Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - Climate change threatens Djibouti's development goals, potentially leading to economic losses equivalent to nearly four years of current output by mid-century due to increased extreme heat, drought, and floods [49][55] - Policies and investments aimed at climate adaptation can significantly reduce economic damages, with a limited set of priority actions capable of halving potential GDP losses [50][76] - Significant infrastructure investments have been made, but Djibouti must ensure these assets deliver on their promise for resilience and economic diversification [51][56] - Capacity building, economic reform, and skills development are critical for successful adaptation and diversification [53][78] - Additional concessional resources are required for climate adaptation, with estimated needs exceeding US2.8billion[54][76]SummarybySectionsChapter1–ClimateandDevelopment−Djibouti′seconomicgrowthhaselevatedittolower−middle−incomestatus,drivenbypoliticalstability,strategiclocation,andsignificantforeigndirectinvestment[86]−Theeconomyisheavilyreliantontheservicessector,particularlytradewithEthiopia,makingitvulnerabletoexternalshocks[90]Chapter2–CountryClimateCommitments,Policies,andCapacities−Thereportemphasizestheneedforastrongerinstitutionalframeworktoimplementclimatepoliciesandmobilizefinancing[83]Chapter3–SelectedClimateandDevelopmentPriorities−Djibouti′sinterdependencewithneighboringcountriesthroughtradeandmigrationiscrucialforachievingdevelopmentprioritieswhileenhancingresilience[66]−Investmentsinwatermanagement,urbanplanning,andhealthcareareessentialtosafeguardlivability[70]Chapter4–MacroeconomicandWelfareImplicationsofClimateChange−Climateimpactscouldgenerateapermanentannuallossofupto614-15 billion [75] - Adaptation investments are necessary to mitigate these impacts, with a focus on fiscal management and mobilizing international support [77] Chapter 5 – Conclusion and Recommendations - Economic reform, capacity building, and investment in skills are critical to the adaptation agenda, ensuring that infrastructure investments yield expected benefits [78]
