I have not posted on Japan for a while. But today’s NY Times has an article suggesting that Japan has finally placed a figure on its recovery from March 11th at $157 Billion and the article also provides the following info:
“Japan is still reeling from the sheer extent of the damage unfurled by its recent earthquake, tsunami and subsequent nuclear crisis. At the end of June, damage from the quake and tsunami alone had already reached $210 billion, according to estimates by Munich Re, a German reinsurance company.
That makes the events of March 11 the world’s costliest disaster, surpassing Hurricane Katrina, which caused about $125 billion in economic damage, according to Munich Re.”
First, the USA actually has no exact numbers on Katrina and probably never will but my estimate is less than $60B has been spent if insurance claims are excluded. Second, the Japanese IMO spent $250 B recovering and rehabbing KOBE its largest port from the January 1995 earthquake. That effort totally rebuilt KOBE from the ground up and did not just restore it to pre-earthquake status. Note that traffic at KOBE has yet to obtain pre-earthquake levels.
I had estimated that somewhere between $200-300B in losses occurred directly and indirectly from the March 11th event while the initial Japanese government estimate was $50B. Hey probably just lucky but there were huge pressures on the Japanese to minimize initially damages and losses (not the same thing)! So glad to see some confirmation of my back of the envelope estimates.
You can check earlier postings on this blog however and you will see I predicted decades of efforts by the Japanese to recover and a need to spend over ONE Trillion in dollar equivalents during the first post disaster decade.
So time will tell whether the Japanese effort is adequate. I really do wish the economists would start paying attention to disaster outlay statistical information and not just rely on the insurance business to provide numbers (they have an incentive to maximize losses both to stimulate new sales and to get face time with the public)! And also not to rely on the federal government or any nation-state statistical data for actual numbers. ONE of the things that most irritate me about the USA disaster outlay numbers is that it is never consolidated so that this years drought and heat could well result in huge Department of Agriculture outlays for crop disaster relief. These AG programs often exceed even FEMA outlays in any given year.