Economic Ripples: Spain's Floods Impact GDP

Last month's floods in eastern Spain may reduce GDP by 0.2 points in the fourth quarter, according to the Bank of Spain. With over 200 dead, especially in Valencia, significant economic disruption occurred. The government has allocated 14.36 billion euros in aid to mitigate the impacts.

The catastrophic floods that swept through eastern Spain last month are expected to take a toll on the country's economic performance, with the Bank of Spain estimating a reduction of 0.2 percentage points in the GDP for the fourth quarter.

On October 29, Spain witnessed its most deadly flooding in modern history, claiming more than 200 lives, predominantly in the Valencia region. This area alone contributes to about 2% of Spain's economic activity. These estimates come amidst substantial uncertainty, drawing parallels with previous weather-related events.

To counter the economic blow from the flooding, the Spanish government has launched a substantial aid package amounting to 14.36 billion euros, aimed at supporting affected households and businesses. Despite this adversity, prior projections had placed Spain's economic growth this year at a robust 2.7%, well above its European counterparts.

(With inputs from agencies.)