Sichuan Quake Causes 10 billion Dollar Loss

The disaster comes at a difficult time for Chinese banks when Beijing introduced tighter monetary policy to control inflation.

BEIJING (AsiaNews/Agencies) - A preliminary study by China's Industry Ministry indicates that 14,207 industrial enterprises suffered 67 billion yuan in direct economic losses (about US$ 10 billion), Vice Minister of Industry and Information Technology Xi Guohua said at a press conference yesterday.

Among the worst hit there is the Sichuan-based Dongfang Electric Corp, a power equipment maker, which suffered 7 billion yuan in losses of fixed assets.

One of its subsidiaries, Dongfang Steam Turbine, in Hanwang (Mianzhu county), was seriously damaged by the quake and 365 of its workers and their family members were killed.

The Agricultural Bank, whose 31,000 outlets are mostly in the rural areas, lost 8.5 billion yuan, whilst losses at Bank of China amounted to about 160 million yuan as of Sunday.

The China National Petroleum Corp (CNPC), the nation's biggest oil producer, said losses caused by the quake reached 1.78 billion yuan as of Sunday.

Its operations in Sichuan, Chongqing, Shaanxi and Gansu have been affected, including oil and gas fields, 71 oil or gas pipes, 908 petrol stations, and 47 oil tanks.

Five workers have been killed, 44 injured and five are missing after the earthquake, according to a company statement.

Some banks on the mainland and in Hong Kong have pledged loans for reconstruction. Domestic banks have offered about 3 billion yuan.

Hang Seng Bank, the largest lender in Hong Kong, set aside an additional 1 billion yuan loan for earthquake relief.

Most lenders have given borrowers in affected areas a grace period to delay repayments

The disaster comes at a difficult time for Chinese banks when Beijing introduced tighter monetary policy to control inflation.

For some analysts the government will have to review its macroeconomic policy to take into account the earthquake emergency.