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An overview on policy implications and development


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An overview on policy implications and development

  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.