BRUSSELS: Climate change is projected to cost the European Union €190 billion or 1.8 percent of its current annual GDP if global temperatures increase by 3.5°Celsius.

According to the Joint Research Centre (JRC), the European Commission's science service, heat-related deaths are forecast to reach 200,000, the cost of river flood damages would exceed €10 billion and 8000 sq. km. of forest in southern Europe would be destroyed by fire.

The JRC adds the number of people affected by droughts could increase by a factor of seven and coastal damage, due to sea-level rise, could more than triple.

The scientists also determined that if the world managed to keep below two degrees Celsius, the cost would drop by €60 billion.

Connie Hedegaard, outgoing European commissioner for Climate Action said: "No action is clearly the most expensive solution of all. Why pay for the damages when we can invest in reducing our climate impacts and becoming a competitive low-carbon economy? Taking action and taking a decision on the 2030 climate and energy framework in October, will bring us just there and make Europe ready for the fight against climate change."

In this context ASDA, the UK arm of Wal-Mart, has mapped the risks that climate change poses to its business and says without action, up 95 percent of its fresh food sourcing would be progressively threatened by climate change.

ASDA sampled its supply chain and determined that in a world where the temperature rises between 2-4 Celsius, it would cost an additional £102 million to source food; £164 million to process it; and £104 million more for logistics.

The company says its understanding of the risk to future food supplies, processing, logistics and distribution centres has been "invaluable" and is now going to repeat the process for its stores, general merchandise and home shopping for a complete assessment of climate change on its business.