Quake response to aid investor confidence in China

By Jason Subler - Analysis

BEIJING (Reuters) - Foreign investors will probably come away from the devastating earthquake that hit China this week more reassured than shaken, thanks to the government's quick and open response.

The 7.9 magnitude quake that struck south-western Sichuan province on Monday, with its epicentre in a relatively remote, mountainous area, has had a bigger impact on human life than on the economy.

In comparison to past disasters, including the 2003 SARS virus crisis that was initially covered up and snowstorms earlier this year that Beijing was slow to respond to, the government has swiftly mobilised resources, sending tens of thousands of troops to help the relief effort.

It has also allowed a freer flow of information, with state media giving frequent updates on the number of people killed and missing. Foreign reporters have been allowed into the stricken areas, in sharp contrast to what happened during the unrest in Tibet and neighbouring provinces in mid-March.

That, more than worries about the potential impact of natural disasters on their business, is likely to remain in investors' minds, said Edward Radcliffe, a partner with corporate advisory firm Vermillion.

"These things could happen almost anywhere," Radcliffe said.

"(Investors) should probably come away from the events of the last few days with, the tragedy aside, relatively positive feelings about how the government's responded to the earthquake and how it's marshalled its resources."

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