France faces up to €15 billion in potential losses from drought

France could face between €10 billion and €15 billion in economic losses from this summer’s drought, including direct and indirect costs, the country’s environment minister has said.

Minister for Ecological Transition Monique Barbut cited an assessment she attributed to France’s national statistics institute, Insee, during a crisis meeting, Caliber.Az reports, citing French media.

However, Insee later told AFP that it had not produced such an estimate and that it was not currently able to assess the direct and indirect costs of the drought.

The meeting brought together officials from the ministry’s hydrology committee and representatives of local prefectures as France continues to deal with the effects of prolonged heat and water shortages.

Barbut had previously warned on July 27 that the costs of the country’s historic heatwave could exceed €5.6 billion, based on the estimated economic impact of the 2022 drought.

That year, water supply disruptions affected more than 30,000 people across 80 municipalities, according to government figures.

The number of people affected has since increased. On Wednesday, Barbut said more than 40,000 people were experiencing disruption to their water supplies.

“Ensuring drinking water remains our main priority,” Barbut said, adding that supplies were already under pressure in 50 French departments.

The drought and extreme heat have also placed pressure on France’s electricity infrastructure. Barbut said the electricity supply for more than 550,000 people had been considered under strain the previous week, while almost three million people had been placed under heightened alert.

The conflicting statements over the potential economic cost underline the uncertainty surrounding the full impact of the drought. While the government is preparing for potentially significant losses, France’s statistical institute has stressed that no official estimate of the total direct and indirect costs has yet been produced.

By Aghakazim Guliyev