Sat, May 21, 2011 - Page 10 News List

TEPCO head apologizes, steps down

ECONOMIC AFTERSHOCK:Japan’s economy contracted at an annualized rate of 3.7% in the first quarter and exports fell in March for the first time in 16 months


Tokyo Electric Power Co president Masataka Shimizu, the utility behind the world’s worst nuclear disaster since Chernobyl, apologized at his company’s Tokyo headquarters yesterday and said he was standing down to take responsibility for the nuclear crisis.

“I wanted to take managerial responsibility and bring a symbolic close,” he told reporters, bowing several times during the news conference. “We are doing our utmost to settle the crisis.”

Three reactors at the company’s Fukushima Dai-ichi power plant went into meltdown after a March 11 earthquake triggered a tsunami that destroyed the plant’s cooling systems. Efforts to stop leaking -radiation and get the reactors under control have been a perilous struggle and are expected to continue into next year.

The move was widely expected as heads of major Japanese companies are expected to step down to take responsibility for even lesser scandals and problems.

TEPCO reported that its losses for the fiscal year ending in March totaled ¥1.25 trillion (US$15 billion). TEPCO recorded a profit of nearly ¥134 billion the previous fiscal year.

Overall losses from the disaster are expected to be far bigger, including compensation for the thousands of people forced to evacuate from their homes around the plant and businesses such as farms that say produce was damaged by radiation.

TEPCO must also shoulder the cost of resolving the problems at the reactors, as well as restarting other non-nuclear power plants, to make up for the electricity shortfall.

The government has been studying possible bailouts, including using contributions from other utilities and taxpayer money to help TEPCO deal with the towering costs.

TEPCO has been criticized for being unprepared for the tsunami despite certain scientific evidence that earthquake-prone Japan could be hit with a wave of that size. It has also been criticized for being slow and lacking transparency in disclosing information about the plant’s problems.

Separately, Japan’s central bank kept its key interest rate unchanged at virtually zero yesterday to shore up the nation’s quake-battered economy.

The Bank of Japan’s nine-member policy board voted unanimously at a meeting to keep the overnight call rate target at zero to 0.1 percent. The decision was widely expected.

The move came a day after Japan’s government said the world’s No. 3 economy shrank in the first quarter of this year, veering back into recession as factory production and consumer spending wilted in the aftermath of March 11.

Japan’s economy contracted at an annualized rate of 3.7 percent in the quarter. Exports also went south in March for the first time in 16 months. Companies are -reporting lower earnings and a diminished outlook for the rest of the fiscal year.

The central bank warned yesterday that Japan’s economy would face “strong downward pressure” for the time being as a result of tumbling production and falling exports in the wake of the March twin disasters.

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