while more intense rainfall can overwhelm outdated drainage systems. Extreme weather is also likely to permanently increase the costs for water treatment, whether because of extreme heat damaging water infrastructure90 or due to increased salination. High-impact extreme weather events can cause severe and lasting disruptions to critical infrastructure. Yet, worldwide, mitigation is often viewed as costly and so can be delayed given seemingly more urgent demands on budgets in both the public and private sectors. As the number and intensity of extreme weather events is likely to continue rising in a warming climate,91 so the scale of both direct critical infrastructure impacts and knock-on economic and societal risks is only likely to go up over the next decade.92 Indirect critical infrastructure damage from extreme weather events, for example via flooding causing a failure of utility services, is potentially even a much larger risk than the direct effects themselves.93 In some cases, the resilience of the infrastructure itself may not be the issue, but rather its very relevance amid climate-change impacts. Slow- onset extreme weather, including long-term droughts, is an area of particular concern in this regard. In Uruguay in 2023, for example, two key reservoirs serving Montevideo ran almost completely dry, with a state of emergency being declared in the city in June 2023 amid protests.94 As droughts in many regions become longer and more intense over the next decade, there will be a rising risk that hydropower plants in some locations become stranded assets.95 Countries with existing hydropower that are projected to be vulnerable include China, Jordan, Iraq, Morocco and Syria.96 Saikiran Kesari, UnsplashSimilarly, disruptions to a systemically important supply chain are also a significant risk stemming from extreme weather events affecting critical infrastructure. During the Panama Canal drought of 2023–2024, falling water levels forced a one-third reduction in the number of ships transiting. This led many vessels to re-route, significantly raising shipping costs and leading to delivery delays, shortages and price rises in, for example, some fruits and vegetables in markets as far afield as the United Kingdom.97 Similarly, low water levels in the Rhine and Danube rivers in 2018, 2022 and 2025 increased costs and slowed deliveries of raw materials and components to important Western European industrial hubs, in some cases leading to permanent re-routing of supply chains.98 The EOS findings reflect this interdependence of risks: countries in which executives report a higher perceived risk of Disruptions to critical infrastructure also tend to report a higher perceived risk of Disruptions to systematically important supply chains. Over time it could become more common for the impacts of extreme weather events on critical infrastructure to become permanent. For example, coastal infrastructure – roads and railways as well as port infrastructure – could be steadily eroded and operations frequently halted because of flooding, as waters may not eventually recede. Ensuing disruptions to global trade are likely to become more severe over time.99 The knock-on impacts of critical infrastructure being damaged or rendered unusable (whether temporarily or permanently) by extreme weather events are likely to be especially consequential in low-income countries, where adaptive capacity is more limited. In a significant number of locations worldwide, entire cities are sinking, in some cases faster than global sea levels are rising. This represents arguably the most severe example of permanent damage to critical infrastructure.100 The primary drivers of sinking cities are groundwater extraction, the weight of a city’s infrastructure in relation to its soil type, and geological shifts. Extreme weather events can also be a contributing factor, accelerating erosion and sediment displacement, which destabilizes the ground.101 As this trend continues, all areas of critical infrastructure located in these cities risk being affected by more frequent flooding, damage to building foundations and other factors. A new front for warfare Given its strategic role in underpinning defence and security, as well as in societal resilience, critical infrastructure is increasingly in the spotlight in discussions of the risks of geoeconomic confrontation and state-based armed conflict. In many countries, ownership and operations of critical infrastructure involve foreign operators, which means that continuity of essential services may depend on the stability of commercial and Global Risks Report 2026 50