Archive · 2 Oct 2026
Climate shocks threaten Europe and India with billions
Extreme weather can cost countries a lot of money, even when buildings are not destroyed.
Global weather-related losses were about $210 billion in 2025.
Europe could lose about $128 billion in 2026 because very hot weather may reduce how much people can work and increase energy and healthcare costs.
Italy, Germany and France may experience much of that loss.
A weather pattern called El Niño could also affect the global economy in 2027.
Allianz estimates that India could lose about $50 billion from its temperature effects.
El Niño could also raise food prices and overall inflation.
The report says countries may reduce these risks by spending more on preparation, warnings and stronger infrastructure.
Global extreme-weather losses reached $210 billion in 2025, down from $307 billion in 2024 but still 20% above the 2000–2019 average.
Allianz estimates that 2026 heatwaves across 30 European countries could reduce economic output by €113 billion, or about $128 billion.
Italy, Germany and France are expected to account for nearly two-thirds of Europe’s projected heatwave losses, while Cyprus could see the largest growth reduction.
A potentially strong El Niño developing in 2026 and continuing into early 2027 could reduce output across 144 economies by about $451 billion in 2027.
India could face an estimated $50 billion loss under the El Niño temperature-impact scenario, although the estimate excludes losses from floods, droughts and wildfires.
- Who
- Countries and economies worldwide, with particular attention to European countries, India, China and the United States; the estimates were produced by Allianz.
- What
- A report estimates the economic costs of 2025 extreme weather, Europe’s possible 2026 heatwaves and a potential 2027 El Niño.
- When
- The losses occurred in 2025; the European heatwave estimate concerns 2026; and the potential El Niño impact concerns 2027.
- Where
- Globally, across 30 European countries and 144 economies, including India.
- Why
- Extreme heat and related climate effects can reduce productivity, increase energy and healthcare costs, raise inflation and pressure public finances.
- Global extreme-weather losses in 2025
- $210 billion
- Global losses in 2024
- $307 billion
- European heatwave estimate for 2026
- €113 billion, or about $128 billion, across 30 countries
- Potential global El Niño output loss in 2027
- About $451 billion across 144 economies
- Estimated Indian El Niño impact
- About $50 billion in lost economic output
- Estimated global inflation effect
- Headline inflation could rise by 0.42 percentage points on average, with food inflation rising by 0.65 percentage points
- Largest 2025 absolute national loss
- The United States recorded $118.5 billion, equal to about 0.4% of GDP