Reports: Climate losses could reach 7% of EU’s GDP

Europe needs smart investments to strengthen disaster resilience, adaptation and finance response to disaster and climate risks, the World Bank and the European Commission have insisted.

Reports: Climate losses could reach 7% of EU’s GDP

Pictured: A drought-impacted reservoir in Spain

Europe is warming faster than any other continent and is highly vulnerable to the increasing risks associated with climate change, a new set of reports on the Economics for Disaster Prevention and Preparedness has revealed.

Over the past decades, Europe has seen overwhelming and increasing losses and destruction from climate-related disasters.

2023 was the hottest year on record with disasters across Europe costing more than €77bn. Projected costs of inaction in a high-warming scenario could reach 7% of EU GDP.

“Disasters are devasting for everyone, but can disproportionately impact Europe’s most vulnerable communities, increasing poverty and inequality,” said Sameh Wahba, director at World Bank.

“Without adequate systems, these events can erode development gains. There is still time for European countries to take actions that will protect people’s lives, infrastructure, and public finances from disaster and climate change impacts, though there is a narrowing window of opportunity to take action.”

Infrastructure at risk

The reports noted that while many countries in Europe are taking “major steps” to enhance resilience, more needs to be done.

An EU-wide analysis showed that many critical sectors, including those that provide emergency response services, are exposed to multiple natural hazards.

For example, the study finds that in half of EU member states, there are fire stations located in areas with high levels of more than one hazard including wildfires, landslides, floods, and earthquakes.

Plus, in several EU member states, more than 80% of roads are highly susceptible to landslides, potentially leading to significant delays in reaching areas requiring aid.

“Investments in prevention and preparedness are urgently needed at all levels, starting with critical sectors that provide emergency response services,” said Hanna Jahns, director of European Commission Humanitarian Aid & Civil Protection.

“The needs are significant and the pressure on the EU and government budgets is high. Going forward we need to invest in a smart way, prioritising the investments with the highest resilience dividends.”

The set of reports offers tools and examples to help countries take a more strategic approach to boosting climate resilience, guiding them towards:

  • ‘Smart’ investments in priority sectors to maximise societal benefits
  • How to estimate the future costs of adapting to climate change
  • Efficient management of public finances, stretched by multiple disasters each year

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