(Paris) Recent heat waves could cut global GDP by almost 0.6 points in 2023, according to an “estimate” by credit insurer Allianz Trade that China could lose 1.3 points of growth.
On Tuesday, the European Copernicus service confirmed that July 2023 – marked by heat waves and fires around the world – had been the hottest month on record on Earth. This July was 0.33°C warmer than the month that held the record so far (July 2019, which averaged 16.63°C).
“In recent months, the United States, Europe, China, and other countries in Asia have experienced record temperature increases […] Climate change will increase the frequency and intensity of extreme heat , spawning a “new normal” of heat waves, droughts and fires. Such events not only impact people and wildlife, but also economies,” Allianz Trade points out in a study released this week.
At the same time, “workers affected by the heat are reducing their working hours, experiencing slowdowns in their tasks and making mistakes. The reduction in productivity at work resulting from extreme temperatures is a well-known phenomenon,” adds the credit insurer.
Cross-checking several available data and studies, Allianz Trade “estimates” that these heat waves “could have cost 0.6 points of GDP in 2023”, “which is important and highlights the weight of climate risks”.
China could see its GDP cut by 1.3 points, according to these calculations, Spain by 1 point, Greece by 0.9 points, Italy by 0.5 points, the United States by 0.3 points and France by 0.1 points.
“A day of extreme heat, exceeding 32 degrees, is equivalent to half a day of strike,” adds Allianz Trade.
