Japan quake damage to cost up to $309 bn: govt

Haveeru Daily
Mar 23, 2011 - 12:00
  • Japanese rescuers search through debris in front of a large grounded ship for bodies in Kesennuma, Miyagi prefecture on March 17, 2011 after the March 11 earthquake and tsunami. PHOTO/ AFP

OSAKA, March 23, 2011 (AFP) - Japan on Wednesday said the cost of the March 11 earthquake and tsunami could hit 25 trillion yen ($309 billion), with the destruction pushing down growth in the next fiscal year.

The top range of the estimate would put the disaster at more than double the cost of the 9.6 trillion yen impact of the Kobe earthquake.

The total cost from collapse or damage to houses, factories and infrastructure such as roads and bridges was estimated at 16 trillion yen to 25 trillion yen over the next three fiscal years, the Cabinet Office said.

The estimated figure covers seven prefectures of the hardest-hit areas of Iwate, Miyagi, and Fukushima, as well as Hokkaido, Aomori, Ibaraki, and Chiba.

The damage could lower Japan's growth by around 0.5 percent.

Japan has said it was mulling the idea of establishing a reconstruction agency to oversee the rebuilding effort. The Bank of Japan has pumped in record funds to stabilise financial markets.

Hundreds of thousands have been made homeless by the 9.0-magnitude quake and the devastating tsunami it unleashed.

The giant wave crashed into the northeast coast and erased entire communities. The confirmed death toll from the disaster rose Wednesday to 9,408, and Japan holds little hope for 14,716 officially listed as missing.

The disaster has led to production shut downs at some of Japan's top companies due to damaged facilities, rolling power outages and broken supply chains crucial to making cars, electronic gadgets and machinery.

Transport networks along the northeast remain impassable.

The government had expected gross domestic product to increase 1.5% on a real term basis in fiscal 2011.

The twin disasters have plunged Japan into what Prime Minister Naoto Kan has called its worst crisis since World War II.

A mammoth rebuilding task will be required in its aftermath but Japan faces a huge challenge in financing it without expanding a public debt that is already the industrialised world's biggest at around 200 percent of GDP.

The nation's credit rating was recently downgraded on concerns that not enough is being done to address it.

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