UPDATE 1-Chile upgrades tsunami alert for coast, Easter Island

Fri Mar 11, 2011 5:24pm EST

* Chile evacuating residents in flood prone areas

* Waves 3 meters (10 ft) high expected to hit Easter Island

* Chile still recovering from massive quake a year ago (Updates with interior minister quotes, details)

SANTIAGO, March 11 (Reuters) - Chile on Friday upgraded a tsunami alert for its coastline and remote Easter Island territory after waves triggered by a massive earthquake in Japan hit Hawaii, and said it would evacuate flood-prone areas along the mainland coast.

Chile was hit by a magnitude 8.8 quake and ensuing tsunamis a year ago that hammered towns, roads and industries in south central Chile, killed more than 500 people and caused an estimated $30 billion hit to the economy between damaged infrastructure, property and lost productivity.

"The level of tsunami has been raised for Easter Island, where waves are now estimated at 3 meters (10 feet) rather than 2 meters (7 feet)," said Interior Minister Rodrigo Hinzpeter, adding the alert also applied to Chilean Antarctica.

"We are also going to evacuate residents in flood-prone zones (along the coast of the mainland)," he added, saying the evacuation should be complete by 9:30 p.m. (0030 GMT on Saturday). The waves are expected to reach mainland Chile around midnight (0300 GMT on Saturday).

Thousands of people fled their homes along the California coast on Friday as the tsunami began hitting the U.S. West Coast after rolling through Hawaii.

But the giant wall of water appeared to have lost much of its energy as it roared thousands of miles (km) across the Pacific Ocean toward North America, according to initial reports from officials in the United States, Mexico and Canada.

Chile's own massive quake in February 2010 only very briefly slammed the brakes on an economic recovery from the global financial crisis, and reconstruction is helping fuel a strong recovery driven by high prices for main export copper.

The linchpin mining sector in the world's No. 1 copper producer was basically unscathed, and the economy is seen growing around 6 percent this year.

The state says it has completed 50 percent of its end of post-quake reconstruction, with the balance set to drive continued strong growth this year. But tens of thousands of homes and several large hospitals are still pending. (Reporting by Simon Gardner, Brad Haynes, Antonio de la Jara, Moises Avila; Editing by Eric Beech)