A recent study by Allianz Trade revealed that heatwaves in 2026 resulted in approximately 113 billion euros in losses for Europe. The study, which analyzed the economic impact of climate-related disasters on 30 European countries, found that these losses accounted for around 0.46% of the continent's expected GDP. The damages included destruction caused by natural disasters, as well as losses in production and decreased purchasing power due to global inflation and rising food prices.
Italy, Germany, and France bore the brunt of the damage, with estimated losses of 27.8 billion euros, 25 billion euros, and 20.1 billion euros, respectively. These three countries accounted for roughly two-thirds of the total losses incurred in Europe. The impact of these losses on economic growth was significant, with Italy's growth affected by 1.19 percentage points and Germany's by 0.54 percentage points. Despite having a smaller economy, Italy's losses had a more substantial impact on its growth.
Other European countries, including Belgium and the Netherlands, also suffered significant losses due to the heatwaves. Belgium's estimated losses were 9.4 billion euros, while the Netherlands incurred 9.2 billion euros in damages. Together, the five most affected countries accounted for approximately 81% of the total losses recorded in Europe. The Allianz Trade study emphasized that heatwaves have far-reaching consequences beyond direct material damage.
The study noted that high temperatures can reduce production levels without causing visible damage to buildings or equipment. For instance, data from the Indian manufacturing sector showed that severe heatwaves led to decreased worker productivity and increased absenteeism. This highlights the need for businesses and governments to adapt to the growing threat of extreme weather events.
Looking ahead, Allianz Trade warned that 2027 is likely to be another year of exceptional heatwaves globally. The organization predicted that 2027 could become the hottest year on record, with the average global temperature expected to rise by 1.3 to 1.9 degrees Celsius above the 1850-1900 average. This forecast is based on data from the World Meteorological Organization.
The study also drew attention to the developing "El Niño" climate phenomenon, which could have severe global consequences. Estimated costs associated with "El Niño" could reach 451 billion dollars, equivalent to 0.24% of the expected GDP of 144 economies. Most of these damages are expected to occur in 2027.
As the world grapples with the increasing threat of climate-related disasters, the findings of the Allianz Trade study serve as a stark reminder of the need for urgent action. Governments, businesses, and individuals must work together to mitigate the effects of extreme weather events and adapt to the changing climate.
Key points
- The 2026 heatwaves resulted in an estimated 113 billion euros in losses for Europe.
- Italy, Germany, and France were the most affected countries, accounting for roughly two-thirds of the total losses.
- The study predicts that 2027 could become the hottest year on record, with severe global consequences.
