Economic impacts of sanitation in Lao PDR

Economic impacts of sanitation in Lao PDR

Achieving the Millenuim Development Goal 7:  case study of Lao

Unimproved sanitation and hygiene have a wide array of impacts, which can be categorized into impacts on health, water, time use, and tourism. This study shows that a significant number of people living with unimproved household sanitation impose a large financial and economic loss on the Lao PDR economy; not only to private individuals but also to the public and commercial sectors. The study is based on information from national and provincial data and surveys, smaller scale research studies, and consultations with experts.

The paper notes that poor sanitation, including hygiene, causes at least 3 million disease episodes and 6 thousand premature deaths annually. The resulting economic impact is more than USD 115 million per year. Poor sanitation also contributes significantly to water pollution, adding to the cost of households accessing safe and clean water supplies. The associated economic costs of polluted water attributed to poor sanitation exceed USD 35 million per year. This excludes accessing clean water for non-drinking purposes, as well as loss of productive value for fisheries and agriculture due to polluted water. Poor sanitation also contributes to tourism losses.

The study demonstrates that poor sanitation affects everyone especially households without improved sanitation, which tend to be the poor and vulnerable. Hence, sanitation should receive greater attention from all levels of Lao government, and from development partners, the private sector and households. Decision makers should act now to stimulate demand for improved sanitation and hygiene practices, at the same time increasing the opportunities for households to access affordable sanitation services.

Recommendations noted by the authors include:

  • give greater priority to investments in sanitation and hygiene promotion
  • target investments to rural areas as well as to the urban poor
  • strengthen promotion and information campaigns to improve personal hygiene practices, focusing on hand washing with soap
  • provide better monitoring and further evaluation of the impact of improved sanitation options in Lao PDR
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