Extreme heat during last summer cost the Dutch economy an estimated €9.2 billion in losses, according to a report by credit insurer Allianz Trade. The figure places the Netherlands among the five European economies most affected by the economic impact of high temperatures.
“This is not so much about direct, visible damage such as crop failures or damage to infrastructure, but primarily about productivity loss. Damage that you do not see immediately,” said Johan Geeroms, Risk Director Benelux at Allianz Trade.
Allianz Trade estimates that the European economy will lose around €113 billion this year as heatwaves reduce productivity. Italy is expected to suffer the greatest losses, at €27.8 billion, followed by Germany (€25 billion), France (€20.1 billion), and Belgium (€9.4 billion). Together, these countries and the Netherlands account for 81 per cent of the estimated losses across Europe.
The insurer said extreme heat reduces productivity among workers. Companies may also adjust machine operations, alter production processes, or postpone work because of high temperatures.
“All of this ultimately adds up to billions in lost economic output,” Geeroms said.
According to Allianz Trade, output per hour worked falls by about 3 per cent for every additional degree of heat when temperatures range between 30°C and 35°C. Energy costs also increase as businesses rely more heavily on cooling and climate control systems.
Other factors contribute to the economic impact, including lower water levels in rivers. “That economic blow affects the profitability of companies first, and then the purchasing power of households,” Geeroms said.
@anp | NEWS BRAINPORT
