Japanese reconstruction may boost GDP growth
Experts suggest the massive Japanese earthquake may push up the country’s gross domestic product (GDP) as a result of the reconstruction efforts but Japanese equities and insurers are likely to suffer.
A report from Citi expects reconstruction demand will materialise in the second half (H2) of 2011, eventually pushing up GDP.
“We estimate the net impact on GDP growth in 2011 at +0.2% to 0.3% points,” said Citi.
This supposition was supported by rating’s agency Moody’s.
“Reconstruction spending will likely prove to be a very effective and justifiable fiscal stimulus. Such expenditure will likely offset the economic impact from immediate losses in production and demand,” it said.
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