UPB Warns Climate Change Could Slash Italy’s GDP

(MENAFN) Climate change could slash Italy’s GDP by more than 5% by 2050 unless current environmental policies are strengthened, the Parliamentary Budget Office (UPB) warned on Wednesday.

In its annual report, the UPB highlighted Italy’s particular exposure to climate risks due to its extensive coastline, water scarcity, and dependence on agriculture. The report noted that climate-related disasters—including floods, droughts, wildfires, and heatwaves—already reduced Italy’s GDP by 0.2% in 2023. If no new mitigation measures are adopted, economic losses could climb to 5.1% by mid-century.

However, if Italy adheres to its carbon neutrality targets, the projected contraction could be significantly lower—just 0.9%, according to the UPB. It also forecast that, without robust climate interventions, the frequency of extreme weather events could rise sixfold by 2050. A shift to a net-zero emissions trajectory could limit that increase to a twofold rise.

The report emphasized the need for urgent investment in renewable energy, improved energy efficiency, and climate resilience. Still, UPB President Lilia Cavallari acknowledged the challenge of securing adequate funding amid global economic volatility and ongoing disruptions in trade.

Italy’s economic outlook remains sluggish, with growth expected to reach only 0.6% in 2025—down from a previously anticipated 1.1%.

The nation has already experienced escalating climate-related damage in recent years, including lethal flooding, extensive wildfires, and significant agricultural losses. A devastating 2023 flood in Emilia-Romagna claimed 17 lives and forced thousands from their homes.

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