Europe’s summer 2025 weather extremes cost economy €43 bn, study says

Heat, drought and floods last summer inflicted about €43 billion on Europe’s economy, researchers from the University of Mannheim and the European Central Bank estimated.

Spain, France and Italy were identified as the hardest hit, each with losses above €10 billion, while countries in Central and Northern Europe suffered smaller impacts.

Photo: Hermann Traub/CC0

The team said the macroeconomic bill from the 2025 events could climb to €126 billion by 2029.

The analysis counted both direct and knock-on effects — from damaged roads, buildings and crops to output losses tied to rebuilding shuttered factories.

Sehrish Usman, who led the study, said the true price of extreme weather stretches well beyond immediate damage, with drought-driven shortages of some goods likely to feed inflation over time.

Spain, France and Italy were identified as the hardest hit, each with losses above €10 billion, while countries in Central and Northern Europe suffered smaller impacts.

The authors cautioned their totals are probably understated because they excluded climate-related wildfires and noted that insurance data often miss indirect costs such as heat-related productivity losses.

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Source: PAP, RMF24