Hurricane Katrina has been an appalling natural catastrophy, with a significant loss of life and for the survivors devastating suffering and dislocation.
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If the human impact has been all too evident in the misery unfolding on our British news broadcasts, the economic implications have been less clear cut and at times confusing.
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Most of the economic fall out that has impacted upon the UK has been the rise in the oil prices, which stems from the loss of production of crude oil and refined products.
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The long term effect on the 'western' economies should not be negative in the medium or long term. Much of the negative short term impact is likely to be self-cancelling in the medium term. The estimated drag on the US economy recently estimated to be about $35 bn caused by high oil prices should be more than offset by the reconstruction programme estimated to be worth as much as $50 bn.
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Lloyd's of London today estimated a loss of £1.4 bn from Katrina - a loss that the insurance market can well absorb.
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The political response to the effects of the hurricane will probably be more extensive than the economic impact. In the UK the Atlanticists and the Europhiles are now well identified.
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