Fifth Anniversary of the Tōhoku Earthquake
This day, March 11, marks the fifth anniversary of the Tōhoku earthquake, the worst post world war II disaster to strike Japan. The Tōhoku earthquake was one of the most severe earthquakes on record, with a magnitude of 9.0. The effects were breath-taking:
- Tsunami waves reaching heights of 40.5 metres was triggered.
- The main island of Japan, Honshu, was shifted 2.4 metres east.
- The earth’s axis was shifted, estimated between 10 and 25 centimetres.
- The length of the day was shortened by about a microsecond.
The most devastating effects in terms of human and economic losses were caused by the tsunami waves. The official death toll was, by April 10, 2015, 15,891 people, with more than 2.500 people still reported missing. About 90% of the fatalities died by drowning.
The tsunami also accounted for most of the damage to buildings, property and infrastructure. 45,700 buildings were destroyed and 144,300 buildings were damaged. About 230,000 cars and trucks were damaged or destroyed. The World Bank estimated in 2011 that the damages could amount to $235 billion, making it comparable to the expected costs of a major Californian earthquake.
Five years after the disaster, reconstruction is ongoing and the Japanese government expects most reconstruction to be finished in time for the 2020 summer Olympics in Japan.
The Fukushima Nuclear Disaster
In the long term, the subsequent Fukushima nuclear disaster, is likely to be the sustaining memory, with effects lasting for generations. Though the plant was closed down following the earthquake, the tsunami caused the failure of switching stations and emergency generators, effectively shutting down the reactor cooling. As a result, three reactors suffered core meltdowns and explosions blowing off the tops of reactors, causing large emissions of radioactive material to the air and water. The radioactive leakage to the ground water and the Pacific is ongoing.
More than 160 000 people were evacuated in the Fukushima prefecture, with almost 100 000 people still unable to return. The decommissioning of the plant could take 30 to 40 years, and many areas will remain off-limits for a very long time.
The Muteki Cat Bond
The Tōhoku earthquake triggered one cat bond, Muteki Ltd. Had the epicentre of the earthquake been closer to Tokyo, additional cat bonds would likely have triggered. Nevertheless, the event demonstrated the expedited nature of cat bonds compared to many other mitigating efforts. The event notice by the sponsor Zenkyoren, the National Mutual Insurance Federation of Agricultural Cooperatives of Japan, on April 4. 37 days later, May 7, the bond was declared to have triggered by the calculating agent, AIR Worldwide. Thus, funds were released enabling Zenkyoren to reimburse its members (farmers) for costs incurred by the disaster.
The event naturally affected the cat bond market as such, causing the most widely used index, the Swiss Re Cat Bond Total Return Index, to drop almost 4% in one month, which is one of the largest monthly drawdowns observed in the cat bond market. However, five months later, in mid-September, the market value had recovered, showing the resilience of the cat bond market as such.
Google has a touching “Memories for the Future” map showing before and after images as well as the recovery of the region.
Wikipedia covers the Tōhoku earthquake in great detail.