Japan Nuclear Crisis: Impact On Economy

Posted on April 16, 2011 in GlobeScope

By Amrita Paul:

Japan had barely begun to recover from the massive earthquake on its east coast when it was struck by a radiation explosion in the town of Fukushima on the 11th of March. This mishap is counted as one of the worst nuclear explosions because it has not only affected people’s lives but also slowed down the economy of the country to a great extent. Industries all over the world (especially food industry) have suffered a major blow because of reduced industrial output from Japan, a major exporter.

People are now concerned regarding nuclear contamination because of which buyers are forced to turn away from Japanese agricultural goods. Supply Chain Distributers are encouraging the buyers to get certain niche products in large quantities “just in case” to avoid danger. This can lead to rise in the prices of such exclusive goods. Such a fear is likely to affect Japan’s economy in a major way. The worst part is that the full implication of the nuclear disaster is still unknown because of which people are unwilling to take any chances.

According to a Bloomberg news report, Asian countries are already avoiding Japanese grown food. The common perception is that agricultural produce is grown outdoors because of which they can’t be easily cleaned if and when they come in contact with radiation. In the meantime, reports have confirmed of abnormal radiation levels in spinach, sweet potatoes, milk and water. Taiwan has also detected the presence of radiation on the packaging of a noodles brand.

However, these reports are in stark contradiction of Government assurances stating that radiation limits have been safely maintained below legal limits. According to economist, Authur Alexander — “There’s a lot of nervousness around. When the consumers see radiation in the air, they react in a highly emotional way.” It is now useless to justify or contradict such widespread fear because such an overwhelming nervousness has already convinced the world powers to shut out Japanese goods. Something as popular as Sushi is off the menu in most Asian countries and even in Tokyo restaurants. WHO spokesman, Peter Cordingley said: ‘It’s a lot more serious than anybody thought in the early days when we thought that this kind of problem can be limited to 20 to 30 kilometres (12 to 18 miles).”

Thailand has announced to have destroyed a shipment of sweet potatoes which were found to contain radioactive iodide. Neighbouring countries like Korea and China have also banned the use of Japanese food products. The European Union is now imposing strict tests on Japanese food products. Today, household products like tap water, leafy vegetables, eggs, meat and milk in a 50-mile radius of the damaged Fukushima nuclear plant have been placed on its ‘danger list’. Even the United States will refrain from importing milk, fruits and vegetables from Japan till the situation becomes relatively under control. In view of the present situation, a Geneva-based agency rightly said that “Radiation in food can accumulate in the body and it poses a greater risk to health than radioactive particles in the air, which disperse within days.

The real risk, as economist Jay Bryson points out, is not the food. Instead, it is the chance that the radiation which was now confined to food can spread to other substances as well. Because of the nuclear meltdown, the radiation has spread over hundreds of miles due of which factories can’t produce the way they did before the accident. “You can rebuild a factory” says Bryson, “but that takes years.”

In spite of the hue and cry, the rest of the world still remains vaguely aware of Japan’s plight. The only worry of most countries is that certain manufacturers have been forced to halt productions because of shortages of essential components which are made only in Japan. It’s high time to realize that eight thousand people have died in this accident already. It will take a minimum of five years and around £145billion to rebuild the entire nation. As far as Japanese food export is concerned, only time will tell how long it will take to eliminate the dread off people’s mind.

Additional Reading: What Did We Learn From Japan? [Disaster Management In India]

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