Earthquakes expected to deal heavy blow to Japan’s GDP: Economists

By Riyaz ul Khaliq

ISTANBUL (AA) – The destruction caused by earthquakes will deal a “heavy blow” to the gross domestic product of Japan, the country’s economists have predicted.

Japan was hit by a massive earthquake on New Year Day, killing at least 202 people, while over 100 others are still missing.

Economists estimate the economic impact “to run into the hundreds of millions of dollars and say the figure could rise as the full extent of the damage becomes clear,” Japanese public broadcaster NHK reported on Wednesday.

Nomura Securities economists say the GDP of world’s third-largest economy “could drop by 160 to 340 million dollars as a result of the quake.”

The epicenter of 7.6 magnitude earthquake was Noto Peninsula in Ishikawa province, home to one of the biggest machinery, semiconductor and food factories, with experts fearing that loss in GDP could rise if the supply chains remain affected for longer period of time.

Agriculture and fishing is also popular in the coastal province, which is also known for traditional crafts.

Authorities fear fishing will be adversely affected as high-rise waves generated in the aftermath of the earthquakes damaged boats as well.

In its estimates, SMBC Nikko Securities said the GDP “could drop by about $440 million.”

The actual devastation caused by the earthquakes is yet unclear as access to affected regions remains a challenge due to damage to roads and other communication lines.

​​​​​​​At least 3000 people are still not reachable in Ishikawa province, while thousands of others remain evacuated away from their residential places. Japan has been hit by hundreds of tremors since Jan. 1.