Asia-Pacific natural disasters take heavy toll in 2011

By dpa correspondents Dec 19, 2011, 12:41 GMT

Bangkok - Asia-Pacific suffered several natural disasters in 2011, kicking the year off with devastating floods in Australia and ending it with tropical storm Washi in the Philippines.

In between, there was New Zealand's earthquake of February 22, followed by Japan's deadly earthquake and tsunami on March 11 that caused meltdowns of nuclear reactors, and Thailand's devastating floods of October and November.

Nature took its toll, both in terms of human lives lost and damages done to local economies and the global one.

The death toll from Australia's Queensland floods was 35; New Zealand's Canterbury earthquake killed 181 people; the magnitude-9.0 earthquake and tsunami killed more than 15,800 in Japan; Thailand's worst floods in five decades claimed 730 dead; the storm Washi and resulting floods killed at least 650 people in mid-December.

The disasters were felt around the world, interrupting global supply chains, slowing exports and raising production costs.

The Queensland floods, which covered an area the size of France and Germany combined, knocked out three-quarters of the state's coal mines and devastated cotton, sugar cane and wheat crops.

Coal production worth 8 billion Australian dollars (7.8 billion US dollars) was lost. Coal represents 10 per cent of Australia's exports and 2 per cent of its gross domestic product.

Japan's earthquake and tsunami damages were estimated at 235 billion dollars, setting a world record, according to the World Bank.

The bank estimated Thailand's flood toll at 21.3 billion dollars in damages and 23.9 billion dollars in lost opportunities.

It was definitely a bad year for the reinsurance business.

Munich Re, the world's biggest reinsurer, by mid-year announced that the early string of major natural disasters had already amounted to losses totalling 265 billion dollars.

Losses from Japan's earthquake and tsunami were almost double the 125 billion dollars in economic losses resulting from Hurricane Katrina in the US 2005.

Japan represented insured losses of about 30 billion dollars, about half the amount incurred because of Katrina, Munich Re said.

Reinsurance claims in Australia, New Zealand, Japan and Thailand this year may prompt global reinsurance firms to raise their catastrophe premiums across the board next year, said Fitch Ratings, a global credit rating agency.

Munich Re, estimated losses from the Thai floods would be around 670 million dollars before taxes, according to Fitch.

The disasters in eastern Japan and central Thailand, major industrial hubs for both countries, also created global production shortages in major sectors such as electronics, electrical appliances and automobiles.

Japan is one of the world's leading exporters in all three sectors, and Thailand has been one of its main offshore production bases for the past two decades.

The floods swamped seven major industrial estates in Thailand's central provinces, shutting down production in hundreds of factories.

The disaster forced the world's leading hard disk drive producers Western Digital Corp, Hitachi Global Storage Technologies and Toshiba Corp to close shop for months.

Thailand accounts for 40 to 45 per cent of the world's production of hard disks. According to the International Data Company research group, personal computer shipments could drop by 20 per cent in the first quarter of 2012 as a result of the floods.

Fitch Ratings analysts have estimated that computer sales may decline 8 per cent next year because of production slowdowns.

'We have typically seen a negative shock to output with a subsequent bounce-back as reconstruction occurs,' said Andrew Colquhoun, Asia-Pacific head of Fitch Ratings.

'There is scope for an impact on long-term economic performance and on credit-worthiness if disasters prompt firms to rethink investment strategies, to make them switch investment to other countries, but it is too early to distinguish any such impact.'