10 Apr '11, 11pm

Japan's post-disaster economy faces electric shock

Japan's post-disaster economy faces electric shock

TOKYO: Japan's economy, the world's third-largest, has been in trouble for nearly a generation, but nothing prepared it for the brutal impact of power shortages following the March 11 disaster. The 9.0-magnitude earthquake and subsequent tsunami knocked out a sizable portion of the nation's electricity supply, creating a ripple effect that has spread throughout the economy and leaving Japan with a new kind of problem. "Over the past twenty years, the primary cause of economic downturns has been deficient aggregate demand," BNP Paribas chief economist Ryutaro Kono said in a research note. "The economic contraction expected now, however, will be largely due to severe supply constraints." Put simply, the main challenge now facing Japan is getting companies to produce more, rather than cajoling consumers to spend. Central to that conundrum lies the power company most severely ...

Full article: http://www.channelnewsasia.com/stories/afp_asiapacific_bu...

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