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Japan disaster to cause limited GDP impact
For the global economy, I think this is a one-time shock and overall it will not have a long term impact: Wbank.
Johannesburg: The impact of recent natural disasters and the resulting nuclear crisis is unlikely to have a prolonged impact on Japan's economy, World Bank chief economist Justin Lin said on Wednesday.
Lin told journalists at the University of Johannesburg that with reconstruction, Japan could increase its growth rate after six months.
"Certainly it's a big shock on the Japanese economy," Lin said.
"They are going to have some loss to their GDP but according to our estimates it may not be so large. And also with reconstruction they can increase their growth rate after 6 months," Lin added.
Experts say the world's third-largest economy will take at least five years to reconstruct its earthquake and tsunami afflicted regions as it balances the need to rebuild houses, roads and power grids with planning for disaster-proof infrastructure.
Fears that the Japan disaster will lead to a slowdown in the global economy, saw investors pull out from risky assets in the past few days and Japan.
But those fears eased on Wednesday as the Japan's benchmark Nikkei 225, rose nearly 6 percent following two days of sharp declines.
"For the global economy, I think this is a one-time shock and overall it will not have a long term impact," the World Bank's Lin said.
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