Potential Economic Effects - Fishing

During 1999-2000, more than 20,000 people will be employed in various sectors of the fishing and seafood processing industries. The revenue and taxes generated by this industry are projected to be worth US$1.2 billion or 4.3% of the State of Alaska's GSP. If a tsunami of the magnitude of the 1964 event were to occur in the current year, it would have significant effects both for local community economies and for the State and probably certain global markets.

In 1999-2000, the town of Kodiak is predicted to have a population of nearly 14,000 people. The fishing industry is the largest sector of the town's economy and in 1999-2000 is forecast to be worth more than $85 million. Nearly 40% of Kodiak's payroll will relate to the fishing and seafood industries. The 1964 tsunami caused damage and loss to 80% of Kodiak's fishing fleet stock, seafood processing units, seafood storage and cannery facilities. Consequently, the impacts of a 1964 magnitude tsunami today would be enormous.

One element of the fishing industry that might be especially hard hit by a large tsunami would be the crab fishing community. The 1964 tsunami caused enormous damage or total destruction to many crab breeding grounds in the Prince William Sound. In many locations, crab beds took 12 years to re-establish themselves to levels where harvesting could be sustained on a year to year basis. Consequently, fishermen in these locations were faced with serious interruption to business activities and as such, a similar event in 1999-2000 could have significant implications for the insurance industry with claims for business interruption and loss.

On a more regional basis, a 1964 magnitude tsunami could have very significant economic impacts for the State of Alaska. For example, in the fiscal year 1999-2000, the commercial Pacific salmon catch is forecast to be worth just over US$500 million. The canned salmon derived from this catch will supply 65% of the global volume of retail salmon consumed. The 1964 tsunami caused the destruction of 73% of fishing vessels, fish processing plants and warehouse facilities, and in some cases took several years to be restored. Therefore, it is highly probable that there would be a significant interruption to the supply of Alaskan Pacific salmon. Since the Alaskan industry supplies 65% of the global volume, there would also be a significant rise in the price of salmon globally.

Consequences:

• Oil
  
• Tourism
  
• Insurance