* Japan will recover quickly from the disaster - UBS exec
* Cash-rich Japan companies likely to invest offshore - exec (Adds details, more comments)
By Denny Thomas and Elzio Barreto
HONG KONG, April 1 (Reuters) - Japan faces an extremely challenging environment in coming months, although the country will recover quickly from the crisis triggered by last month's disastrous earthquake, said UBS Asia-Pacific co-Chief Executive Alex Wilmot-Sitwell.
"The outlook for Japan in the short term is going to be extremely challenging," Wilmot-Sitwell told a forum at the bank's Hong Kong headquarters on Friday.
The Japanese government has estimated the cost of damages at up to $310 billion, making it the world's costliest disaster. Wilmot-Sitwell said the damages and the costs to rebuild Japan had been underestimated, without giving his own projection.
"The current slowdown that we will see in Japanese GDP and growth is probably underestimated because I think that the impact on the local economy will be very significant, the impact of power outages is going to be very significant," he added.
A powerful earthquake and tsunami that struck Japan last month has crippled the country, and the nation is also grappling with a nuclear crisis.
Over the long-run, the situation could trigger deep changes in the Japanese economy, Wilmot-Sitwell said.
"Japan has been somewhat in a deep sleep for the last 10 to 15 years and I have always predicted through the moment that Japan will wake up from that slumber and start to participate more significantly in the global economy," he added.
The expected slowdown in Japan would prompt a number of companies to look outside the country for growth, spurring a series of overseas investments, he said. The financial strain on smaller businesses could also spark a wave of domestic consolidation and create buying opportunities for international companies looking to expand in Japan.
"We will see a trigger point for inward and outward investments, for structural change in corporate Japan and I think it's a huge wake up call for politicians as well," Wilmot-Sitwell said. (Reporting by Denny Thomas and Elzio Barreto; Editing by Chris Lewis)