How the hard reality of climate change hit Europe’s economy this summer
Summary
Europe’s record heatwaves and droughts this summer have already caused billions of euros in economic damage, disrupting power production, shipping, agriculture and public health. Economists warn the losses will deepen over the coming years, with southern Europe facing the biggest hit to tourism, food prices and public finances.
Key Points
- Record heat, droughts and wildfires have disrupted key sectors across Europe, with total losses already estimated in the hundreds of billions of euros.
- River transport on the Rhine and Danube, nuclear power generation and crop yields have all been hit hard by low water levels and extreme temperatures.
- Southern Europe faces the largest risks from falling tourism, higher food prices and outward migration as climate shocks intensify.
- Economists warn the fiscal strain could push up government debt and increase pressure on the ECB to respond if bond markets sell off.
