Extreme heat and drought across Europe this summer could erase much of the economic growth expected in the European Union in 2026, according to a report by Dutch bank Triodos. The bank estimates that heat-related disruption could reduce EU GDP by around 1 percent, equivalent to approximately €180 billion ($208 billion) in economic losses.
Reduced labour productivity is expected to account for a major share of the impact, potentially cutting EU GDP by around 0.6 percent. Agricultural output could also decline by between 3 and 7 percent, while higher food and electricity prices and disruptions to roads, railways and inland waterways could add to the economic damage.
France is projected to be among the hardest-hit countries, with recurring heatwaves potentially reducing GDP by 1.4 percent and pushing the economy into a 0.6 percent annual contraction. Italy, Spain and Belgium are also expected to face significant losses, while countries such as Poland could experience a smaller impact due to fewer exceptionally hot days.
