Uncertainty for Russian economy after Japanese disaster
As the world's third largest economy, Japan might reasonably be expected to cope with last week's earthquakes relatively calmly.
And initial responses from Tokyo were intended to prevent any threat of panic: on Saturday the central bank allocated $670 million to support 13 banks in the areas bearing the brunt of the quake.
Then on Sunday it offered to provide up to $25 billion of liquidity for the banking system as a whole, and injected $183 billion on Monday morning.
But it remains unclear how damaging the quake will be for Japan's economy and how the knock-on effects will be felt among the Pacific economies, including Russia's.
Kobe or Hiroshima?
Japan's government has said that the disaster is the greatest to befall the country since twin atomic bombs brought World War II to a close.
But the largest Japanese investment bank, Nomura, believes that the total impact will be closer to the consequences of the 1995 Kobe earthquake, which cost about 2.5 per cent of the country's GDP, Kommersant reported.
Meanwhile, the shutdown of Japan's nuclear power industry is likely to mean increased demand for oil, coal and gas something Russia has already rushed to assist in meeting potentially pushing prices higher.
But a contraction in the Japanese economy would also have an impact on the car industry.
Globally, components and spare parts are frequently sourced from Japan and there could be a decline in car production worldwide.
That could have a specific impact on planned Russo-Japanese joint ventures such as the proposed tie-up between Toyota and Sollers to build vehicles in the Far East.
Flooded by cars
Russia, especially the Far East, has long been a final resting place for second-hand Japanese vehicles.
And with thousands of vehicles "drowned" in the tsunami and subsequent flooding, auctioneers are bracing themselves for a torrent of unwanted cars coming from the east, Autobusiness.ru reported.
The portal said that many Russians are willing to buy cheap, damaged vehicles in the hope of refurbishing them to sell on at a profit.
But experts warn that sophisticated electronics are often irreparable after being submerged, and expensive cars lose much of their resale value as a result.
Uncertainty
In a market briefing, UralSib's analyst Chris Weafer noted that mid-session figures in the regional markets showed relatively small changes on Monday, despite a predictable dip in the Tokyo bourse.
"Because of the unprecedented nature of the catastrophe in Japan and the rapid injection of $183 billion in the economy by the Bank of Japan nobody has any idea of the longer-term implications for the regional or global economy," he commented. "That may not be clear for weeks."
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