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Chile wants loans, focuses on aid for quake areas
March 4, 2010 / 6:30 AM / 8 years ago

Chile wants loans, focuses on aid for quake areas

* Outgoing leader says Chile needs international credit

* President-elect unveils four-phase plan to rebuild

* 279 dead have been identified, total death toll unclear

* Relatives use Facebook, Twitter to search for missing (Updates with confusion over death toll, new earthquake)

By Terry Wade and Mario Naranjo

CONCEPCION, Chile, March 4 (Reuters) - Chile will need international loans and three to four years to rebuild after one of the most powerful earthquakes in a century killed hundreds of people and demolished cities and towns, President Michelle Bachelet said on Thursday.

Saturday's 8.8-magnitude quake destroyed or seriously damaged hundreds of thousands of homes, wrecked bridges and highways and cracked open modern buildings in the capital's suburbs. It also shattered vats at Chile's famous vineyards and briefly shut down some of the world's richest copper mines.

"We will undoubtedly need to turn to international lenders," Bachelet said on Thursday. "We are going to have to ask (for credit) and hope that via the World Bank or other mechanisms we can count on sufficient funds."

The death toll from the disaster was thrown into doubt on Thursday when the government said it had identified 279 victims and backed off an earlier estimate of 802 deaths.

The previous estimate included some missing people who have since been located, a government source said, adding that an unspecified number of bodies had yet to be identified.

Some witnesses have said hundreds of people were missing in the tsunami-devastated coastal town of Constitucion, where bodies continued to wash ashore on Thursday. And Bachelet herself has said the death toll is likely to keep rising as rescue crews pull more bodies from the rubble.

Bachelet's government initially said it would be able to cope with reconstruction costs out of its budget. But it misjudged the scale of the damage, which according to one estimate could reach $30 billion, or about 15 percent of the South American country's gross domestic product. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Take a Look on Chile earthquake [ID:nCHILE] Breakingviews column [ID:nN01102406] Graphic link.reuters.com/ram33j Reuters Insider on economy link.reuters.com/duk92j ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

ECONOMY SHOULD REBOUND

The economy of the world's top copper producer has a good chance of rebounding from quake damage in the second half of the year, analysts say. Ratings agency Standard and Poor's added to that optimism, saying the quake would have no immediate effect on Chile's credit quality. [ID:nN04176714]

The quake and the tsunamis it triggered demolished coastal towns and villages and caused serious damage across a vast area of south-central Chile, including the country's second-largest city, Concepcion.

A 6.3-magnitude quake shook the northern city of Calama in the country's mining heartland on Thursday, one of dozens of tremors in the past week. Officials said no damage to homes and mines in the area had been reported.

President-elect Sebastian Pinera, a billionaire businessman who will take office on March 11, unveiled a four-phase plan on Thursday to rebuild the country and acknowledged the quake will alter the course of his government.

"The future government will not be the government of the earthquake, it will be the government of reconstruction," said the silver-haired conservative.

United Nations Secretary General Ban Ki-Moon will visit Chile on Friday to assess the damage with Bachelet and Pinera.

Bachelet, whose popularity is being tested by the government's initially slow response to the disaster, on Thursday visited Concepcion, where electricity was just starting to be restored six days after the quake.

Terrified by dozens of powerful aftershocks, survivors in some of the worst-hit towns are living in makeshift shelters and abandoned cars on hillsides as rescue workers search the rubble for survivors and troops patrol to quell looting.

Search teams with dogs scoured a small, tsunami-battered island near Constitucion where hundreds had been camping out for a summer festival when the quake struck.

"Everyone died there, whole families of 10 to 12 people who were camping," said 30-year-old fisherman Mario Leal, who was unable to save his wife and two young children.

"I lost everything. All my family and my house."

LOOTING FLARES AGAIN

In Talcahuano, a port city abutting Concepcion, dozens of giant fishing boats and smashed cars lined the town's muddy streets. The receding tide left a mangled waterfront and dark stains up to six feet (1.8 meters) on the sides of buildings.

"I'm living a second life," said Jorge Briones, a 67-year-old mechanic who survived the tsunami there.

Widespread looting broke out in the days following the quake but the country's defense minister told reporters the thousands of troops sent to stricken areas had succeeded in ending the "pillaging and vandalism."

Thefts have died down as aid with basic staples arrived in disaster areas, but looters raided stores again in Talcahuano on Thursday after a curfew ended.

Soldiers strapped one looter to a stop sign with plastic handcuffs, but several got away before order was restored.

Friends and relatives at home and abroad used Facebook, Twitter and Google to post messages and pictures of the missing as well as of young children found alive without families. Radio stations broadcast names of those yet to be traced.

Officials in some areas said they had called off the search for survivors and were focusing on distributing aid. Very few survivors emerged from the water after enormous waves sucked them out to sea on Saturday.

"Our priority will be to tend to the living," said Jaime Toha, the most senior government official in the Bio Bio region, the worst-hit by the quake.

Chile's top oil refinery was damaged and could be closed for a month, boosting the need to import fuel. [ID:nN03120690]

Another major refinery could be up and running by next week. But Chile, which produces almost no fossil fuels, was already stepping up imports from Asia and the United States.

State mining company Codelco said the quake compromised less than 0.5 percent of its annual output. [ID:nN04136817]

In a sign that investors are now betting on a smooth recovery, Chile's main stock index .IPSA rose on Thursday for the first time since the quake and the peso CLP=CLCLP= closed at a five-week high. [ID:nN04125551] (Additional reporting by Ignacio Badal in Constitucion, Fabian Cambero, Mica Rosenberg, Juana Casas, Rodrigo Martinez, Antonio de la Jara and Simon Gardner in Santiago; Writing by Todd Benson; editing by Todd Eastham)




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