Heat waves, droughts and floods have many negative consequences – also financially. According to a study, the losses in the EU amount to more than 120 billion euros in the coming years.
Extreme weather are expensive for European economies. This is the result of a study by researchers from the University of Mannheim and the European Central Bank (ECB). They appreciate the losses caused by heat waves, droughts and floods in the EU at around 126 billion euros up to and including 2029. A third of the total costs, namely 43 billion euros, will already be valued this year.
In the study, the researchers not only want to map direct costs – such as destroyed buildings or harvests – but also indirect costs, for example reduced productivity during heat waves or the departure of people from affected regions.
Some of these total costs are much higher, but do not always occur immediately, but over several years, as the researchers explain. That is why the calculated values relate to the period 2025 to 2029 – but only to the consequences of this year’s summer, not to possible future weather extremes.
Germany has less damage
According to the study, Spain, France and Italy are particularly affected. They each get between almost 34 and 35 billion euros. These numbers also refer to the years up to 2029.
Germany is less affected in comparison with costs of around 2.5 billion euros. Northern countries such as Denmark or Sweden also have relatively low damage. But according to the study, the frequency and the extent of extreme weather events, especially floods, are increasing in these regions.
And: “Smaller economies such as Bulgaria, Malta and Cyprus are particularly susceptible and suffer great losses in relation to gross value added,” it says.
Heat therefore leads to loss of productivity, for example in the construction and hospitality industry, while Dürren mainly affects agriculture. According to the study, floods cause direct damage to infrastructure and buildings, but also indirect losses, for example by interrupted supply chains.
EU countries should invest more strongly
“Extreme weather events are no longer a distant threat – they are already influencing economic development in Europe,” it says. The researchers therefore advocate increasing investment in climate adjustments, such as heat protection in cities or improved water management.
The actual damage could be even higher, according to the University of Mannheim. Forest fires, hail or storm events, for example, were not taken into account in the analysis. The study is based on weather data for the period June to August 2025.
GDP drops to heat waves
The university also published a study in August for the long -term consequences for the gross domestic product (GDP). Accordingly, regional GDP in European countries two years after a heat wave is 1.5 percentage points lower.
After four years, drought events are even three percentage points and after flooding by 2.8 percentage points below the previous level. According to study, regions with low incomes or with already high temperatures are particularly difficult.
Labor productivity also decreases
“In the years after an extreme event, not only the economic power, but often also the number of people who work, falls,” it says. A decline in labor productivity is particularly evident after droughts and floods.
“One reason for this could be that more is invested in so -called adaptation capacities, such as air conditioning systems or flood protection,” said the study. These measures therefore help against direct consequences, but are economically less productive than other investments.
