Japan approves $50bn for reconstruction
The twin disasters destroyed roads, ports, farms and homes and crippled a nuclear power plant that forced tens of thousands of more people to evacuate their houses for at least several months. The government said the damage could cost $309bn, making it the world’s most expensive natural disaster.
Prime Minister Naoto Kan said he was moved by conversations with victims during a tour of shelters.
“I felt with renewed determination that we must do our best to get them back as soon as possible,” he told reporters.
The government approved an extra $50bn to help finance the rebuilding, in what is expected to be only the first installment of reconstruction funding. About $15bn will go to fixing roads and ports and more than $8.5bn will go to build temporary homes and clearing rubble.
“This is the first step toward rebuilding Japan after the major disasters,” Finance Minister Yoshihiko Noda said.
More than 27,000 people are dead or missing after the earthquake and tsunami hit northern Japan on March 11. About 135,000 survivors are living in 2,500 shelters in schools and community centres. Many others have moved into temporary housing or are staying with relatives.
As part of the government’s recovery plan, it will build 30,000 temporary homes by the end of May and another 70,000 after that, Kan said.
Kan, under fire for his handling of the crisis, said Japan would have to issue fresh government bonds to fund extra budgets to come, and suggested he would stay on to oversee the process.
“I feel it was my destiny to be prime minister when the disasters and nuclear accident took place,” Kan told a news conference.
“I want to work for reconstruction and rebuilding, and present an outline to overcome these two crises. To have that vision in sight is my heartfelt desire as a politician.”
Financing the next packages will be much tougher, as they are likely to involve a mix of taxes as well as borrowing in the bond market, which could strain Japan’s debt-laden economy.
If Kan is unable to steer those laws through parliament, he may be forced to step down, analysts say.
Prime Minister Kan, who has been accused by opposition politicians, his own party and quake survivors of failing to take command of the response to the triple disaster, has said the need to rebuild is an opportunity for national “rebirth”.
In a Reuters poll of retail investors, 83% of those surveyed said they disapproved or strongly disapproved of the administration’s handling of the crisis.
As well as trying to rebuild the ruined northeast of the country, Japan also has to contend with the world’s worst nuclear crisis since the 1986 Chernobyl disaster, the wrecking of the Fukushima Daiichi plant, 240km from Tokyo.
Radiation spilled out from the facility after a hydrogen explosion, and in their battle to cool melting fuel rods, engineers pumped radioactive water into the Pacific, a move that worried Japan’s neighbours about the spread of contamination.
Japan said this week it would ban anyone entering a 20km evacuation zone around the plant.
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