The 2026 Drought – An Economic Analysis and Lessons to be Learnt

The heat and drought of recent months have affected the health and well-being of many people. The Austrian agricultural sector, in particular, has suffered tangible economic damage. This report first presents a preliminary assessment of the relief measures adopted in August 2026. However, the main focus is on the questions of what measures can be taken to limit negative economic impacts and how the risk management system – which functions well in general – can be made fit for the future. Strengthening insurance schemes and the use of loans to finance climate change adaptation measures are market-based approaches in this regard.