Attachments
Europe urgently needs to become more disaster and climate resilient
BRUSSELS, 15 May 2024 – Europe needs to invest smartly to strengthen resilience, adaptation, and financing to respond to disasters and climate risks, according to a new report on the Economics of Disaster Risk Reduction and Preparedness released today by the World Bank and the European Commission.
Europe is warming faster than any other continent and is highly vulnerable to the growing risks associated with climate change. Over the past decades, Europe has experienced increasing losses and destruction from climate-related disasters. 2023 will be the hottest year on record, with disaster damages across Europe exceeding €77 billion. Projected costs of inaction under an enhanced warming scenario could reach 7% of the EU’s GDP.
“Disasters are devastating for everyone, but they disproportionately affect Europe’s most vulnerable communities, potentially increasing poverty and inequality,” said World Bank Director Sameh Wahba. “Without the right systems in place, these events can undermine development gains. Although the window to act is narrowing, there is still time for European countries to take action to protect people’s lives, infrastructure, and public finances from the impacts of disasters and climate change.”
The report notes that while European countries have taken significant steps towards strengthening resilience, more needs to be done. The EU-wide analysis found that many critical sectors, including those providing emergency response services, are exposed to multiple natural hazards. For example, the study found that in half of EU member states, fire stations are located in areas where multiple hazards overlap, including wildfires, landslides, floods and earthquakes. Furthermore, in several EU member states, more than 80% of roads are at risk from landslides, which can significantly delay the arrival of assistance to areas in need.
“Investments in prevention and preparedness at all levels are urgently needed, starting with the critical sectors providing emergency response services,” said Hanna Jahn, European Commissioner for Humanitarian Aid and Civil Protection. “The needs are great and pressures on EU and national budgets are growing. Going forward, we need to prioritise investments with the most resilient ‘dividends’ and invest in a smart way.”
Prioritization can improve the cost-effectiveness of investments, especially when considering the impacts of climate change. It allows countries to focus funding on high-risk areas and assets, such as ageing infrastructure and critical networks (electricity, communications, transport), that are vulnerable to the impacts of disasters and could put people at risk or cause major disruptions. Despite gaps and uncertainties, risk and climate change data and analysis can be a powerful tool for selecting the most effective prevention, preparedness and adaptation investments.
To scale up countries’ investments in adapting to the impacts of climate change, more and better quality information on current and future costs is needed. Countries can prepare for uncertain times, take action and develop climate “adaptation pathways”, a decision-making approach that combines current and future climate risk data to better inform climate change strategies. The report shares new evidence on best practices and cost estimates at national and EU level, so decision-makers can plan and budget much more effectively. For European countries, the study finds that the estimated costs of climate adaptation range from 34 to 110 euros per person per year. Speaking specifically of the EU, climate change adaptation costs could be between 15 billion and 64 billion euros per year by the 2030s, suggesting that adaptation finance of 0.1 to 0.4% of EU GDP is needed.
“There is a huge adaptation financing gap in Europe,” said Elina Burdrum, Director General for Climate Action. “Closing this gap requires a significant increase in public, private and blended finance. Investment plans and finance strategies are not based on a full understanding of the costs of climate change adaptation at national and EU level. This needs to change.”
In relation to financial resilience, one of the reports noted that the majority of disaster and climate risks are managed through budgetary instruments at EU level and by EU member states, with gaps in the use of risk transfer mechanisms such as pre-preparedness funds and risk insurance. Wildfire response activities account for around one-third of total response costs in the Union Civil Protection Mechanism (UCPM) budget. For example, if the devastating 2017 wildfire season, which killed more than 100 people and prompted reforms and investments in prevention, were to occur this year, the annual UCPM budget would need to be increased by 70% to cover emergency response activity costs.
The series of reports provides tools and examples to help countries take a more strategic approach to building resilience to climate change, guiding them in their next steps:
“Wise” investments in priority areas to maximise societal benefits, how to estimate the future costs of adapting to climate change, and efficiently managing public finances strained by multiple disasters every year.
The report was produced in collaboration with and funded by the European Commission.
Download the report here.
Further information and past editions of “The Economics of Disaster Risk Reduction and Preparedness in Europe” can be found here.
Press release number: 2024/ECA/102
contact address
Europe
Rachel Winter Jones
44 (0) 7722 99 1830
rjones1@worldbankgroup.org
Washington
Amy Stillwell
+1 (202) 294-5321
email address
