Spain | The economic effects of the DANA

Summary

Although it has been only a few days and we only have preliminary estimates, the data that we are receiving indicate that the economic effects of the DANA have been very significant at a local level.

Key points

• Key points:
• According to BBVA Research, card spending at POS in Valencia fell by 14% year-on-year from October 28 to November 3, 20 percentage points more than in the rest of Spain.
• But this aggregate figure for the province as a whole belies a high degree of heterogeneity. In more than 40 municipalities, consumption fell by more than 80%.
• In terms of Spain's GDP, the initial damages of the DANA are close to those caused by Hurricane Katrina in 2005 in the United States, which resulted in the loss of 1,833 people and reached US$125 billion at the time, almost 1.0% of the US GDP that year.
• The economic effects of this DANA cannot be fully comprehended considering its relationship with global warming.
• In the last four decades, the Mediterranean has experienced an increase in average temperature that has been almost double the global temperature anomaly recorded on Earth.

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