News / Asia

Japan Injects $183 Billion to Stabilize Quake Rattled Economy

Residents cross a bridge covered with debris after the March 11 earthquake and tsunami in the city of Ishinomaki in Miyagi prefecture on March 15, 2011
Residents cross a bridge covered with debris after the March 11 earthquake and tsunami in the city of Ishinomaki in Miyagi prefecture on March 15, 2011

Multimedia

Japan's central bank moved quickly Monday to reassure investors that sufficient money will be available to rebuild the nation's quake-damaged economy, injecting nearly $200 billion to stabilize financial markets.  But the economic damage from Japan's worst earthquake ever recorded may be more severe than first thought. Although the full impact won't be known for some time, analysts say it could take years for the world's third-largest economy to recover.

Last Friday's massive quake could well be the most expensive natural disaster in Japan's history.  Already saddled with a huge debt and a shrinking economy, Japan's central bank announced it is pumping $183 billion into money markets to keep interest rates low and to make sure banks have adequate funds for emergency activities and rebuilding.

Central bank governor Masaaki Shirakawa spoke to reporters Sunday night.

"The Bank of Japan will do its best to ensure stability of the financial markets and supply adequate liquidity.  Rest assured that the central bank and commercial banks will work together to provide enough cash," Shirakawa said.

But the triple blow to Japan's economy - the massive earthquake, deadly tsunami and now the threat of multiple nuclear meltdowns - could complicate the recovery.  

Worries about the threat of massive power disruptions to Japanese factories triggered a broad sell-off in the Tokyo stock exchange, sending the Nikkei index to its lowest level in four months.

Tokyo economist Takuji Okubo says the disruptions are especially problematic in manufacturing-intensive economies such as Japan.

"I would say the biggest risk is power,” Okubo states. “If Japan is to lose relatively permanently, say for like a year, 10-20 percent of power generation, I think that would be severely negative for the economy."

It's a huge blow for Japan, which last year lost its standing to China as the world's second-largest economy.  Investment strategist Shinichi Ichikawa says the entire country is affected.

"So you know the impact is pretty much expanding, not only in the northeast area of Japan, but also the capital city, Tokyo.  And you know that some of the infrastructure in Tokyo should have been pretty much impacted,” Ichikawa explains. “So that is why nobody can know the real economic impact from this earthquake."

Those who survived the quake know the scale of their tragedy, as many as 10,000 are feared dead. Millions are without power.

In Supermarkets, shoppers scan empty store shelves looking for basic goods.

And in Tokyo's normally busy streets, traffic is sparse as motorists’ line up for fuel.

The magnitude of the disaster is evident to all.  

Analysts say the nation's growth will likely fall short, as business and industry cope with power shortages and damaged transportation facilities.  But in the long run, economists say the need to rebuild damaged cities and infrastructure will help Japan recover from the country's worst crisis since the World War II.

You May Like

Mood Tense Ahead of Scotland Independence Vote

As race to persuade undecided voters continues, No voters say they believe life in Scotland will slowly improve and do not want to take a risk by endorsing independence More

South Africa’s 'Open Mosque' Admits Everyone, Including Critics

Open Mosque founder plans to welcome gay worshipers and allow women to lead prayers More

Ukrainian Activist in Despair About Future of Her Country

IrIna Dovgan, accused of being a spy and tortured by pro-Russian separatists, is appealing to UN Human Rights Council to support her country More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
NASA Picks Boeing, SpaceX to Carry Astronauts Into Spacei
X
September 17, 2014 4:20 AM
The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video NASA Picks Boeing, SpaceX to Carry Astronauts Into Space

The U.S. space agency, NASA, has chosen Boeing and SpaceX companies to build the next generation of spacecraft that will carry U.S. astronauts to the International Space Station by the year 2017. The deal with private industry enables NASA to end its dependence on Russia to send space crews into low Earth orbit and back. Zlatica Hoke has more.
Video

Video Future of Ukrainian Former President's Estate Uncertain

More than six months after Ukraine's former President Viktor Yanukovych fled revolution to Russia, authorities have yet to gain control of his palatial estate. Protesters occupy the grounds and opened it to tourists but they are also refusing to turn it over to the state. VOA's Daniel Schearf reports from Mezhigirya, just north of Kyiv.
Video

Video China Muslims Work to Change Perceptions After Knife Attacks

China says its has sentenced three men to death and one woman to life in prison for a deadly knife attack in March that left more than 30 dead and 140 injured. Beijing says Muslim militants from China's restive western region of Xinjiang carried out the attacks. Now, more than six months after the incident, residents in the city are still coping with the aftermath. VOA's Bill Ide has more from Kunming.
Video

Video Enviropreneur Seeks to Save the Environment, Empower the Community

Lorna Rutto, a former banker, is now an ‘enviropreneur’ - turning plastic waste into furniture and fences discusses the challenges she faces in Africa with raw materials and the environment.
Video

Video West Trades Accusations Over Ransoms

As world leaders try to forge a common response to the threat posed by Islamic State militants in Iraq and Syria, there is simmering tension over differing policies on paying ransoms. In the past month, the jihadist group has beheaded two Americans and one Briton. Both countries refuse to pay ransom money. As Henry Ridgwell reports for VOA from London, there is uncertainty in the approach of some other European nations.
Video

Video Scotland Independence Bid Stokes Global Interest

The people of Scotland are preparing to vote on whether to become independent and break away from the rest of Britain, in a referendum being watched carefully in many other countries. Some see it as a risky experiment; while others hope a successful vote for independence might energize their own separatist demands. Foreign immigrants to Scotland have a front row seat for the vote. VOA’s Henry Ridgwell spoke to some of them in Edinburgh.
Video

Video Washington DC Mural Artists Help Beautify City

Like many cities, Washington has a graffiti problem. Buildings and homes, especially in low-income neighborhoods, are often targets of illegal artwork. But as we hear from VOA’s Julie Taboh, officials in the nation's capital have come up with an innovative program that uses the talents of local artists to beautify the city.
Video

Video US Muslim Leaders Condemn Islamic State

Leaders of America's Muslim community are condemning the violent extremism of the Islamic State group in Iraq and Syria. The U.S. Muslim leaders say militants are exploiting their faith in a failed effort to justify violent extremism. VOA correspondent Meredith Buel reports.
Video

Video Bedouin Woman Runs Successful Business in Palestinian City

A Bedouin woman is breaking social taboos by running a successful vacation resort in the Palestinian town of Jericho. Bedouins are a sub-group of Arabs known for their semi-nomadic lifestyle. Zlatica Hoke says the resort in the West Bank's Jordan Valley is a model of success for women in the region.


Carnage and mayhem are part of daily life in northern Nigeria, the result of a terror campaign by the Islamist group Boko Haram. Fears are growing that Nigeria’s government may not know how to counter it, and may be making things worse. More

AppleAndroid