As climate-driven disasters destabilize global trade and food systems, strong climate action—not delay—could be the path to economic recovery and resilience, said Simon Stiell, Executive Secretary of the United Nations Framework Convention on Climate Change (UNFCCC), this week.

Speaking amid increasing concern over the economic fallout from environmental breakdowns, Stiell emphasized that well-defined and ambitious climate policies could serve as engines for investment, innovation, and stability. His comments follow a series of extreme weather events that have intensified food insecurity and disrupted global markets, offering a stark reminder of the growing link between environmental degradation and economic volatility.

“Famine is back, and the role of global heating cannot be ignored,” said Stiell. “We must stop treating climate action as a burden and start recognizing it as a pathway to economic security and justice.”

Panama Drought Highlights Vulnerabilities

Stiell pointed to recent drought conditions in Panama, which have dramatically lowered water levels in the Panama Canal, as a clear example of climate-related economic disruption. The canal, one of the world’s most important trade arteries, has had to reduce traffic, affecting global shipping schedules and pushing up the cost of goods.

“These disruptions are no longer distant warnings. They’re happening now, and they’re having serious ripple effects across economies,” Stiell noted.

With trade delays, rising transportation costs, and food supply bottlenecks mounting, the economic consequences of climate inaction are becoming more immediate and severe. These effects, experts warn, will disproportionately impact low-income nations least responsible for the crisis but most vulnerable to its impacts.

Climate Finance Falling Short

Despite longstanding pledges to help poorer countries adapt to and mitigate climate change, many wealthy nations are falling short on their commitments. Under the 2015 Paris Agreement, developed countries vowed to mobilize \$100 billion annually in climate finance by 2020—a goal that has yet to be met.

The shortfall has been compounded by shifting political priorities. The United States, historically one of the largest contributors to climate finance, withdrew from the Paris Agreement under former President Donald Trump and significantly cut foreign aid. Although the U.S. rejoined the accord under President Biden, funding has not returned to previous levels, and future contributions remain uncertain given domestic political divisions.

“Climate finance is not charity—it is a critical tool to correct a historic imbalance and enable sustainable development,” said Stiell. “When those commitments are not fulfilled, it’s the most vulnerable who suffer the consequences.”

Call for Fossil Fuel and Luxury Emission Taxes

In the UK, a coalition of more than 80 civil society organizations has called on the government to introduce new taxes on fossil fuels and luxury emissions—such as private jets and superyachts—to boost climate finance contributions. In a public letter, the coalition argued that such taxes would reflect public sentiment in favor of climate justice and ensure that those with the highest emissions footprints contribute proportionately.

“There is strong support for climate action among the British public,” the letter stated. “This is a question of justice. Those who have benefited the most from a carbon-intensive economy must take the lead in fixing it.”

The proposal mirrors growing international calls for wealthier nations to introduce climate-related levies and redirect the proceeds to adaptation, mitigation, and resilience-building initiatives in developing countries.

A Just Transition as a Global Imperative

Stiell and other climate leaders argue that climate finance must go beyond emergency relief and support a broader, long-term just transition—one that helps countries move away from fossil fuels while creating jobs, improving infrastructure, and ensuring social protections.

“There is no economic recovery without climate resilience,” Stiell emphasized. “Smart climate policy can attract private investment, reduce long-term risks, and stabilize economies. It’s the best stimulus we have.”

The message is gaining traction as climate-fueled disasters—from floods in Asia to wildfires in North America—erode public infrastructure, displace communities, and strain government budgets. Analysts warn that failing to invest in adaptation now could result in exponentially higher costs in the future.

Looking Ahead

As the world prepares for the next round of UN climate talks later this year, Stiell called on global leaders to step up and deliver on both emissions reductions and financial promises.

“Delaying action only increases the cost—both human and economic,” he said. “The choice is clear: we can invest in a sustainable future now or pay the price for instability later.”

With the climate crisis escalating and economic inequality widening, the path forward, according to the UN’s top climate official, lies in bold, immediate, and inclusive action—anchored in justice and guided by science.