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Heatwaves may cut GDP by 0.5 pct points in Europe, Allianz says
Published by Global Banking & Finance Review®
Posted on July 2, 2025
2 min readLast updated: January 23, 2026
Quick Summary
Allianz Research reports heatwaves could reduce European GDP by 0.5% in 2025, with Spain facing the largest impact.
Heatwaves may cut GDP by 0.5 pct points in Europe, Allianz
By Maria Martinez
BERLIN (Reuters) -Recent heatwaves across Europe could slow economic growth in Europe by half a percentage point in 2025, a report by Allianz Research showed, comparing a day with temperatures above 32 degrees Celsius to half a day of strikes.
In Europe, GDP losses range from 0.1 percentage points for Germany to as much as 1.4 percentage points for Spain, where temperatures are around ten degrees higher in summer.
Climate change is increasing the frequency and intensity of heatwaves, droughts and wildfires, with far-reaching economic repercussions.
Globally, the heatwaves translate to a GDP reduction of 0.6 percentage points this year, Allianz Research said.
China, Spain, Italy and Greece could each see GDP losses of nearly one percentage point due to the current heatwaves, the Allianz Research report said, while the U.S. may face a decline of around 0.6 percentage points and France of up to a third of a point.
Extreme temperatures also reduce labour productivity, with the International Labour Organization forecasting that heat stress will reduce total potential working hours worldwide by 2.2% by 2030.
Productivity losses due to heat can be mitigated, Allianz Research said, calling for structural measures to prepare cities and adapt workplaces.
(Reporting by Maria MartinezEditing by Ludwig Burger)
Key Takeaways
- •Heatwaves may cut European GDP by 0.5% in 2025.
- •Spain could see a GDP reduction of 1.4 percentage points.
- •Climate change increases heatwave frequency and intensity.
- •Global GDP could reduce by 0.6 percentage points this year.
- •Heat stress may cut global working hours by 2.2% by 2030.
Frequently Asked Questions about Heatwaves may cut GDP by 0.5 pct points in Europe, Allianz says
1How much could heatwaves reduce GDP in Europe?
Recent heatwaves across Europe could slow economic growth by half a percentage point in 2025, according to Allianz Research.
2Which countries in Europe are most affected by GDP losses?
Germany may face GDP losses of 0.1 percentage points, while Spain could see losses as high as 1.4 percentage points due to higher summer temperatures.
3What are the global economic effects of heatwaves?
Globally, heatwaves are expected to result in a GDP reduction of 0.6 percentage points this year, impacting countries like China, Spain, Italy, and Greece.
4How does heat affect labor productivity?
Extreme temperatures are predicted to reduce total potential working hours worldwide by 2.2% by 2030 due to heat stress, according to the International Labour Organization.
5What measures can mitigate productivity losses due to heat?
Allianz Research suggests implementing structural measures to prepare cities and adapt workplaces to mitigate productivity losses caused by heat.
