Quantifying the micro and macro-economic impacts of climate change: A multi-model approach for agriculture and fisheries

Climate change poses significant risks to Oman's economy, particularly in climate-sensitive sectors such as agriculture and fisheries. This study employs a multi-scale modeling framework integrating a dynamic bioeconomic model with a structural macro-econometric model with DSGE-consistent features to quantify both direct and indirect economic impacts. At the micro level, the bioeconomic model assesses climate change effects by accounting for climate variability, biosecurity risks, and sectoral performance. Findings indicate that climate change could reduce value-added in agriculture and fisheries by 4.80% to 20.15%, depending on scenario severity. At the macro level, the integrated model reveals GDP losses of up to 0.74%, with non-hydrocarbon sectors experiencing downturns of up to 1.12%, along with employment losses, trade imbalances, and a deterioration in the government balance. The findings highlight the importance of strengthening sector-health management, reducing climate-related productivity losses in agriculture and fisheries, and considering the wider employment, income, and fiscal implications of sectoral adaptation policies. By combining sectoral and macroeconomic perspectives, this study provides actionable insights into Oman's climate vulnerabilities and supports the design of integrated strategies for sustainable economic development in resource-dependent economies.