Line up all of the world's economists end to end, the old joke goes, and they would still fail to reach a conclusion. By tomorrow afternoon the gag could sound a little hollow. Sir Nicholas Stern, a former chief economist with the World Bank, may not speak for all of his colleagues across the globe, but he appears to have reached a startling conclusion: climate change could tip the world economy into a terrible recession and we must start spending serious money to stop it.

Commissioned by the British Treasury to look at the financial implications of global warming last summer, Sir Nicholas has spent more than a year sifting through the economic and scientific evidence. His findings will not be officially released until a meeting at the Royal Society tomorrow, but indications suggest they will turn the current economic argument about climate change on its head.

Sir Nicholas is expected to say that it will be cheaper for developed nations to tackle the problem with significant cuts in greenhouse gas emissions, than to deal with the consequences. Global warming could deliver an economic blow of between 5 per cent and 20 per cent of GDP to world economies because of natural disasters and the creation of hundreds of millions of climate refugees displaced by sea-level rise. Dealing with the problem, by comparison, will cost just one per cent of GDP, he is expected to argue.

Sir Jonathan Porritt, chair of the British government's Sustainable Development Commission, who has seen a draft of sections of the final report, said: "The significance of this is enormous. The call from the scientific community for action has been clear for some time but there are still large numbers of people who argue that we cannot address climate change on a precautionary basis because it will cost too much and affect GDP. The Stern review almost completely destroys the intellectual basis of that argument. It creates a platform on which to move forward far more purposefully and radically than has happened up until now."

Sir David King, the government's chief scientific adviser, said this week: "All of [Stern's] detailed modelling out to the year 2100 is going to indicate first of all that if we don't take global action we are going to see a massive downturn in global economies."

He added: "If no action is taken we will be faced with the kind of downturn that has not been seen since the great depression and the two world wars." Sir David called the review "the most detailed economic analysis that I think has yet been conducted". The review will highlight the threat of sea level rise. Sir David said: "If you look at sea level rises alone and the impact that will have on global economies where cities are becoming inundated by flooding ... this will cause the displacement of ... hundreds of millions of people."

Catherine Pearce, a climate campaigner with Friends of the Earth, said: "The Stern review is significant because it takes the debate out of the circles in which climate is talked about at the moment. Rather than talking about the environmental and humanitarian effects, we're talking about the economics and that changes things considerably. We've got the science and now this is an economic call for action. It basically leaves people with far fewer places to hide."

She added: "There is a sense that the world is watching what happens on Monday, but the big question is what happens afterwards."

Scientists say that by 2050 global emissions of greenhouse gases need to be reduced to about 40 per cent of what they were in 1990 if the world is to avoid a 2-degree-Celsius rise in average temperature deemed the threshold for dangerous climate change, which would see widespread flooding, extreme weather events, and drought. The Kyoto protocol was set up under a UN framework as a first step, with each participating industrial nation given its own target for 2012.

Discussions on what to do after 2012 start in Nairobi next month, where Sir Nicholas is scheduled to speak.

Michael Meacher, the former environment minister who played a key role in negotiating the Kyoto protocol, said: "I think the Stern review is going to be very significant. It completely knocks out the main argument that [US President] Bush has used for not joining the Kyoto protocol."

Stephen Hale, head of the Green Alliance and a former special adviser to Margaret Beckett when she was environment secretary, said: "Stern is primarily targeted at an international audience, but it is also a seminal moment for Gordon Brown because he controls taxation policy, spending policy and regulation policy. Those are the levers you need to pull to deliver domestic objectives on climate change."

Not everybody agrees with what Stern is predicted to say. Bjorn Lomborg, author of the "Sceptical Environmentalist", said: "No economic model would say we should do nothing at all about climate change, but they all say that doing a lot is not a good idea. If the Stern review comes out and says we should do a little, then I think that's entirely in line with other economists. If it says we should do a lot now, then that would be surprising and, I would argue, wrong."

The Guardian

London