Recent China Quake Will Hurt Economy?

From my little bit of research (Wikipedia mainly), the following facts jump out at me:
The area is only 5% of China, but is one of the largest production agricultural regions. It also has the most mineral resources, something that China has been starved of in it's recent economic boom. +80% of the work force is utilised. On the other hand, there is a large degree of poverty in the region and a very large, transitory population.
So we have a lot of damaged infrastructure and a LOT of people without housing at the moment, with little in the way of individual financial capital for rebuilding.
Firstly they need to ensure that a significant population of people are fed and watered - thankfully the large agriculture production of the region is one of the things going for them - though there will be food shortages until basic infrastructure is rebuilt. Thankfully they will also have a large workforce to mobilise - as long as they can get materials and transport.
Then they need to rebuild housing and/or migrate people out of the area - before winter. The migration of workers to unaffected areas may become a problem in the third step below.
Then they need to rebuild/repair damaged economic infrastructure.
Somewhere about step 2 and step 3, especially if winter hits, medium-term medical problems are going to arise - poor sanitation, exposure, stress, nutritional problems - in short, expect a lot of moderate to severe disease among the susceptible. All they need now is a resurgence of SARS or bird flu.

In short, one of the most productive areas of China has just become a drain on transport, materials, medication and funding. Food may or may not be a problem, based on how quickly agricultural and basic transport can be reestablished. Some people will move out of the area, which will relieve pressure on the rebuilding effort, but slow down eventual economic recovery.

I think we'll see over the next year or so, an amazing amount of cooperation in the affected communities - but it won't be easy for them, and China's economy is going to slow down as a result - but not drop.

Although there is no hard evidence at this point, but I agree with this article that the China earthquake is receiving more attention of charity money compared to the Myanmar's disaster.
http://money.cnn.com/2008/05/20/news/...

This probably has a lot to do with the lack of discipline among Myanmar's local government. People are afraid their donation won't go to the intended victims. I suppose the Chinese government are doing better in that sense. I hope both countries will recover from this soon.

And yes, any such huge natural disaster WILL affect the local economy for years to come. The best a government can do is to rebuild the basic infrastructure, and push out policies to attract new investments.

Just the fact that the rescue effort, the rebuilding funds, etc., will hurt the economy - we are talking about billions of dollars lost here. So how can the economy not be affected?

It will energize the economy even though some may hurt, where it hurts was not an enconomic center. Plenty of rebuilding and restructuring will go on and the earthquke will also stall the zealous Tibetan's from further violenlence, in other words, the monks should busythemelf by helping others, not killing others.

good question. the recent disasters in China: quake + winter storms had slowed down the economy. resources are pulled to rescue, as well as to the over-invested Olympics. imo, it may not be bad for the hot economy with a high inflation. the quake alone should just affect the local communities. hope the Chinese gov will do best to restore them.

Sichuan's economy, like other provinces in China's western region, lags behind China's wealthier coastal regions. The province's industrial output only accounts for 3.9% of China's gross domestic product, according to Merrill Lynch (MER). Sichuan has a population of more than 87 million, roughly the same as Vietnam, and many Sichuanese either stay at home to farm or go to China's manufacturing bases in the southern and eastern regions to work.

However the China Petro had cut the gas field production and thus will increase the inflation in food and energy supplies. The quake will further raise the inflation in the entire E. Asia region.

Yes, it will hurt the local economy, but the impact probably won't spread to the whole nation, not to mention Asia.