Dublin could suffer $1bn hit from man-made risks

Cybercrime and financial crashes pose bigger threat to Dublin than adverse weather

Man-made threats such as cybercrime or financial crashes pose a risk of about $1 billion to Dublin’s economic output. Photograph: iStock

Man-made threats such as cybercrime or financial crashes pose a risk of about $1 billion to Dublin’s economic output. Photograph: iStock

 

Man-made risks such as financial crashes and cybercrime threaten about $1 billion (€849 million) of Dublin’s economic output each year, insurer Lloyd’s has found. The threat comes in addition to risks from natural disasters, which could cost the capital $500 million per year, according to a study compiled by Lloyd’s with Cambridge University. The Lloyd’s City Risk Index projects that this figure will grow as extreme weather events become more frequent. The costliest climate-related threat is a flood, which accounts for $130 million of the estimated gross domestic product risk

Across Europe as a whole, freeze and heatwave events account for $1.2 billion in risk, while flood and drought account for $10.68 billion.

“Dublin is ranked ninth of the European cities at risk but that speaks to the high values of our assets. More than half of the GDP at risk identified for Dublin comes from Finance, Economics and Trade - reflecting the highly developed service economy that is flourishing here,” said Lloyd’s general representative for Ireland, Eamonn Egan.

“Ireland has become an important centre for global trade which the rest of the continent relies on. Investments in mitigating risks are simply ways of ensuring Dublin continues to act as one of the hubs in Europe.

“Policymakers can use the City Risk Index to make informed investments to ensure Dublin’s economy is resilient to external shocks,” he said.

Billions in risk

The Lloyd’s City Risk Index finds that 279 cities across the world - with a GDP of $35.4 trillion - risk losing $546.5 billion on average in economic output annually from all 22 threats covered in the study.

“No city will ever be completely risk free,” said Lloyd’s chairman Bruce Carnegie-Brown. “Disruptions will always occur, whether it is the result of a hurricane or a cyber-attack.

“The index shows that investing in resilience - from physical flood defences to digital firewalls and enhanced cyber security, combined with insurance - will help significantly reduce the impact of extreme events on cities, improve economic stability and enhance prosperity for all.”