacturers around the world who have suffered disruptions arising from the closure of Thai factories.

"This for Thailand is definitely the costliest event, in terms of the insured values, even if you take into consideration the tsunami of 2004 and last year's riots. The loss here is much bigger," said Lutz. He pointed to an estimate by Thailand's insurance commissioner of more than $30 billion, although it was too early to verify the figure.

"People did not have that (wealth and asset) accumulation expectation for risks in Thailand. Even if it is $20 billion, I think it will top the list of insured flood losses over the past 10 years," he said in an interview in Singapore. (Editing by Muralikumar Anantharaman)

Insurers braced for Thai flood bill topping $10bln
* Mitsui, Tokio Marine see losses of 130 bln yen, 100 bln yen respectively
* Lloyd's of London asks Singapore syndicates to assess exposure
* Thailand "critical" in global supply chain - Marsh
Myles Neligan Reuters 18 Nov 11;

LONDON, Nov 18 (Reuters) - Insurers are bracing themselves for claims in excess of $10 billion after floods in Thailand disabled major foreign-owned manufacturing operations there, adding to an already record-breaking natural catastrophe bill this year.

Analysts and industry executives say it is too soon to gauge the full impact of the floods, Thailand's worst in 50 years, as the waters have only just started to recede more than three months after they first rose.

But Thailand's Office of Insurance Commission, the industry regulator, has provisionally estimated an insured loss of about $6.5 billion, according to Standard & Poor's, while insurers and brokers informally put the impact at closer to $10 billion.

"It sounds like it's going to be that sort of magnitude,, maybe even a little bit more," said Execution Noble analyst Joy Ferneyhough.

"It's still ongoing, it's still developing every day and I don't think anyone can get there to assess what's going on."

Reinsurers such as Munich Re and Swiss Re are expected to pick up a proportion of the losses from Thai and Japanese primary insurers, heavily exposed because many of their domestic corporate customers have set up operations in Thailand to escape the strong yen.

Japanese insurers Mitsui and Tokio Marine on Friday said the floods could cost them 130 billion yen ($1.7 billion) and 100 billion yen respectively.

Business interruption claims are likely to account for a big chunk of the costs to insurers, with companies worldwide hit by a shortage of components after the floods knocked out many foreign-owned makers of hi-tech gear.

RIPPLE EFFECT

"Thailand is such a critical cog in the global supply chain for some of these industries," said Gary Lynch, head of supply chain risk at Marsh Risk Consulting, part of insurance broker Marsh.

"The concentration of organisations and support organisations affected is probably greater than we've seen in any other event."

British TV decoder maker Pace on Thursday issued a profit warning, blaming uncertainty over the cost of computer hard drives after the Thai operations of its main supplier, U.S. group Western Digital, succumbed to the floods in October.

Seven major Thai industrial estates have been affected, disrupting the operations of Japanese manufacturers including Nissan, Sony, Canon, Panasonic and Honda, while across the country, a total of 14,000 businesses have closed, according to reinsurance broker Guy Carpenter.

"Flood damage can be rather severe because Thailand is not really an emerging market when it comes to industrial facilities," Ulrich Wallin, Chief Executive of reinsurer Hannover Re said last week, estimating the company's own exposure at about 100 million euros ($135 million).

The Thai floods come on top of a spate of catastrophes, including the March 11 Japanese earthquake, which inflicted a record $70 billion in losses on the insurance industry in the first half of 2011 alone, according to Swiss Re.

The Lloyd's of London insurance market has asked syndicates at its Singapore outpost to assess their exposure, a Lloyd's spokeswoman said on Friday, adding that it was too early to provide a loss estimate for the market.

One consequence of the floods has been an unexpected increase in insurance claims related to the March earthquake from Japanese manufacturers who moved to Thailand to minimise disruption after the earth tremor, according to law firm Reynolds Porter Chamberlain (RPC).

"Moving production from Japan to Thailand was a 'Plan B,'" said RPC Legal Director in Reinsurance Daniel Saville.

"The question now is whether those businesses have a 'Plan C'"

Read more!

Heavier rainfall, storms and droughts could wipe billions off economies and destroy lives, says report by 220 scientists
Fiona Harvey guardian.co.uk 18 Nov 11;

Heavier rainfall, fiercer storms and intensifying droughts are likely to strike the world in the coming decades as climate change takes effect, the world's leading climate scientists said on Friday.

Rising sea levels will increase the vulnerability of coastal areas, and the increase in "extreme weather events" will wipe billions off national economies and destroy lives, according to the Intergovernmental Panel on Climate Change (IPCC), the body of the world's leading climate scientists convened by the United Nations.

Scientists have warned of these effects for years, but yesterday's report – the "special report on extreme weather" compiled over two years by 220 scientists – is the first comprehensive examination of scientific knowledge on the subject, in an attempt to produce a definitive judgment. The report contained stark warnings for developing countries in particular, which are likely to be worst afflicted in part because of their geography, but also because they are less well prepared for extreme weather in their infrastructure and have less economic resilience than developed nations. But the developed world will not be unscathed – heavier bursts of rainfall, heatwaves and droughts are all likely to take their toll.

Chris Field, co-chair of the IPCC working group that produced the report, said the message was clear – extreme weather events were more likely. "Some important extremes have changed and will change more in the future. There is clear and solid evidence [of this]. We also know much more about the causes of disaster losses."

He urged governments to take note – many of the economic and human impacts of disasters can be avoided if prompt action is taken: "We are losing way too many lives and economic assets in disasters."

The report was timed just before crucial talks taking place later this month in Durban, South Africa, where the world's governments will discuss a new global agreement to tackle greenhouse gas emissions and climate change.

Europe's climate chief, Connie Hedegaard, said the report should galvanise governments to act, especially when added to the stark warnings last week from the International Energy Agency that the world has only five years to take the emissions-cutting measures needed to prevent catastrophic global warming. She said: "Last week, the serious warnings from the International Energy Agency. Today, this IPCC report … With all the knowledge and rational arguments in favour of urgent climate action, it is frustrating to see that some governments do not show the political will to act. In light of the even more compelling facts, the question has to be put to those governments in favour of postponing decisions: for how long can you defend your inaction?''

Bob Ward, policy and communications director at the Grantham Research Institute at the London School of Economics, said the report meant the science was now clear: "This expert review of the latest available scientific evidence clearly shows that climate change is already having an impact in many parts of the world on the frequency, severity and location of extreme weather events, such as heatwaves, droughts and flash floods.

"This is remarkable because extreme events are rare and it is difficult to detect statistically significant trends in such small sets of data. What is more, these trends have been identified over the last few decades when the rise in global average temperature has been just a few tenths of a centigrade degree.

"The report shows that if we do not stop the current steep rise in atmospheric levels of greenhouse gases, we will see much more warming and dramatic changes in extreme weather that are likely to overwhelm any attempts human populations might make to adapt to their impacts."

But the summary report was also hedged with caveats, reflecting the difficulty in tying specific extreme weather events to human-induced global warming. Attributing economic losses – such as the damage from storms and floods – is also tricky, because of other factors involved. Rising urbanisation and wealth mean that losses today are higher than in the past.

This point is likely to become particularly contentious in the future, as developed country governments are called upon to provide funding to the poor world to help people adapt to the effects of climate change.

Although the scientists said they were still unsure whether a warming climate would result in an increase in the frequency of hurricanes and other tropical cyclones, there was a stark warning for the northern hemisphere, and areas of Europe and North America where currently hurricanes hardly ever happen. There has been a "poleward shift" in the pattern of the storms, which will mean severe storms are more likely to strike areas such as New York and the Atlantic coast of Europe.

Scientific models also show that it is "very likely" – a term that denotes, in IPCC parlance, a 90% to 100% probability – that the "length, frequency and/or intensity of warm spells or heat waves will increase over most land areas". This means that record hot days, which previously could be expected once in 20 years, are now likely every other year. This could have a serious impact on old people and the very young in particular, who are more vulnerable to changes in temperature.

The report said: "It is likely that the frequency of heavy precipitation or the proportion of total rainfall from heavy falls will increase in the 21st century over many areas of the globe. This is particularly the case in the high latitudes and tropical regions, and in winter in the northern mid-latitudes. Heavy rainfalls associated with tropical cyclones are likely to increase with continued warming." This means that cloudbursts that could have been expected once in 20 years will now become a one-in-five-year occurrence. The scientists were reluctant to translate this into concrete warnings over the frequency of floods, because floods depend on local factors such as topography, but said floods, mudslides and landslips are associated with stronger rainfall punctuated by drier spells.

The scientists said there was "medium confidence" that "droughts will intensify in the 21st century in some seasons and areas, due to reduced precipitation and/or increased evapotranspiration". They pinpointed the most vulnerable areas as southern Europe and the Mediterranean region, central Europe, central North America, Central America and Mexico, north-east Brazil, and southern Africa.

Simon Brown, climate extremes research manager at the Hadley Centre, the climate research unit of the UK's Met Office, said: "This focus of the IPCC on extremes is very welcome as less emphasis has traditionally been given to these phenomena which are very likely to be the means by which ordinary people first experience climate change. Human susceptibility to weather mainly arises through extreme weather events so it is appropriate that we focus on these which, should they change for the worse, would have wide-ranging and significant consequences. This review will be very helpful in progressing the science by bringing together a wide range of studies – not just on the physical weather aspects of climate extremes but also on how we might adapt and respond to their changes in the future."

Development campaigners urged swift action from governments meeting at the end of this month in Durban, South Africa, to continue negotiations on a global agreement to tackle climate change. Tim Gore, Oxfam climate change adviser, said: "[This] is a warning bell for world leaders to act now on climate change to save lives and money. The link between climate change and an increase in the frequency and intensity of some extreme weather events is becoming ever clearer, and it is the world's poorest and most vulnerable people who are being hit the worst. Floods and droughts like those which recently hit east Asia and the Horn of Africa can wipe out whole harvests, contributing to soaring food prices and driving poor people into hunger."

He added: "Estimates suggest that every dollar invested in adaptation to climate change could save $60 in damages. Governments must find the new money needed to invest now, and avoid the far higher costs of clean-up and lives lost later."

Fierce Heat Waves & Stronger Storms Coming, Climate Report Warns
Wynne Parry LiveScience.com Yahoo News 19 Nov 11;

Humans' activities appear to have brought on more extreme weather — including more hot days, heat waves and heavy precipitation — and we can expect this to worsen in decades to come, according to a report being prepared by the leading international climate change organization.

A summary report, released today (Nov. 18), states that since 1950, cold days and nights have decreased, while warm ones have become more frequent globally, as has heavy precipitation. There is also evidence droughts have increased in some places, but decreased in others, the report by the Intergovernmental Panel on Climate Change says.

The rest of the century will bring more extremes, according to this scientific assessment, which predicts:

At least a 99 percent likelihood of more frequent and intense daily temperature highs, as well as declines in daily lows.
Heat waves that will become more frequent, longer as well as more intense.
An increase in heavy precipitation, particularly in the high latitudes, the tropics and during winters in the northern mid-latitudes.
More intense droughts in some places. [Photos Reveal Devastating Texas Drought]
The wind speed of tropical cyclones, which include hurricanes, is expected to increase, at least in some places, but there may be fewer or no change in the number of cyclones.
Extremely high coastal waters thanks to sea level rise
More landslides and other events associated with high mountains

Predictions like these bring to mind disastrous events like the European heat wave of 2003, droughts that crippled Russian agriculture in 2010 and hit the U.S. hard this summer, as well as the heavy rains that flooded Pakistan in September.

However, climate change did not create these events. Rather, it sets up a situation that enables naturally occurring weather extremes to become more severe. So, the effect of climate change is visible only over the long term.

The situation is like a baseball player on steroids, according to Gerald Meehl, a senior scientist at National Center for Atmospheric Research in Boulder, Colo. If that player hits one home run, it's not clear if that home run is due to the steroids. To see how the steroids affected the player, it's necessary to compare his performance during the steroid-enhanced season with that from a previous one when he was not using steroids, Meehl said.

"Greenhouse gases are the steroids of the climate system," said Meehl, who served as a reviewer for part of the climate change report. "Greenhouse gases have changed the background state of climate such that the changes of setting heat records are much greater than (those of setting cold records)."

Some changes are more easily observed and predicted than others.

By looking back 50 years at temperature records from across the continental U.S., Meehl and colleagues found that the ratio of days when temperatures exceeded their record high for that date to days when temperatures dropped below their record low for that date shifted in favor of record warmth. Between 2000 and 2010, the ratio of record highs to lows grew to 2 to 1.

That shift continued into the future, in their computer models, with warm days outnumbering cold ones as much as 50 to 1 by the end of the century. It is significant, Meehl points out, that the extreme cold days did not go away.

While it's intuitive that global warming would cause more extreme heat, the report suggests there's also a 66 percent or greater likelihood it will lead to more heavy rain and snowfall in many areas. That's because global warming means warmer air in some places, and the warmer the air, the more moisture it can hold, providing more water for a storm to dump, he explained.

Some changes are more difficult to predict than others.

While the summary report offers some predictions about tropical cyclones, which include hurricanes, looking ahead at these types of events can be tricky. Hurricanes are problematic because ideally they require global ocean-atmosphere models run for a century or more with higher spatial resolution than what current computers make feasible. Also, the observational record of hurricanes is spotty prior to the 1970s, when satellites began tracking them, so the historical record before then is more uncertain. [Images: Hurricane Hunters in Action]

The full IPCC report, "Managing the Risks of Extreme Events and Disasters to Advance Climate Change Adaptation," also addresses the human dimension, discussing the impacts of natural disasters caused by extreme weather events and how risk and losses can be mitigated. The full report is expected to be released in February 2012.

Climate change key driver of extreme weather: UN
AFPBy Max Delany AFP Yahoo News 18 Nov 11;

Man-made climate change has already boosted heatwaves and flood-provoking rainfall and is likely to contribute to future natural disasters, according to a report by UN scientists unveiled Friday.

But the toll from these extreme weather events will depend as much on the measures taken to protect populations and property as the violence of Nature's outbursts, it warned.

The report, released 10 days before climate talks in Durban, South Africa, is the UN's first comprehensive review of global warming's impact on weather extremes and how best to manage them.

"We can actually attribute the increase of hot days in the past few years to an increase in greenhouse gases," said Thomas Stocker, co-chair of the Intergovernmental Panel on Climate Change (IPCC), which approved a summary of the report at a meeting in the Ugandan capital, Kampala.

"And it is virtually certain that increases in the frequency and magnitude of warm daily temperature extremes, and decreases in cold extremes, will occur in the 21st century," he said at a press conference.

"Heavy precipitation will become more frequent in many regions of the world," he added.

Heat and rain extremes under three projections -- a sharp reduction in carbon emissions, a modest one, and current "business-as-usual" levels -- were reviewed in the report.

All three scenarios see a roughly similar trajectory of increased extremes up to mid-century.

But towards the end of the century the pathways diverge dramatically, with far higher and more frequent heatwaves and rainfall peaks in the worst-case scenario of a world saturated with greenhouse gases.

For the high-emission scenario -- the path the world is on now -- one-in-20-year heat peaks would occur every five years by about 2050, and every year or two by the end of the century. Precipitation extremes increase in a similar fashion, the report showed.

Qin Dahe, also an IPCC co-chair, said the panel was likewise "more confident" that climate change is boosting glacier retreat, a major concern for nations in Asia and South America dependent on glaciers for water.

But for other extreme weather events such as cyclones, scientists are still unable to pin down the impact of climate change, due to lack of data and the "inherent variability and variations in the climate system," Stocker said.

"Uncertainty cuts both ways. Events could be more severe and more frequent than projections suggest, or vice versa."

Some studies have suggested that warmer air and sea surface temperatures combined with greater moisture in the air will intensify tropical storms.

The 20-page document released Friday summarises the conclusions of an underlying 800-page report, three years in the making, that reviews thousands of recent peer-reviewed scientific articles.

It was written by some 200 scientists, and approved this week by the 194-nation IPCC, which gathers government representatives as well as experts.

Climate-fuelled extremes will hit the globe unevenly, it says: the 2003 heatwave that left 70,000 dead in Europe may be a template for future peaks in southern Europe and northern Africa; swathes of Africa where millions already live at hunger's edge face more drought; small island states could become unliveable due to storm surges enhanced by rising seas.

"The key message is the way the interaction of the extremes, exposure and vulnerability create disaster risk," said Chris Field, co-chair of the IPCC's Working Group II, which focuses on adaptation.

"It goes without saying that this [report] is yet another wake-up call," the European commissioner for climate action, Connie Hedegaard, said in a statement issued in Brussels.

"With all the knowledge and rational arguments in favour of urgent climate action, it is frustrating to see some governments do not show the political will to act."

"This report should leave governments in no doubt ... that climate change is, through its impact on extreme weather, already harming the lives and livelihoods of millions of people," said Bob Ward of the Grantham Research Institute on Climate Change and the Environment at the London School of Economics.

Special Report on Managing the Risks of Extreme Events and Disasters to Advance Climate Change Adaptation (SREX)

Best of our wild blogs: 19 Nov 11

Philippines government recommends mangrove plantations to solve flooding

Thai floods could be costliest in decade

Extreme weather will strike as climate change takes hold, IPCC warns

Blog Archive

past daily news

subscribe via email

news categories

more news blogs

visit counter