FOCUS – Extreme Heat Hits Europe’s Economy, €113 Billion in Losses

MUNICH, September 24 /ATSH-DPA/ – Europe’s economy has lost around €113 billion this year because of extremely high summer temperatures, which reduced productivity and economic output, according to the German insurance company Allianz.

Italy suffered the largest losses, around €28 billion, followed by Germany with €25 billion. France ranks third with €20 billion.

The economic losses were caused mainly because extreme heat made people work less and more slowly, take more breaks during work, and miss work more often.

Across Europe, the economic damage from high temperatures is expected to be less than 0.5% of this year’s economic output.

Allianz made these calculations through a new system called “Climate Risk Tracker”, which uses weather and damage data to calculate their potential impact on the economy.

Damage from natural disasters

Allianz also said that storms, floods and other natural disasters caused around €50 billion in damage in Germany over the past five years.

Annual losses in Germany were on average twice as high as in the 2000–2019 period.

Worldwide, damage from natural disasters has risen by 54%, according to Allianz.

Frank Sommerfeld, head of Allianz’s property insurance division in Germany, said Germany is particularly affected by climate-change-related damage.

Risk for 2027

Allianz also warned of another economic risk next year, linked to the “El Niño” climate phenomenon.

If 2027 proves particularly hot due to El Niño, economic output in 144 countries could fall by around €392 billion.

According to Allianz’s calculation, China is expected to suffer the largest losses.