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Inadequate sanitation costs Bangladesh the equivalent of 6.3 percent of GDP in 2007

October 5, 2011

DHAKA, October 5, 2011 – Inadequate sanitation causes Bangladesh economic losses totaling US$ 4.22 billion (Taka 30,000 crore) each year. This is equivalent to 6.3 percent of the country’s GDP in 2007, according to a new report published by the Water and Sanitation Program (WSP), a multi-donor partnership administered by the World Bank.
The report, The Economic Impacts of Inadequate Sanitation in Bangladesh, is based on evidence on the adverse economic impacts of inadequate sanitation, which include costs associated with death and disease, accessing and treating water, and losses in education, productivity and time. The findings are based on 2007 figures, although a similar magnitude of losses is likely in later years.

The report shows that losses due to premature mortality and other health-related impacts of poor sanitation total about US$ 3.56 billion (Taka 25,000 crore) (84.3 percent of total economic impacts). This is followed by productive time lost to access sanitation facilities or sites for defecation at US$ 454 million (Taka 3,000 crore) (10.8 percent), and drinking water-related impacts at US$ 207 million (Taka 1,500 crore) (4.9 percent).

Ninety-five percent of the premature mortality-related economic losses are due to deaths and diseases among children under five. Diarrhea among these children accounts for US$ 1.46 billion (Taka 10,000 crore) (40.9 percent) of all health-related economic impacts.

In Bangladesh, diarrhea is the largest contributor to health-related economic impacts resulting from poor sanitation, amounting to two-thirds of the total health-related impacts. This is followed by acute lower respiratory infections, which account for about 15 percent of all health-related impacts.

Poor households are the biggest victims of inadequate sanitation. They experience about 71 percent of the total economic impact of inadequate sanitation.

Over the last decade Bangladesh has emerged as a global reference point in experimenting and implementing innovative approaches to rural sanitation. Community Led Total Sanitation, which started in Bangladesh, has now been replicated in other countries.  Bangladesh’s basic sanitation coverage rose from 33.2 percent in 2003 to 80.4 percent in 2009. This report shows that despite great success, much can still be done in the sanitation sector in Bangladesh” said Ellen Goldstein, Country Director for World Bank in Bangladesh.

The losses caused by poor sanitation exceed Bangladesh’s national development budget for 2007–2008 by 33 percent. The total amount of these losses is five times higher than the national health budget, and three times higher than the national education budget in 2007.

“Similar studies carried out in East Asia and India indicated annual per capita losses in the range of US$ 9.3 in Vietnam, US$ 16.8 in the Philippines, US$ 28.6 in Indonesia, US$ 32.4 in Cambodia and US$ 48.0 in India,” said Christopher Juan Costain, Regional Team Leader for WSP in South Asia. “Bangladesh lost US$ 29.6 per capita, which demonstrates the urgency of improving sanitation in the country.”

The report underlines that substantial investments are needed to improve sanitation. The Government of Bangladesh has made significant investments towards implementing its “Sanitation for all by 2013” programs. The rising trend in the Government’s budgetary allocation to sanitation indicates a strong commitment to the goals of the sanitation programs.

The report shows that sanitation and hygiene improvements will reduce premature deaths and related morbidity, eliminate domestic water-related costs, reduce absenteeism at schools and workplaces, and improve welfare and productivity.

As a result of comprehensive efforts to improve the level of sanitation, the report estimates a potential gain of about US$ 2.26 billion (Taka 16,000 crore).

The report follows a WSP study published in 2007 on the economic impacts of sanitation in Southeast Asia, a part of the Global Economics of Sanitation Initiative.


Media Contacts
In Washington
Christopher Walsh
Tel : +1 (202) 473-4594
In Dhaka
Mehrin Mahbub
Tel : + 880-2-8159001-28 ext. 4251