chapter  4
17 Pages

Transport costs, trade and climate change

ByANDREAS KOPP

The availability of transport services and access to markets at low costs drive international trade. With trade policy-related barriers to international trade reduced, frictions to international trade are to a large extent the consequence of a malfunctioning of the transport sector, including as a result of disruptive climatic factors. 1 Weather events can lead to lasting disruptions of transport systems with drastic consequences for international trade and movements of people and substantial losses in income and welfare. Already, heatwaves in different parts of the world are reported to have damaged or destroyed road surfaces (pavements), while fl oods have often made transport links impassable for weeks and snowstorms have led to shutdowns of airports and the cancellation of thousands of fl ights. The interruption of transport connectivity directly spills over to production, which highly depends on the timely deliveries of intermediate goods. The negative impact on international trade leads to sizeable losses of gains from trade.