New Zealand Prime Minister John Key promised subsidies for workers as he started a two-day visit to Christchurch, which was hit by a magnitude-7 earthquake that cut power, damaged hundreds of buildings and closed the central business district.

The government has pledged NZ$350 ($252) a week for workers at companies with 20 or fewer staff, Key said. The plan will keep employees in work, Key said after arriving in Christchurch today, according to a statement on his website.

New Zealand faces a NZ$2 billion damage bill and Christchurch, a city of 348,000 on South Island, is under a state of emergency after the quake struck on Sept. 4. Key plans to meet today with local mayors in the Canterbury region and visit welfare centers after canceling plans to fly to Europe on Sept. 10, spokesman Kevin Taylor said.

"I can well appreciate the magnitude of loss that people have suffered," Key said. "I was awestruck by the power of the earthquake and the damage that it has caused in the city I grew up in."

The water supply and damage to as many as 100,000 homes are among the biggest problems to be addressed, Key said in a speech yesterday after a Cabinet meeting. The quake buckled roads, ruptured sewer lines and water pipes and ripped facades off buildings.

The state of emergency will remain until at least tomorrow, when schools in the city and two surrounding districts may be allowed to open, the Ministry of Civil Defence & Emergency Management said on its website.

Eoin Treacy's view Thankfully, there was no loss of life from the Christchurch earthquake which has caused such damage to the city and its environs. The estimated NZ$2Billion cost of reconstruction coupled with potential overruns will approximate a stimulus package for the local and potentially national economy.

With a dividend yield over 5% and a firm currency the New Zealand market was in need of a catalyst to spur investor demand. The Index has been ranging mostly above 3000 since July last year and is currently rallying from the lower side. A sustained move below the July lows near 2925 would be required to question scope for a retest of the April highs and potentially more.