Japan Quake is World's Costliest Natural Disaster

The government said Wednesday that it estimates the damage to houses, roads, utilities and businesses could range from at least $198 billion to the $309 billion figure. Either total would easily top the cost of the previous worst disaster, the vast destruction Hurricane Katrina wreaked on New Orleans and the Gulf Coast region of the United States in 2005. The insurance industry estimates Katrina caused $125 billion worth of damage. The Japan damage total could go higher because the government's estimate did not include possible wider effects on the country's economy, such as reduced factory production caused by planned power outages, or the effect of nuclear radiation leaks on the nation's food and water supply. One financial analyst, Bank of Japan board member Ryuzo Miyao, said the stress on the world's third largest economy "could linger for some time" and that the short-term effects "are not insignificant."