Potential risk by riverine floods in the global economy: Sector-wise assessment of direct and indirect impacts through international trade

With globally interconnected economies through supply chains, the economic impacts of riverine flooding-one of the most devastating natural disasters-pose significant concerns for both directly affected countries and their trade partners. These impacts vary across sectors, highlighting the need for sector-wise assessments to capture this heterogeneity and the potential for transboundary propagation, thereby supporting the development of flood-resilient supply chains globally. This aspect has not been thoroughly explored in previous global flood risk assessments. Here, we overcome this challenge by conducting a global, sector-wise assessment of direct economic losses driven by business interruptions and proposing the Loss-weighted Herfindahl-Hirschman Index (LHHI) indicators designed to capture the potential indirect propagation of these losses through international trade. We demonstrate that the global annual direct economic loss across agricultural, industrial, and service sectors amounts to US$194 billion, highlighting the potential overestimation of global flood risk in previous studies. China, India, the USA, Indonesia, and Egypt are the major risk-giving countries of floods through international trade, owing to their large direct economic losses and diverse export partners, accounting for more than 50 % of the global direct economic loss. Meanwhile, emerging and developing countries in Asia and Africa, and some developed countries with concentrated imports from high-risk-giving countries, show considerable potential to be indirectly affected by flood impacts, with vulnerability differing across sectors. These findings emphasize the importance of considering sector-wise assessments of flood-induced economic losses and their potential transboundary propagation to assess flood risks comprehensively; therefore, the assessment method and LHHI indicators developed in this work will support informed policy and investment decisions to build flood-resilient supply chains and ensure business continuity plans.