The influence of the Japanese earthquake and tsunami on the economy

The recent earthquake and tsunami in Japan obviously has a great influence on the Japanese people. Among the things that can be adversely affected, the Japanese economy. There are many different ways this could be affected.

Repair

Earthquake & Tsunami In Japan

The cost of repairs caused by the earthquake and tsunami will be in the billions. Whole cities were wiped out and must be refilled and it will take a lot of time and money. Costs are estimated atsomewhere between $ 100 billion and $ 300 billion.

Industries closed

Entire industries have been closed temporarily, and this will have a negative impact on the economy. Otherwise, businesses are in operation, are not making money. Small businesses as independent companies that have been damaged, and like many big companies billions of dollars of transactions, this has affected all types of businesses.

The nuclear

The safety of nuclear power plant in FukushimaSystem makes the news more than any other story surrounding the earthquake and tsunami. First, in terms of funding was expensive, try to limit the damage. Then there are the lost revenue from non-operating, and will be the cost of repair. It 'also the cost of addressing the damage, such as polluted water.

Transport

The main ports and airports had closed due to earthquake and tsunami and need some repairs. This hashad a major impact on profitability in the short term. It has the power to and from these destinations has meant a slowdown, or in some cases stopped altogether. Some will be closed for some time. This has knock-on effect on slowing down some branches. This is a particular problem, because Japan's economy is dependent on exports.

Public debt

All costs associated with damage of the earthquake and tsunami impact on the public debt of Japan. Because each country in asimilar situation in Japan would have to borrow money to pay for reconstruction needs. And higher debt means higher interest payments.

What may seem like everything is bad news for the Japanese economy, but perhaps not as bad as some fear. The Japanese economy has proved very resistant to such problems in the past, with the 1995 earthquake in Kobe is a good example. Although industrial production fell in the month of the Kobe earthquake, has rapidly increased following theMonth.

The Stock Exchange

The Japanese stock market reaction was negative at first. One of the problems in these situations is to panic the investors sell their shares immediately, although it is unwise and unnecessary. There have been examples of this in Japan after the disaster, then the other knock-on effect. This is not as drastic as it may be, however, with some of the implementation of Japan's history of disaster recovery in the past.

Japanusually guide to recover from natural disasters in many ways. They are active in trying things pulled back to normal as quickly as possible, with seemingly no better example of speed at the airport in Tokyo was running again.

Andrew Marshall (c)

The influence of the Japanese earthquake and tsunami on the economy