Japan quake cleanup could swamp with debt

5:16 AM cleanup, could, Japan, Quake, swamp No Comments

It at the beginning of reconstruction of the worst natural disaster in the history of Japan's economy is a greater threat than the destruction of a relatively small portion of its industrial production: debt.

To pay for the reconstruction, billions of dollars in fresh borrowing of a debt, the Japanese Government must pile, which already is one of the largest in the world.

Last week devastating 9.0 earthquake and the resulting 30-foot tsunami only was to latest blow to an economy that has fought, again on its feet two decades after the collapse of a large financial bubble.

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"Japan have a terrible set of problems, which it now were fighting for more than 20 years has", said Steven Roach, non - Executive Chairman of Morgan Stanley Asia. "she have to rebuild the financial system." And they have the most powerful demographic headwinds of each economy in the world: their population is not only aging, it goes back. "

These two "lost decades" four recessions and links with growth virtually flat lining, growing GDP, on average, less than 1 percent per year. Long before the earthquake struck, the Japanese economy had expected forecasters continue to customer in the next few quarters.

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Japanese Government to try to revive growth, issues were strong, but with little lasting impact, except to build a mountain of loans which are repaid. At approximately double its annual GDP has Japan of one of the world's highest public debt, second only to the Zimbabwe, according to the CIA factbook. On the other hand, is the United States to place 36, with a public debt of around 60 percent of GDP.

Now that it is a big relief for you and reconstruction efforts, Japan more to cover the costs, emissions must the provisional estimates place about 200 billion dollars. The risk is that how it on more debt piles, the Japanese Government to higher interest rates to investors continue to demand for these new bonds pay.

"Printing they all this money to out of this mess and eventually interest with all will increase this pressure", said Lawrence McDonald, President of McDonald's Advisory Group, an investment firm management. "A single % increase in interest rates is equivalent to 25 per cent which is their tax revenues."

Higher also makes it more expensive for businesses and consumers to borrow, it a damper on spending and investment and create a further headwind for the Japanese economy.

It is unclear how much money of the Government will have to borrow. The reconstruction to cover costs is expected to only a relatively small part of private insurance. This is because Japan has a comprehensive, Government-backed earthquake insurance program, which covers some individual owners and backstops insurance companies of large losses. First estimates put total losses covered by private insurance companies to not more than $35 billion, or about 6 percent from the estimate of overall loss.

This means that some of the cut the cost of reconstruction out of the Pocket, back in profits and consumer spending have to pay are companies and consumers.

Japan's economy takes a hit from the industrial production of damage Quake to factories closed. There were imminent for parts and components, especially for the electronics and auto isolated reports of shortages.

But Japan is a large diversified economy and the disaster area is a relatively small portion of the country's GDP. Economists also note that the devastating loss of any major natural disaster, especially in a developed country such as Japan, usually heavy expenditure and investment in the reconstruction, all follows that helps to promote growth.

"I not attempts to say, there are no problems," said Steven Wieting, Citigroup Director of the economic and market analysis. "But also radiological disaster, Chernobyl, three mile Iceland, what happened with the deepwater horizon in the last year, it is a lot of emotion and concern." "But none of the events, including the earthquake in Kobe, all these natural disasters not long-term, lasting economic impact."

As for the global economy, despite isolated parts lack of Japanese suppliers the Japan earthquake is "Not likely to global trade be significant" and the impact on the Japanese economy will likely "be, localized" according to FedEx CEO fed Smith.

"" You put this way: If we unfortunately one terrific tragedy in Arizona "or saying"Oregon art on the periphery of the country had, it would be terrible,".""But the rest of the United States in all probability would continue operation."

Yen rises
The value of the yen is a potentially larger problem of the recent increase in Japan. The quake induced surge is the result of the various forces, according to currency market observers. Japanese insurance companies and other companies and investors are believed, have sold other currencies loud, cash back home to increase on foreign assets. The scramble to buy Yen has forced its value.

Forex traders have increased movement, by you betting on the rise. That a coordinated effort, the first since the year prompted the central banks of the seven largest industrial countries Thursday, 2000, to agree to hold to the value of the yen in check.

A rising Yen could be with a larger problem than what the Japanese Government may be relatively small damage to its industrial base. Verteuert pay a higher Yen Japan products for everyone in the rest of the world for them with a different currency. That makes Japan's exports less competitive in the global market and offers international companies one more reason to look for other suppliers.

The latest round of government borrowing presents a conundrum for Japan's central bankers, who have fought for years to keep economy with a policy (also more recently by the US Federal Reserve) called "quantitative easing." low interest rates the policy to by dramatically expand the money supply, Keeping interest rates low to stimulate borrowing and revive growth.

It did not work in Japan. Now, as the Japanese Government market with new debt floods, the Central Bank must continue to purchase the bonds if private investors on the plate and help finance of the country's reconstruction efforts intensify not.

Japan's malaise could be eerily familiar in some US officials. The Fed is in his second over, about $600 billion buy bond in June, a response to the collapse of the much younger American financial bubble. As now with its large debt burden Japan, could learn U.S. policy makers from Japan's experience, according to Roach, much.

"Twenty years later, the post-bubble experience the Japan all must give US pause to think, above all those of us in the United States, who believe that it could never happen us", he said. "These are very devastating events and there are lessons in Japan, I think, many of us have not learn."

© 2011 msnbc.com reprints

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Cost for Japan Quake seen up to $200 billion

11:58 AM billion, Japan, Quake No Comments

TOKYO - Japan's devastating earthquake and deepening nuclear crisis could lead to losses of up to $200 billion for the third-largest economy in the world, however, the global impact remains difficult to assess smash five days after a massive tsunami in the North-East Coast.

As Japanese officials, encrypted to 240 km (150 miles) North of the capital Tokyo avert a catastrophic meltdown of a nuclear power plant, assessment of the damage to buildings, production and consumer activity moved economists.

The disaster is expected, to Japanese Edition strongly in the coming months beat, but economists warned that it could lead to a deeper slowdown, if makes deficiency prove significant and persistent, delay, or even the "V shaped" recovery, that the earthquake of Kobe 1995 followed scotching.

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Most believe that the direct economic results between 10-16 trillion yen ($ 5.125$ 200 billion), which is total to a decline in gross domestic product (GDP) in the second quarter, but a sharp rebound in the second half of 2011 as reconstruction investment growth increases.

"The economic costs of the disaster will be great," said economists at JP Morgan. "There are significant loss to economic resources and economic activity damage (such as power outages) will be hampered by infrastructure in the weeks or months."

Their suffered Japanese shares worst two-day rout since the crash in 1987 on Monday and Tuesday, a whopping $ 626 billion lose value before 5.7 percent recovered fell on Wednesday as hedge funds to cover short positions.

But traders remained shy, influenced by each of the new development of the affected Fukushima and warning sign was substantial foreign assets to sell and funds to cover the costs of the nuclear crisis Japanese companies and insurers, Quake and tsunami to repatriate.

High-yield bonds and U.S. treasuries of health care jobs top the list of endangered assets the triple disaster of earthquake, tsunami and nuclear breakdown prompt Japanese investors to overseas funds should say back home, analysts.

Although the damage to the infrastructure is more difficult, some of the biggest risks for the economy can dating indirect market effects of the disaster, such as a rise in the yen.

The yen Fund rose to an all-time high against the dollar after the Kobe earthquake in 1995 during Japanese companies home drawn. The dollar has 3 percent against the yen since the disaster and is now close to the low pressures you to Kobe.

The direction of the yen would have a major impact on Japanese automakers such as Toyota Motor Co., Nissan Motor and Honda Motor, that between 22 and 38 percent of their cars at home build.

HSBC Chief Economist Stephen King said it was too early, put numbers on the economic cost, since the scale of the disaster was not yet clear.

Area of the Japan produces about 4.1% of GDP of the country affected by the tsunami, he said suggesting that first round economic impact could be limited. But the fate of the Fukushima nuclear reactors Japan can have not felt still unclear, the full force of the disaster still.

"At this time, it is too early to come up with reasonable estimates of the overall impact of the terrible events in Japan," wrote note King in a research.

He noted "knee-jerk economic and reactions to shocks and disasters often wide of the mark fall," on faulty predictions a US recession following the attacks of September 11, 2001 and a hit from the Asian tsunami in 2004.

The disaster is already by the global production chain, technology companies as output particularly hard meets Japan accounts for one-fifth of the worldwide semiconductor disturbed.

However, the Fed made no mention of Japan in a statement given the high degree of uncertainty about the global economic impact of the disaster, after its policy meeting on Tuesday.

Story: quake insurance industry well shielded from Japan

The European Central Bank, which earlier this month that it could hike prices in April, also appears warned, in wait-and-see mode as financial markets reduce their expectations for the tightening of monetary policy this year.

Fitch Ratings said that it justifies currently view action, the economic effects as sufficiently serious negative rating on Japan's well diversified economy and sovereign finance show flexibility.

The size of its $5.3 trillion is debt of Japan's economy, the highest proportion of all major developed countries in the world twice. But in contrast to other highly owed countries as Greece, only five percent debt is held of Japan by the foreign investors, so the risks of a financial crisis are limited.

Still, said in a sign that the European Heads of State and Government nervous may it a meeting of G7 Finance Ministers and central bankers to deal with the crisis, had called on their dissemination to Japan debt crisis after the disaster, France, where possible purchases of Japanese debt.

Credit rating agency of Moody's warned earlier this week, that she quake, tsunami and resulting nuclear crisis increased confidence in Japan's finances to lose the chance of investors and eventually calls for higher rates on government bonds.

Now the Government is using 200 billion yen in the emergency reserves to pay for anti-crisis efforts. The fast-developing disaster has prevented that Government officials from working on an emergency could be budget in the range of 5-10 trillion yen.

Some ruling party legislators have to pay a special tax proposed for disaster relief, but Finance Minister Yoshihiko Noda allies said that he is considering not tax increases.

In a bid, reassure investors who not uncontrolled spin be fiscal conditions, Japan has limited sales at 44 trillion yen in the last years new bond, but this ceiling should now be scrapped.

"Basically, the Government must cap, scrap the 44 trillion yen", said Seiji Adachi, an economist at Deutsche securities in Tokyo. "It is an emergency necessary budget as soon as possible, at least in the next one to two months to compile."

Large fund injections of the Bank of Japan keep as far as borrowing costs low and there are no signs of strains in Japan's financial system.

Sources said Reuters, which probably was last purchases the Central Bank, which makes it easy monetary policy by a doubling of funds for asset to 10 trillion yen on Monday, further steps as soon as next month.

Copyright 2011 Thomson Reuters.

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Isolated from Japan Quake insurance industry

2:18 PM industry, insurance, Isolated, Japan, Quake No Comments

Japan's massive earthquake, tsunami and nuclear disaster should not, likely, the most expensive natural catastrophe on the files, but the impact on the private insurance industry that Hurricane Katrina will exceed in 2005.

This is partly because Japanese House and apartment owners and companies heavily leave insurance system, rather than private insurance on a State-funded earthquake. As a result, only about 14 to 17 percent of the Japanese houses private earthquake have insurance, estimates the reinsurance Association of America.

The Japanese system is also a cap on total damage by the Government and private insurers paid. If total claims about above, are $60 billion payments pro-rata which means that House and apartment owners and companies would have to for a partial coverage of their losses to settle.

This is a relatively small payment for the private insurance industry, and it is distributed to more than one player.

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Nevertheless, be the total cost of the last week 9.0 magnitude quake and resulting tsunami astronomical. Estimates put total losses at $180 billion private bank, a figure which could later when leaks from a crippled nuclear power plant further damage, radiation

The figure on the files would - making Japan the most expensive natural catastrophe earthquake greater than Hurricane Katrina, the losses created $125 billion and some 1,300 people killed in the year 2005. Losses were about half of Katrina's insurance, which covers the insurance industry, in a $66 billion.

Story: Quake economic hit from Japan up to $200 billion seen

Thanks to the limits of liability and a longtime financial attack by the Japanese Government, the cost of the quake of Sendai, the private insurance industry will be probably far lower. Most cited widely estimates of insured damage comes from AIR worldwide, insurance consultant, who provides these losses in the range of $ 15 billion to $35 billion. This figure, the tsunami damage not cover could increase according to Jayanta Guin, AIR worldwide head of research and modelling.

"It is too early in the episode;" We hundreds all geophysical data and simulation of ground motion and estimate damage based run computer simulations using this simulation, "he said." "We are working out the details to see whether we can further customize it."

Insurance premiums rose after Katrina, but are unlikely this time around say to do analysts

The insurance impacts from the Sendai Quake likely above all of the Japanese domestic non-life insurance and life insurance industries "with a healthy portion of the community together global reinsurance" absorbed, said Robert Hartwig, President of the insurance information Institute, an industry group.

The biggest wild card estimates is damage the threat to life and property by the crippled Fukushima Dai-Ichi nuclear plant, which was leaking radiation. These potential costs are recognized, but the private insurance industry is fully shielded from the financial effects.

After the Japanese nuclear Act of 1961 operators of nuclear plants for any damages liable as a result of a "severe disaster of an exceptional nature," according to the reinsurance Association. Tokyo electric power, the plant operator, has its own private property insurance for the work, but analyst at Swiss Bank Vontobel is excluded from the directive according to Stefan Schurmann damages due to earthquakes and tsunamis.

He said "These disasters by the property and casualty insurance policies are excluded,".

If insurance companies Quake purchases of large natural disasters such as the Japan and tsunami face, they are based generally on the other, larger insurers - so called "reinsurers", which serve as a backstop, when losses get too large. After raising the reinsurance industry keeps premiums after the large losses from Katrina, currently surplus capital from $50 to $70 billion, according to investment bank Credit Suisse.

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The financial hit in the reinsurance industry will be tempered by payouts on private insurers by the Japanese Government, provides a separate earthquake reinsurance attack to the Japanese insurance industry. All of this global reinsurers can be well positioned to handle what could be the most expensive natural disaster in history.

Could contribute to, another round of increases as the moderate, which followed the huge payouts from Hurricane Katrina.

Insurance premiums cause usually in cycles, increases in so-called "hard" markets, if heavy losses insurers premiums to enforce, and fall into the "soft" markets, if large cash spark competition to new customers and discount discounts pillows.

Although the cost of the coverage of the earthquake Japan can be manageable, a string of losses, the more than $50 billion, including the large payouts on damage from the recent earthquake in Chile and New Zealand and floods in Australia have total results. So even before the earthquake of Japan, the cycle was swinging again created by surpluses of accumulated post-Katrina from the "soft" market.

But while premiums rise in Japan is expected, analysts say consumers anywhere else in the world probably not see large increases - if and as long as a more major disaster hits.

© 2011 msnbc.com reprints

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Japan Quake economy will already come

4:38 PM already, economy, Japan, Quake No Comments

 TOKYO Japan's central bank on Monday rushed to bolster markets in the wake of the country's worst disaster since World War II, and although the authorities said it was too early to put a figure on the damage, critics said a stronger initial response had been needed.

Global stock markets swooned at the shock of an 8.9 magnitude earthquake and a tsunami that may have killed more than 10,000 and has left millions of people without power, water or homes.

Japan's Nikkei stock average closed Monday down 6.18 percent, losing over 600 points and registering its biggest single-day decline since October 2008. The sell-off on the Tokyo Stock Exchange wiped some 23.5 trillion yen ($287 billion) off the market's value.

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At the same time, engineers were battling to prevent a nuclear meltdown at the Fukushima Daiichi complex owned by Tokyo Electric Power Co (TEPCO), where three reactors threatened to overheat in the worst atomic power accident since Chernobyl in 1986.

Investment bank Credit Suisse put economic losses from the quake at no less than $171 billion, although Finance Minister Yoshihiko Noda said it was too early to put together a firm figure to compile a supplementary budget.

Insurance companies are looking at billions in losses from the earthquake and tsunami, with one early estimate placing the figure as high as $60 billion, which would make the disaster the most expensive ever behind Hurricane Katrina.

"Given the enormity of the earthquake that struck Japan ... it is still in the very early aftermath of the event," said Jayanta Guin, senior vice president of research and modeling at AIR Worldwide, which has put early estimates for insurance costs at $15-35 billion.

"Search and rescue efforts are still underway and damage assessment has only just begun, while considerable uncertainty still remains in the seismic parameters that define the event," added.

A Credit Suisse report suggested initial insurance cost estimates ranging from $10 billion to $50 billion.

Barrie Cornes, an insurance analyst at Panmure Gordon & Co. in London, warned that with the tsunami bill added in, the cost to the global insurance industry could rise above $60 billion dollars.

The Bank of Japan doubled its asset buying scheme to 10 trillion yen ($122 billion) Monday and held interest rates at 0-0.1 percent after it earlier said it would pump a record 15 trillion yen into the banking system, though some economists said it could have done more.

A swathe of high profile Japanese manufacturers, including Sony Corp, Toyota Motor Co and Panasonic have shuttered production lines, with restart efforts hampered by quake aftershocks.

About a fifth of the country's nuclear power generation capacity has been shut down by the disaster. Thermal plants also shut down, forcing the world's third-biggest economy to instigate rolling blackouts to conserve energy.

"The tremors will likely continue for one to two months, experts say, and are continuing now, so there's an immense amount of uncertainty and unclear points." said Masayuki Kubota, a senior fund manager at Daiwa SB Investments.

Economists said that the triple blow of quake, tsunami and nuclear accident is set to damage the already struggling economy harder and longer that initially expected.

Analysts have grown increasingly cautious about forecasting a quick economic rebound similar to that after the Kobe earthquake in 1995, thanks in part to Japan's indebtedness which at twice the size of gross domestic product means the government has less room for maneuver.

Some say a recession is possible.

"Power supply is a critical factor," said Michala Marcussen, head of global economics at Societe Generale. "If power production output is damaged in a sustainable fashion, that could have a durable impact on the economy.

Monumental task
TEPCO, the biggest power company in Japan, said on Sunday rolling blackouts would affect 3 million customers, including large factories and buildings from Monday onwards. It aims to end the blackouts by the end of April.

Policymakers face a monumental task reviving the economy, not only because of the scale of the disaster but because of their limited options.

After the Kobe earthquake, the government adopted an extra budget worth around 3 trillion yen.

"This time, the government can't afford to spend as much as after the 1995 quake given Japan's dire fiscal situation," said Takuji Okubo, chief economist at Societe General in Tokyo, who reckons a more realistic figure to expect is 1 trillion yen.

The Bank of Japan (BOJ) had little room to move on rates, thanks to the legacy of the global financial crisis and years of economic stagnation, in stark contrast to New Zealand, where the central bank last week slashed interest rates by half a percentage point to 2.5 percent to support an economy hit by a 6.3 magnitude earthquake on February 22.

"My initial impression is that the BOJ could have done more. Its traditionally reserved stance on policy easing remains in place even after the massive earthquake," said Masamichi Adachi, senior economist at JPMorgan Securities Japan.

"The BOJ also kept its economic assessment unchanged. The bank thus seems to be not fully taking account of strong uncertainty shrouding Japan."

Stock shock
The benchmark Nikkei stock average fell Monday amid concerns about rolling power blackouts hit the value of auto and electronics firms and the yen slid against the dollar.

Electronics giant Sony, maker of the Playstation gaming console, dropped 9.1 percent by the close of trade. The firm has suspended production at eight plants. Carmaker Nissan Motor Corp fell more than 9.5 percent after it shut down all four of its auto assembly plants in Japan.

"It will take quite some time until investors' confidence in Japanese manufacturers returns. When we look back at the Kobe earthquake, it took about a week to get an overall picture of magnitude of the damage," said Toshihiko Matsuno, senior strategist at SMBC Friend Securities.

The prospects of a massive recovery effort boosted contractor companies. Kajima Corp jumped more than 22 percent and Hazama Homes more than 19 percent.

The market impact of the disaster will be felt far beyond Japan. Companies that trade with Japan face a loss of business and worries that governments will look at nuclear power less favorably.

Story: Japan accident dims odds of U.S. nuclear revival

Almost 2 million households are without power in the freezing north and about 1.4 million lack running water.

Kyodo news agency said 80,000 people have been evacuated from a 20-km (13 mile) radius around the stricken Fukushima nuclear plant, adding to 450,000 evacuees from the quake and tsunami.

An explosion rocked the number 3 reactor on Monday although Jiji news agency said the core container was intact. TEPCO shares were untraded as sell orders outnumbered bids 200 times.

The complex was rocked by a first explosion on Saturday, which blew the roof off a reactor building. The government had said further blasts would not necessarily damage the reactor vessels.

TEPCO said on Monday it had reported a rise in radiation levels at the complex to the government.

Authorities had been pouring sea water to keep the fuel rods in the reactors cool. Nuclear experts said it was probably the first time in the industry's 57-year history that sea water has been used in this way, a sign of how close Japan may be to a major accident.

"Injection of sea water into a core is an extreme measure," Mark Hibbs of the Carnegie Endowment for International Peace. "This is not according to the book."

The Associated Press and Reuters contributed to this report.

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Quake damage estimate for Japan is at $180 (b)

10:42 PM damage, estimate, Japan, Quake No Comments

LONDON - earthquake affected Japan reconstruction is a bill of at least $180 billion, or 3 percent of its annual economic output, or more than 50 percent higher than the total cost of the 1995 of earthquake in Kobe.

Although some extreme projections of longer-term costs figures closer to $1 billion over several years project, tally standard similar to that after the Kobe Quake hover around this level used.

Third largest economy in the world, already twice as big as his five trillion dollar issue, with public debt gesattelt must rebuild its infrastructure - roads and rail to makes and ports - on a scale since the second world war no longer.

Moody's investors service warned on Monday that the huge financing needs Japan faces investor confidence in the ability of the country, repay can undermine price gouging borrowing costs.

Moody's lead analyst Tom Byrne said "the earthquake of such a potential tipping point is slightly forward, have moved if also address galvanized Japan's political parties by the crisis are the country's long-term fiscal challenges," in a statement.

The Quake and tsunami have at least 10,000 people, officials estimate, striking a North-East, the accounts for an estimated 6 to 8 percent of gross domestic product, compared with 12.4 percent from the areas affected by the Kobe Quake 1995 killed.

However sees the loss of assets and human capital from Friday quake, which triggered several explosions at a nuclear power plant North of Tokyo, to be far greater. It comes at a time when oil is a 2-1/2-year Summit, floats and other commodity prices remain elevated.

The economic damage should shave only a sliver of world economic growth and tens of billions of dollars spent on the reconstruction of boost should eventually Japan's economy and Asian construction industry.

But analysts also say, first estimates ringing could cost.

"From the experience, there are to underestimate a trend", said Brendan Brown, head of economic research of Mitsubishi UFJ securities.

"There are many uncertainties - we do not know how long power outages will last, and this is a running costs in addition to the reconstruction." It is a loss of output of dislocation. If for two months, is going to dwarf the cost of reconstruction can, "he added."

Rolling blackouts
The Kobe earthquake is estimated to be $115 billion on $118 billion, or 2 percent of GDP in 1995 with regard to costs. This time - in a still unfolding catastrophe - from Credit Suisse and Barclays put initial estimates the cost at $180 billion.

Mitsubishi UFJ securities and Sarasin expect that up to 5 percent of GDP could run the costs.

Mitsubishi estimates take into account a larger economic costs, including a loss of tax revenue, subsidies for different sectors which the affected area, a loss of productivity to rolling blackouts over just reconstruction costs.

Rough estimates show, replacing a nuclear power plant alone can cost $5 billion. Desperate to avert a nuclear meltdown, Japan, sacrifice three of its nuclear reactors had by pumping sea water to cool reactor cores.

Insured losses from Japan's earthquake could be as high as $35 billion, also without tsunami - and nuclear losses.

Story: Disaster in Japan proposes an already ailing economy

Mitsubishi UFJ Brown says historical estimates of the Tokyo earthquake 1923 put destruction as equivalent with 50 percent of annual economic output at the time, but the economic context was so different to make direct comparisons not very fertile.

Fitch Ratings said in a statement that you believe that during the earthquake the losses to the largest insured losses in the history of are, from the first, and reinsurance industry without widespread solvency problems or excessive financial burden included.

Cost of capital
But some estimates of the costs of the reconstruction shoot far higher than this consensus forecasts economists are taken into account the potential of the country's devastated capital stock over a longer period must be replaced.

Vanessa Rossi, senior research fellow at the London think tank Chatham House, estimates that in the earthquake, this corresponds to 10% of the share capital of Japan's lost about 20 percent of the country's GDP, or $1 trillion.

Story: Japan accident dims odds of the U.S. nuclear revival

"The major cost is share capital reconstruction." This type of problem really caused damage to the capital. There are enormous damage to the infrastructure installations, power plants, housing, factories, ports, coastal landscape, "said Rossi."She could not possibly so comprehensively new create years in the period of 1-2. "I expect it to 4-5 years would work."

She said also Japan's rich private sector debt-ridden Government was probably by the sale of its foreign assets complement and under use secure reserves, which could weigh on the international markets.

Paul Newton, auto industry analyst at IHS global, of the damage to the car sector, said the reconstruction had to include to get much more than just the country's production, the economy back on its feet.

"The tragic loss of life and homes across the region means that even if fixed infrastructure and facilities can entire communities, that many of these plants having have uprooted have or still missing are," he said.

Copyright 2011 Thomson Reuters.

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