Published by Gbaf News
Posted on August 26, 2011
7 min readLast updated: January 22, 2026
Today the Water and Sanitation Program, a multi-donor partnership administered by the World Bank released a series of reports pointing out that households that invest in basic sanitation have a better quality of life and could increase up to seven fold the return on investment in economic benefits.
The reports, which are the second phase of the Economics of Sanitation Initiative (ESI) launched initially in East Asia in 2007, found that all types of sanitation improvement evaluated have benefits that exceed costs. The new reports analyze benefits and costs of sanitation interventions in Indonesia, Cambodia, China (Yunnan Province), Philippines, and Vietnam.
They recommend that countries:
Decisions should take into account not only the measurable economic costs and benefits, but also other key factors, including intangible impacts and socio-cultural issues that influence demand and behavior change, availability of suppliers and private financing, and actual household willingness and ability to pay for services,
lead author Guy Hutton, economist and WSP consultant said.
The high net benefits from low-cost sanitation options, such as pit latrines, suggest these technologies should be centerpiece to increasing access for rural households, the reports said. For example, among the various sanitation options in Indonesia’s rural areas, the most favorable economic performance was for wet pit latrines. The annual economic rate of return was more than 100 percent, requiring less than one year to recover the economic value of the initial investment costs.
To improve quality of life in East Asia’s increasingly populated cities, where pit latrines have limited feasibility, decision-makers need to take into account the economic benefits from improved waste removal and treatment options, the reports said.
The first phase of ESI demonstrated for the first time the huge economic toll of poor sanitation, up to seven percent of GDP in some countries,” said WSP Senior Regional Team Leader for East Asia, Almud Weitz. “The findings from phase two give countries, more specifically sanitation decision-makers, improved evidence on the costs and benefits of alternative sanitation options in different contexts.
Despite significant growth among some countries in East Asia, access to, and the quality of sanitation facilities are closer to that of comparable low-income countries. For example, 60 million people in Indonesia still defecate in the open.
For a copy of the reports, visit: http://www.wsp.org/wsp/content/economic-impacts-sanitation
The Water and Sanitation Program (WSP) is a multi-donor partnership created in 1978 and administered by the World Bank to support poor people in obtaining affordable, safe, and sustainable access to water and sanitation services. WSP’s donors include Australia, Austria, Canada, Denmark, Finland, France, the Bill & Melinda Gates Foundation, Ireland, Luxembourg, Netherlands, Norway, Sweden, Switzerland, United Kingdom, United States, and the World Bank.
The World Bank Group is the largest external financier (US$7.5 billion in fiscal year 2011) in water supply and sanitation, irrigation and drainage, water resources management, and other water-related sectors, and provides strong advisory and analytical support to client countries.
Contacts:
In Washington: Christopher Walsh, +1 (202) 473-4594, cwalsh@worldbank.org
In Stockholm: Sara Sultan, +1 (703) 474-2355, ssultan1@worldbank.org
In Jakarta: Yosa Yuliarsa, + 62-21-5299-3179 yyuliarsa@worldbank.org
For Broadcast Requests: Natalia Cieslik, +1 (202) 458-9369, ncieslik@worldbank.org
Today the Water and Sanitation Program, a multi-donor partnership administered by the World Bank released a series of reports pointing out that households that invest in basic sanitation have a better quality of life and could increase up to seven fold the return on investment in economic benefits.
The reports, which are the second phase of the Economics of Sanitation Initiative (ESI) launched initially in East Asia in 2007, found that all types of sanitation improvement evaluated have benefits that exceed costs. The new reports analyze benefits and costs of sanitation interventions in Indonesia, Cambodia, China (Yunnan Province), Philippines, and Vietnam.
They recommend that countries:
Decisions should take into account not only the measurable economic costs and benefits, but also other key factors, including intangible impacts and socio-cultural issues that influence demand and behavior change, availability of suppliers and private financing, and actual household willingness and ability to pay for services,
lead author Guy Hutton, economist and WSP consultant said.
The high net benefits from low-cost sanitation options, such as pit latrines, suggest these technologies should be centerpiece to increasing access for rural households, the reports said. For example, among the various sanitation options in Indonesia’s rural areas, the most favorable economic performance was for wet pit latrines. The annual economic rate of return was more than 100 percent, requiring less than one year to recover the economic value of the initial investment costs.
To improve quality of life in East Asia’s increasingly populated cities, where pit latrines have limited feasibility, decision-makers need to take into account the economic benefits from improved waste removal and treatment options, the reports said.
The first phase of ESI demonstrated for the first time the huge economic toll of poor sanitation, up to seven percent of GDP in some countries,” said WSP Senior Regional Team Leader for East Asia, Almud Weitz. “The findings from phase two give countries, more specifically sanitation decision-makers, improved evidence on the costs and benefits of alternative sanitation options in different contexts.
Despite significant growth among some countries in East Asia, access to, and the quality of sanitation facilities are closer to that of comparable low-income countries. For example, 60 million people in Indonesia still defecate in the open.
For a copy of the reports, visit: http://www.wsp.org/wsp/content/economic-impacts-sanitation
The Water and Sanitation Program (WSP) is a multi-donor partnership created in 1978 and administered by the World Bank to support poor people in obtaining affordable, safe, and sustainable access to water and sanitation services. WSP’s donors include Australia, Austria, Canada, Denmark, Finland, France, the Bill & Melinda Gates Foundation, Ireland, Luxembourg, Netherlands, Norway, Sweden, Switzerland, United Kingdom, United States, and the World Bank.
The World Bank Group is the largest external financier (US$7.5 billion in fiscal year 2011) in water supply and sanitation, irrigation and drainage, water resources management, and other water-related sectors, and provides strong advisory and analytical support to client countries.
Contacts:
In Washington: Christopher Walsh, +1 (202) 473-4594, cwalsh@worldbank.org
In Stockholm: Sara Sultan, +1 (703) 474-2355, ssultan1@worldbank.org
In Jakarta: Yosa Yuliarsa, + 62-21-5299-3179 yyuliarsa@worldbank.org
For Broadcast Requests: Natalia Cieslik, +1 (202) 458-9369, ncieslik@worldbank.org
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