Quake, tsunami leave deep wounds to Japan's economy

April 6, 2011 - 0:0
The true scale of the destruction to Japan's economy wrought by the March 11 earthquake and the Fukushima nuclear crisis is starting to become apparent, with some communities facing a reconstruction effort compared to that following World War II. More than three weeks since the Great East Japan Earthquake shook northeastern Japan, large parts of the Japanese economy are still struggling to get back on their feet. The disruption is widespread and has reached far from the disaster zone. Automakers and electronics firms have been forced to suspend production because they cannot get parts. Electricity blackouts are paralyzing businesses and disrupting the lives of consumers. The ongoing crisis at the Fukushima No. 1 nuclear power plant has contaminated produce from a key agricultural area. In northeastern Japan, many local economies have been left in ruins. The earthquake crippled the two main pillars of the economy of Ishinomaki, Miyagi Prefecture: the marine products processing industry and a Nippon Paper Group Inc. factory. The Sakanamachi district, where nearly half of the city's marine products processing factories were concentrated, was devastated by tsunami after the magnitude-9.0 earthquake. ""We have been wiped out, literally,"" said Toshio Otsuka, 60, president of Taiko Corp., a major marine products processing company. ""We don't know what to do."" The district is strewn with debris and is filled with the stench of rotten fish. About 100 people gathered on March 30 to discuss rebuilding the industry, but the discussions soon stalled due in part to the sheer size of the task. ""How are we supposed to clear debris on this scale on our own?"" one participant said. Ishinomaki port's haul of fish was the third largest in Japan before the disaster. Of the city's population of 160,000, 4,664 were engaged in the marine products processing industry in 2009. Total production was valued at 52.6 billion yen ($626 million). The tsunami has also stopped operations at Nippon Paper's Ishinomaki plant, which makes printing paper for publishers. More than 2,000 people are employed at the mill and at partner businesses. Huge rolls of paper, pulled out of warehouses by the water, now lie scattered around the plant's premises. Dozens of shipping containers were smashed into the plant's buildings. Ground floor machinery is out of operation. Yoshio Haga, president of Nippon Paper, visited the city hall on March 26 and told Mayor Hiroshi Kameyama: ""We will definitely put (the plant) back into operation."" However, a date for reopening has not been set. ""The reconstruction we face is more daunting than the reconstruction from World War II,"" said Kunio Suno, 67, president of Ishinomaki Uoichiba, a fish wholesale market operating company, who is overseeing efforts to rebuild the local fisheries industry. In Namie, Fukushima Prefecture, Namie Hitachi Chemical Company has suspended operations because it is within the 20-kilometer evacuation zone around the Fukushima nuclear power plant. That suspension has now begun to affect railway networks in western Japan. The Hitachi Chemical Co. subsidiary accounts for more than 50 percent of the domestic supply of carbon brushes, a key component in train motors. Carbon brushes must be replaced once every six to 18 months due to abrasion. East Japan Railway Co. on Saturday began cutting the number of daytime trains by up to 50 percent on the Hokuriku, Sanyo and other lines. The cut will be expanded to the Osaka Loop Line in the city center and other lines from April 11. Kintetsu Corp. has also reduced the number of cars used in some limited express trains from eight to six since March 28. Namie Hitachi Chemical has handed over raw materials and design drawings to a rival company and asked that company to try to fill the demand. But railway operators still face severe disruption because it requires several months to complete some products. In Iwaki, an industrial city in Fukushima Prefecture, most of the 70-plus companies at the Iwaki Yoshima industrial park, including Alpine Electronics Inc., restarted operations on March 28. The industrial park is located a little more than 40 kilometers from the Fukushima No. 1 nuclear power plant. But Shinichi Muto, who heads an association of industrial parks in Iwaki, is concerned that some companies may have to halt operations again if the government extends its current recommendation that people stay indoors from its current 30-kilometer radius to 40-km. The Tokyo Disney Resort, about 200 km south of Iwaki, has been closed since the earthquake. While restoration work on parking lots damaged by soil liquefaction has progressed, electricity shortages remain a key concern. If the electricity supply stabilizes, the operator, Oriental Land Co., plans to reopen the theme park complex, but hours will likely be limited to daylight in the short term. Power-hungry night events, such as the Electrical Parade, are unlikely to be practical. The Tokyo Disney Resort consumes electricity each day the equivalent of about 60,000 households. ""We are wondering if (power-hungry events) will be accepted by a public that is trying to save as much power as possible (due to rolling blackouts),"" said a senior official of Oriental Land. (Source: Asahi Shimbun)