An overview on policy implications and development

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An overview on policy implications and development

  1. 1. LEARNINGS FROM THE MARCH 11 CATASTROPHE IN JAPAN “AN OVERVIEW ON POLICY IMPLICATIONS ANDDEVELOPMENT STRATEGIES
  2. 2. Short term impact over the Long TERM Impact
  3. 3. Introduction: After the 9.0 magnitude earthquake resulted the 10 meter tsunami wave. Regional output of prefectures areas (damaged) is about 4-6 % of Japan’s GDP Kobe Earthquake last 1995 experience 1994 (17.9 % of the world’s GDP) 2010 (8.7 % of the world’s GDP) Export led economy
  4. 4.  Inadequate natural resources Japan’s GDP will decline (JP Morgan and Merrill Lynch) Japan is one of the nations that has a high agricultural tariff Japan didn’t ask for any help
  5. 5. Japan’s Top Priorities Humanitarian Aid Resolving nuclear catastrophe Building infrastructures
  6. 6. Basics of Nuclear Reactors Attitudes towards safety Reactors design inherent safety Reactor applied safety Engineered safeguards Containment, another engineered safeguard Design features for normal operationNote: Nuclear plants are not insured commercially
  7. 7. Results: US $ 309 B or 16-25 trillion yen cost of damaged More than 9, 408 death toll and 14, 716 missing From 1.5 % to -0.4% GDP growth rate 6 Sony Factories were closed Exportation of food (milk) were banned
  8. 8. Economic effects: Higher energy prices Infrastructural renewal project  Will push up Japan’s public debt Banking and insurance losses Environmental perceptions on nuclear energy Money market (yen depreciation) Short term decline of Asian Pacific Economy
  9. 9.  Water crisis Destroyed crops Negative spillover in the manufacturing industries Short supply of gasoline Global supply lines at risk
  10. 10. Policies Implemented: Rationing of electricity/rolling blackouts (Tokyo electric Power Co.) EU FTA were enacted to help Japan Earthquake Reinsurance Account Budgetary funding Reduced public debt (tax reform) Bank of Japan pumped billions of yen (quake budget)
  11. 11.  Advance soft loans to commercial banks – cash supply ( to stop yen from rising too much) 10 trillion yen ($127B) crisis lending Free transportation for evacuees Testing of specific crops They have their nuclear safety commission
  12. 12. Conclusion: Global Growth:  Japan Middle East Market Inflation in China
  13. 13. Recommendation: The first and most fundamental lesson from other natural disasters is that the economy is the least important thing to worry about.

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