Japan's powerful earthquake and tsunami have sustained possible economic damage of $60-120 billion, but recovery efforts could bring about GDP growth by 0.2-0.3 percentage points in 2011, Citigroup analysts said on Monday.
Kiichi Murashima, an analyst with Citigroup, said the forecast was calculated for the fiscal year to begin in April.
In the fiscal year in question, Japan's economy could grow by 1.9.-2.1%, and could rise by 1.7% in January-December 2011, Murashima said. These figures include inevitable downturn in the first and early second quarter. Citi added that industrial production in Japan would fall by at least 1-2% in March.
Analysts in VTB Capital, a state-run investment bank, agreed that GDP growth in Japan would be negative - at least in the first and second quarters. But massive reconstruction projects would revitalize the economy.
The Japanese currency is likely to remain stable at a level of 82-84 yen to the dollar, Murashima said.
The effects of the quake and tsunami saw Japan's stock market to tumble by 6-10%.
VTB Capital experts have linked a drop in oil prices to the disaster. Japan is the world's third importer of "black gold." Citigroup analysts said work at six Japanese oil refineries, or one third of its refining capacity, had been suspended by March 14.
BRUSSELS, March 14 (RIA Novosti)
