Australian bushfire near Bairnsdale
FILE PHOTO: A bushfire near Bairnsdale in Victoria's East Gippsland region
Australia is expected to face up to AU$5 billion (US$3.5 billion) in losses as fires continue to rage across the continent, according to an Australian Westpac bank forecast.

The natural disaster could also cut 0.2 to 0.5 percent of the country's GDP, the bank said in its preliminary analysis released on Monday. The tourism and agricultural sectors have been hit hardest, while the most severely affected area accounts for around one percent of the nation's economy.

Around 10,550 insurance claims totaling AU$939 million have been lodged since the bushfire catastrophe was declared on November 8. While the total cost of disasters such as this (including both insured and uninsured losses requiring government assistance) is about double the insured loss, the full economic impact is "highly uncertain," according to the bank.

"Assessing the economic impact of disasters is always very difficult, particularly when the full extent of damage is still unknown," Westpac analysts said.

The current bushfire crisis has had a greater impact than the 2009 'Black Saturday' fires in Victoria, one of the most devastating in Australian history, in which more than 170 people died, 2,029 homes were destroyed, and over 400,000 hectares were burned. Only the Queensland floods of 2010-11 had a larger impact, with an estimated total cost of AU$6.4 billion, Westpac said.

On Monday, S&P Global Ratings said that the bushfire crisis will not jeopardize the country's AAA rating. The agency believes that the local governments will be able "to absorb the fiscal costs, which are relatively small compared with their budgets."