NEWS | Wednesday, 21 May 2008

Earthquake costs Chinese companies $9.5 billion

The recent earthquake has cost Chinese companies $9.5bn, the country’s government has said.
Deputy industry minister Xi Guohua said about 14,207 firms in Sichuan province and nearby area were damaged by the earthquake and 1,387 employees killed.
More than 71,000 people are dead, buried or missing after the quake in Sichuan province, state media says, with more than 220,000 people injured.
On Monday, China began three days of mourning for the earthquake victims.
Last week AIR Worldwide, a disaster modelling firm, estimated that the cost of the quake was likely to exceed $20bn.
The Chinese government has allocated some $150m towards the relief budget.
Demand for raw materials in China is expected to rise significantly, as the disaster-hit area tries to rebuild.
“Construction demand in the Sichuan region will be very robust,” said Helen Wang, an analyst at DBS.
Chinese cement firm Anhui Conch plans to invest 5bn yuan to start three new plants in Sichuan. The firm has seen its shares rise 17% in the past week.
Other firms in the sector have also risen, with shares in both Huaxin Cement and Fujian Cement up 10% on Monday.
Meanwhile Japanese carmaker Toyota, which has a joint venture in China with local auto firm FAW, has restarted operations.
Production at the plant had been stopped for a week following the earthquake.