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Costs of environmental
degradation
An analysis in the Middle East and North
Africa region
Muawya Ahmed Hussein
Dhofar University, Salalah, Dhofar, Oman
Costs of
environmental
degradation
305
Received 20 July 2007
Revised 25 October 2007
Accepted 30 November 2007
Abstract
Purpose – The purpose of this paper is to provide estimates of damage cost for several areas of the
environment. In particular: to estimate the cost of degradation as a percentage of gross domestic
product (GDP) at the national level; to enhance local capacity in environmental economics, in particular
in the valuation of environmental degradation; and to provide an input to inter-sectoral environmental
priority setting.
Design/methodology/approach – To achieve the above objectives a framework was developed to
estimate the cost of environmental degradation in seven countries in the region, for six categories.
Estimates reflect order of magnitude and therefore represent an indication of actual damage costs. A
range of estimates was provided to reflect the uncertainty of the results. Damage costs are presented in
annual values (in local currencies, in US$ dollars) and as a per cent of GDP. Expressing costs as a share
of GDP provides a sense of magnitude and will allow cross-country comparison.
Findings – The damage cost of environmental degradation in Middle East and North Africa (MENA)
in 2000 is estimated at US$ 9 billion per year, or 2.1-7.4 per cent of GDP, with a mean estimate of 5.7 per
cent of GDP. In addition, the damage cost to the global environment is estimated at 0.5-1.6 of GDP,
with a mean estimate of 0.9 per cent of GDP.
Research limitations/implications – Owing to data constraints, no cost estimates are provided
for some impact such as: degradation associated with industrial, hazardous and hospital waste,
biodiversity loss, and impact of inadequately treated wastewater, thus calculations often represent
lower bound estimates.
Originality/value – This paper is a contribution in a process towards the use of environmental
damage cost assessments for priority setting and as an instrument for integrating environmental
consideration into economic and social development.
Keywords Middle East, North Africa, Assessment, Damages, Environmental management
Paper type Research paper
Introduction
The MENA region now faces unique development and environment challenges, such
as high rates of unemployment (nearly 18 per cent of the regional workforce was
unemployed in 2002), lack of economic diversifications (their dependence on oil and
agriculture and the concentration of industry in relatively narrow range of low
productivity activities, declining per capita water resources, the loss of arable land,
pollution-related health problems, and weak environmental institutions and legal
This paper was presented at the International Symposium on Drylands Ecology and Human
Security (ISDEHS) Dubai, 4-7 December 2006.
Management of Environmental
Quality: An International Journal
Vol. 19 No. 3, 2008
pp. 305-317
q Emerald Group Publishing Limited
1477-7835
DOI 10.1108/14777830810866437
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frameworks. Despite some improvements over the past decade, future generations in
the region will continue to face serious environmental problems unless significant
attention is given, and investments are made, to reverse the current state of
environmental degradation, particularly with regard to water scarcity, pollution and
health problems, land degradation and weak environmental institutions and legal
frameworks. Although environmental concerns within the MENA region are becoming
salient, and every country now has an environment ministry or agency, many
countries are still depleting their natural resources at rates well above sustainable
levels. One indicator of this deterioration is adjusted net savings, which measures the
true saving rate in an economy after allowing for depletion of natural resources.
Adjusted net savings in MENA for 2001 is estimated at 6 per cent of gross national
income, compared to 1 per cent in Sub-Saharan Africa, 5 per cent in Latin America, 12
per cent in South Asia, and 23 per cent in East Asia and the Pacific.
Despite the difficulties involved in assigning monetary costs to environmental
degradation, such estimates can be a powerful means of raising awareness about
environmental issues and facilitating progress toward sustainable development. It is far
easier for decision-makers to incorporate and prioritize environment when the issues can
be cast in clear economic terms. Such assessments are particularly relevant in light of the
mainstreaming effort called for by the World Bank Environment Strategy (World Bank.
Middle East and North Africa Environment Strategy, February 1995). An initiative in the
MENA region, undertaken in collaboration with the Mediterranean Environmental
Technical Assistance Program (METAP), is assisting countries in assessing the costs of
environmental degradation, with the aim of fostering integration of environmental issues
into broader economic development agendas. Similar exercises have been undertaken in
other countries with World Bank support. For instance, in Colombia, it is being
undertaken as part of a country environmental analysis and is influencing priority
setting for a structural adjustment loan. However, the MENA initiative is particularly
interesting in being undertaken at a region-wide level.
The cost of environmental degradation can be understood as a measure of lost
welfare of a nation due to environmental degradation. Such a loss in welfare from
environmental degradation includes (but is not necessarily limited to):
.
loss of healthy life and well-being of the population (e.g. premature death, pain
and suffering from illness, absence of a clean environment, discomfort);
.
economic losses (e.g. reduced soil productivity and reduced value of other natural
resources, lower international tourism); and
.
loss of environmental opportunities (e.g. reduced recreational values of lakes,
rivers, beaches, forests for the population).
In this paper the cost of environmental degradation is expressed as a percentage of
GDP in order to provide a sense of magnitude. It is also often useful to compare the cost
of degradation to GDP in order to assess their relative magnitude over time. If the cost
of degradation as a percentage of GDP is growing over time, it suggests that the
welfare loss from environmental degradation is growing faster than GDP, i.e. that
economic and human activity is having increasingly negative (environmental)
consequences on the nation relative to its economic affluence. If the contrary is the case,
it suggests that environmental consequences are being reduced relative to the nation’s
economic affluence.
Overview of the MENA region and the environment sector
The countries of the MENA region are home to about 6 per cent of the world’s
population (see Figure 1).
The total population of the region has increased from around 100 million in 1950 to
around 380 million in 2000 – an addition of 280 million people in 50 years. During this
period the population of the MENA region increased 3.7 times, more than any other
major world region. The MENA region has an area of about 11.1 million Km2. The
region’s share in global oil production will increase from 35 per cent today to 44 per
cent in 2030. Oil production (including natural gas liquids) is projected to rise from
29mb/d in 2004 to 33mb/d in 2010 and to 50mb/d by 2030. However, this means the
countries of the Middle East and North Africa would need to invest, on average, $56
billion per year in energy infrastructure.
The region is threatened by the loss of arable land and increased coastal
degradation, which are caused principally by unsustainable agricultural practices and
unmanaged competition for land and marine resources. Permanent cropland, currently
less than 6 per cent of the total land area, is shrinking due to serious land degradation
and recurrent droughts. Pollution-related health problems, particularly in urban and
industrial centers, represent another challenge. The causes include open municipal
waste dumps; the use of leaded gasoline in an aging and poorly maintained vehicle
fleet; the inefficient use of fossil fuels for power generation; and particulate and sulfur
oxide emissions from industry. Finally, weak environmental institutions and legal
frameworks prevent countries from adequately addressing environmental challenges
like the three described above.
Annual renewable water resources per capita are expected to fall from 1997 levels of
1,045m3 per year to 740m3/yr by 2015. Despite growing urban populations, an average
of 88 per cent of MENA’s water resources are allocated to the agriculture sector, with
only 7 per cent going toward domestic consumption. Water scarcity is aggravated by
increased degradation of water quality, which primarily affects the region’s poor.
Literature review
The interest in taking into consideration the economic sides of environmental
degradation can be traced back to the works of Scitovsky (1954) and Meade (1973).
These studies established the theory of externalities. By an externality, economists
refer to a non-market consequence (or an unanticipated consequence, which leads to the
same result) on the well-being of individuals or the performance of firms, such as an
increase or a decrease in the quality or the availability of an environmental good or
service provided that this effect has not been compensated in one way or the other
(through payment, agreement, etc.). An external cost is a negative externality while an
external benefit is a positive externality.
Thus, it is not the environment per se, which is taken into account by individuals or
firms but rather the environmental consequences of the various activities of the latter.
The object of the evaluation is not “Nature” but the decrease in its quality (polluted air
and water; endangered public health, etc.) or its capacity to provide environmental
services (degraded soil, diminished carrying capacity, etc.). These “new” economic
goods and services appeared with the emergence of new environmental values (clean
air and water, safe surroundings, restored carrying capacities, etc.) (Pillet, 1976). In
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Figure 1.
An overview of the MENA
region
short, restoring a degraded environment is “producing” benefits having an economic
value in terms of their contribution to general well being.
In Switzerland, the first evaluations of the costs of environmental degradation were
undertaken in the 1970s for air pollution (EPFL, 1977, Ciba-Geigy, 1978, Berlin, 1981),
then in the 1980s in a more comprehensive manner (Ledergerber, 1984, Frey, 1986,
Pillet, 1988, Walther, 1990). In the mid-1980s, the cost of environmental degradation in
Switzerland was close to 10 billion USD/year; that is approximately 5 per cent of the
GDP at the time (Pillet, 1991).
At the international level, studies on the cost of environmental degradation have
been undertaken since the 1970s mainly by the OECD (1975, 1989), the World Bank
(1991) as well as certain universities. Two trends have been developed in parallel: one
being the environmental evaluation in its economic dimension (Markandya, 1991;
Pillet, 1993) and the other being the integration of environmental degradation and the
value of natural heritage in national accounting (Eurostat, 1990; Pillet, 1992; Franz and
Stahmer, 1993).
In the Arab Mediterranean countries (as well as in other regions in the world), the
question of the economic cost of environmental degradation was raised with the
development of National Environmental Action Plans (NEAP). In 1995 in particular,
the World Bank published its Environmental Strategy for the Middle East and North
Africa (MENA). It presented, based on 1990 data, the first estimates in order of
magnitude of the costs of environmental degradation in the region, particularly those
related to the impacts on human headline associated with a lack of safe drinking water
and appropriate sanitary measures and those on the degradation of natural resources
(mainly erosion and soil salinity).
Subsequently, many specific studies were accomplished under the auspices of the
German GTZ, METAP-The World Bank (2003) program, UNDP, USAID, and other
organizations, namely in Algeria, Egypt, Iran, Jordan, Lebanon, Morocco, Syria and
Tunisia (e.g. Algerian NEAP/PNAE-DD, 2002; Larsen et al., 2002a). In parallel to these
macro-economic evaluations, others, of a meso-economic level, were undertaken for the
cement sectors in Algeria, Tunisia, Morocco, Libya and Syria (Pillet and Zein, 2002b;
Pillet et al., 2004), for urban communities in Morocco and Jordan (Pillet et al., 2004), and
for fossil-fuelled electricity generation in Morocco (Pillet et al., 2004). The purpose is to
evaluate, in economic terms, the environmental costs and benefits of economic sectors
and regions while allowing them to better situate themselves with respect to
macro-economic evaluations that are hard to grasp at their scale due to their highly
aggregated level. Indeed, a city, just like an industrial sector, needs a territory,
consumes a number of resources (water, energy, primary products, etc.) and transforms
them into goods and services whilst generating a number of discharges (solid, liquid
and gas), thus putting pressure on the ecosystems it depends on. Such a representation
of a city or an industry fixes the boundaries of the system analyzed, i.e. the flows of
nature and the economy and their transformation – their metabolism – at the scale of
an urban community or of an industrial sector
The study: rationale, objectives, and methodology
Neglect of the environment is costing MENA economies as much as 5.7 percent of
national growth and the extent of degradation are accelerating (Sharif Arif, 2003). The
MENA countries face serious problems of environmental degradation that must be
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addressed immediately because failure to act now will greatly compound the cost and
complexity of later remedial efforts, and because environmental degradation is
beginning to pose a major threat to human well-being, especially among the poor in the
region. Environmental problems in the region are not abstract issues that only the rich
can afford to address. These long-lasting challenges have significant impacts on the
economy and on human health. As estimated in the National Environmental Action
Plans of countries in the region, the annual cost of environmental damages ranges from
2.1-7.4 per cent of GDP. These costs are higher than those for Eastern Europe (5 per
cent) and substantially higher than those of OECD countries (2-3 per cent).
This paper is a step in a process supported by many agencies (international and
local) to use environmental damage cost assessments as an instrument in
environmental management. The specific objectives of this paper are three-fold:
(1) Provide an estimate of the cost of environmental degradation in MENA using
the most recent data available.
(2) Provide an analytical framework that can be applied periodically by
professionals in MENA to assess the cost of environmental degradation over
time.
(3) Provide a basis for ministries, agencies, institutes and other interested parties to
incorporate assessments of the cost of environmental degradation into
policymaking and environmental management.
To achieve the above objectives a framework was developed to estimate the cost of
environmental degradation in seven countries (Algeria, Egypt, Lebanon, Morocco,
Syria, Tunisia, and Iran) in the region out of 19 countries with the following
assumptions:
.
Estimates reflect order of magnitude and therefore represent an indication of
actual damage costs. A range of estimate has been provided to reflect the
uncertainty of the results.
.
1999 or 2000 are used as a reference year.
.
Damage costs are presented in annual values (in local currencies, in US$ Dollars)
and as a per cent of GDP. Expressing costs as a share of GDP provides a sense of
magnitude and will allow cross-country comparison.
.
Owing to data constraints, no cost estimates are provided for some impact such
as: degradation associated with industrial, hazardous and hospital waste,
biodiversity loss, and impact of inadequately treated wastewater, thus
calculations often represent lower bound estimates.
The seven countries are chosen because their population represents 67 per cent of the
total MENA population, their area represents more than 70 per cent of total area, and
all of them are coastal countries.
An attempt has been made to capture what may be expected to be the most
significant costs of degradation. However, data limitations have been a constraint,
which implies that estimates in some environmental areas are not included. Hence, the
total estimate of environmental degradation, as presented in this study, is likely to
underestimate the true costs of degradation.
The cost of environmental degradation can be understood as a measure of the lost
welfare of a nation due to environmental degradation. Such a loss in welfare from
environmental degradation includes (but is not necessarily limited to):
.
loss of healthy life and well-being of the population (e.g.: premature death, pain
and suffering from illness, absence of a clean environment, discomfort);
.
economic losses (e.g.: reduced soil productivity and reduced value of other
natural resources, lower international tourism); and
.
loss of environmental opportunities (e.g.: reduced recreational value for lakes,
rivers, beaches, forests).
In this paper the cost of environmental degradation is expressed as a percentage of
GDP in order to provide an order of magnitude. It is also useful to compare the cost of
degradation to GDP to assess the relative magnitude over time. If the cost of
degradation as a percentage of GDP grows over time, it suggests that the welfare loss
from environmental degradation is growing faster than GDP, i.e. that economic and
human activity is having increasingly negative (environmental) impacts on the nation
relative to their economic affluence. If the contrary is the case, it suggests that
environmental impacts are decreasing relative to the nation’s economic affluence.
The process of estimating the cost of environmental degradation involves placing a
monetary value on the consequences of such degradation.
This paper has utilized available information on the quantification of environmental
degradation in MENA and the consequences of degradation.
To estimate the cost of environmental degradation for various aspects of the
environment, the analysis and estimates have been organized into six categories:
(1) Indoor and outdoor air pollution.
(2) Lack of access to water supply and sanitation services.
(3) Land degradation.
(4) Coastal zone degradation.
(5) Waste management.
(6) Global environment.
For each of these categories there are separate analyses and cost estimates for:
.
health/quality of life; and
.
natural resources.
The results
The costs of environmental degradation reached about US $17.4 billion in seven
MENA countries at the beginning of the millennium (2000), and the indicators of these
countries with respect to environmental sustainability are very low. Estimates include
environmental damage from such sources as indoor and outdoor air pollution, lack of
access to water and sanitation services, land degradation, coastal zone degradation,
and waste management. In addition to the damages to the national economy, Table I
presents damage to the global environment through greenhouse gas emissions. Overall
damage cost estimates for seven countries are presented in vary from 2.1 percent of
gross domestic product (GDP) in Tunisia to be as high as 7.1 percent of GDP in Iran
Costs of
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(Table I). This high cost of environmental degradation negatively affects public health,
household budgets, the competitiveness of the economy, and inter-generational equity,
whereby the rate of mining and degradation means that many of the resources will not
be available in the future. The annual cost of environmental degradation in Iran was
estimated at 4.8 to 10 per cent of GDP, with a mean estimate of 7.4 per cent (equivalent
to US$ 8.4 billion). The estimates presented indicate the severity and magnitude of
environmental degradation in Iran. The environmental degradation cost estimated in
this paper only shows one side of the coin. Any policy action that causes environmental
damages also produces benefits to society.
These results are underestimates: because of data limitations, they do not include
stemming from untreated industrial, hazardous, and hospital wastes or losses of forest
cover and biodiversity. Also owing to data constraints, the impact of inadequate
treatment of industrial and municipal wastewater is limited to coastal recreational and
tourism losses.
The discussion that follows is confined to the national effects of environmental
degradation.
Air pollution
Research evidence from around the world shows that, indoor and outdoor air pollution
has significant negative effects on public health, and results in premature deaths,
chronic bronchitis, respiratory disorders, and even cancer.
The most significant air pollutant in terms of health impacts is particulate matter,
especially fine particulates (PM10), and the studies therefore looked at PM10 levels in
major polluted cities in the region. In Cairo and Alexandria, Egypt, damage from urban
air pollution is estimated to cost almost 2 percent of GDP. This figure includes
mortality (it is estimated that each year about 20,000 people in these cities die from air
pollution-related causes), morbidity, and potential loss of tourism revenue.
The use of biomass fuel for cooking and heating can give rise to indoor air pollution
that threatens health, especially that of women and young children, who spend
disproportionately more time indoors than do men. The studies analyzed biomass fuel
use in rural areas to assess the potential health impact of indoor air pollution and found
that, on average, damage cost from this source ranges between 0.15 and 0.45 per cent of
GDP (Table II). This is relatively low compared with costs in Sub-Saharan Africa,
South Asia, and the East Asia and Pacific region. A probable explanation is that in
Table I.
Average annual damage
costs of environmental
degradation, in MENA
countries (percentage of
GDP)
Air pollution
Lack of access to water supply and
sanitation
Land degradation
Coastal zone degradation
Waste management
Subtotal
Global environment (CO, emissions)
Total
Algeria
Egypt
Lebanon
Morocco
Syria
Tunisia
Iran
1.0
2.1
1.0
1.0
1.3
0.6
1.6
0.8
1.2
0.6
0.1
3.6
1.2
4.8
1.0
1.2
0.3
0.2
4.8
0.6
5.4
1.1
0.6
0.7
0.1
3.5
0.5
4.0
1.2
0.4
0.5
0.5
3.7
0.9
4.6
0.9
1.0
0.1
0.1
3.4
1.3
4.7
0.6
0.5
0.3
0.1
2.1
0.6
2.7
2.82
2.5
0.15
0.36
7.43
1.36
8.8
Source: Adapted from METAP/The World Bank, Beirut Meeting, June 2003
Percentage share in GDP
Country
Indoor
Outdoor
Egypt
Syria
Morocco
Lebanon
Algeria
Tunisia
Iran
0.3
0.0
0.4
0.15
0.3
0.2
0.28
1.8
1.3
0.6
0.85
0.7
0.4
1.32
Source: Calculated from Table I
Costs of
environmental
degradation
313
Table II.
Annual damage cost from
air pollution
MNA the proportion of rural to total population is much lower than in the other
regions, and energy services (e.g. electrical grids and natural gas networks) are more
geographically dispersed, hence leading to less dependence on biomass.
Lack of access to water supply and sanitation
Water supply problems – substandard quality and insufficient quantities of potable
water for drinking and hygiene - and inadequate sanitation facilities impose costs on
society, notably in the form of waterborne illnesses and the associated mortality. Of
these illnesses, the most common is diarrhea disease, which has the greatest impact on
young children. In Morocco, for example, lack of access to water supply and sanitation
is estimated to cost society 1.0 to 1.5 percent of GDP (Table III). This estimate takes
into account child mortality from diarrhea (6,000 deaths of children under age five each
year); diarrhea child morbidity; and the time spent by caregivers in attending to ill
children. The estimates also include loss of water storage capacity due to dam silting.
The overall cost is understated; it does not include damage to fisheries, ecosystems,
and biodiversity as a result of water pollution.
In Lebanon, where municipal tap water is perceived to be of low quality, the
population consumes about 115 l of bottled water per capita per year. After adjusting
for lifestyle and taste, the estimated expenditure on bottled water for preventive health
reasons comes to 0.5 percent of GDP.
Land degradation
In most MENA countries soil salinity, water erosion, and rangeland degradation affect
agricultural productivity and the supply of livestock fodder. Although precise data are
not available for each source of land degradation, orders of magnitude have been
estimated to give some perspective on the economic impact of degradation (Table IV).
In Syria salinity is especially critical in the Euphrates basin, where more than 40 per
cent of total irrigated land is affected to varying degrees. Overall, it is estimated that
Country
Percentage share in GDP
Algeria
Egypt
Lebanon
Morocco
Syria
Tunisia
Iran
0.8
1.0
1.1
1.2
0.9
0.6
2.82
Source: Calculated from Table I
Table III.
Annual damage cost from
lack of access to water
supply and sanitation
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125,000 hectares suffer from high soil salinity, resulting in a 37 per cent decline in
yields of cotton and wheat, the main irrigated crops. The total annual loss in
agricultural productivity is estimated at around US$80 million, or 0.45 per cent of GDP.
In some cases other impacts on land degradation, such as quarrying activities, were
assessed as well.
In Lebanon uncontrolled quarrying in the past has caused major destruction of
natural vegetation and habitat. A survey undertaken to assess the impact of three
abandoned quarries on the surrounding environment revealed that the price of nearby
land and apartments overlooking the three quarries were lower than prices for
comparable properties further away from the quarries by US$90 million. In general,
land degradation estimates are understated because they do not include damage to
natural habitats and ecosystems or losses in forestland and biodiversity.
Coastal zone degradation
The coastal resources represent an important cultural, ecological, economic, and
recreational asset. But uncontrolled urban development, untreated industrial and
municipal discharge, and port activities have contributed to coastal pollution. Marine
ecosystems, such as the coral reefs around Hurghada, Egypt, on the Red Sea, have
suffered irreversible damage. In Lebanon the cost of coastal zone degradation is
estimated at 0.7 per cent of GDP (Table V); this estimate includes loss of international
tourism revenues, effects on domestic tourism, and the cost, in lost ecological and
non-use value, of sea turtle extinction. In Tunisia, where 90 per cent of tourism
revenues are derived from coastal zone recreation, a contingent valuation survey was
undertaken to assess international tourists’ willingness to pay to improve beach
cleanliness and water quality and reduce overcrowding. In total, 12 percent of the
tourists interviewed were willing to pay about EU 20 per stay (5 percent of their
average expenditure), implying a total of about US$37 million per year.
Lebanon has a Mediterranean coastline of 225kms. Urbanization, uncontrolled
development of resorts, and the practice of dumping untreated municipal wastewater
and solid waste into the sea have contributed to the degradation of the shoreline,
especially around the capital, Beirut, and the Bay of Jounieh. This deterioration has
forced people to travel greater distances in search of cleaner beaches.
A survey undertaken in 2002, assessed incremental travel costs in order to quantify
the loss in recreational value. It showed that 415,000-580,000 day trips each year were
Country
Table IV.
Annual damage cost from
land degradation
Percentage share in GDP
Egypt
Lebanon
Morocco
Syria
Tunisia
Iran
1.2
1.2
0.6
0.4
1.0
0.5
2.50
Algeria
Egypt
Lebanon
Morocco
Syria
Tunisia
Iran
0.6
0.3
0.7
0.5
0.1
0.1
0.15
Source: Calculated from Table I
Country
Table V.
Annual damage cost from
coastal zone degradation
Algeria
Percentage share in GDP
Source: Calculated from Table I
being made from the Beirut area to five natural beaches located between 28 and 62kms
from Beirut. The incremental travel cost to these areas was estimated at US$21 per day
per visitor, on the basis of additional travel distance; a vehicle operating cost of
US$0.45 per km; a time value of US$3.7 per hour of travel time per person; and
observed vehicle occupancy. Total incremental travel costs came to US$10 million per
month,US$120 million per year.
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degradation
315
Waste management
Uncollected municipal and household waste attracts rodents and flies and other insects.
These may carry infectious diseases that put children and individual trash pickers at
risk. In most of the countries a contingent valuation method was used to assess people’s
willingness to pay to improve waste collection and street sweeping. A 1995 survey
undertaken in Rabat and Salé, Morocco, revealed an average willingness to pay of
US$4.7 per household per month. Adjusting this figure for inflation and aggregating it to
other cities in Morocco yielded a nationwide urban figure of around US$170 million,
about 0.5 percent of Morocco’s GDP (Table VI). Some surveys looked at the impact of
unsanitary landfills on the environment. Landfills in rural or semi-rural areas had
somewhat limited impacts, but the closure of the unsanitary landfill in Tunis in 1995 was
found to be responsible for a rise of more than 35 per cent in real estate prices in the area.
In Morocco the cost associated with pollution of groundwater by leakage from
unsanitary landfills was estimated at US$25 million per year.
Conclusion
This study indicates that the cost of environmental degradation in MENA is in the
range of 2.7-8.8 percent of GDP (including global environment cost) with a mean
estimate of 5.7 percent. This is substantial and about 1.5 times higher than in
high-income countries. The main reasons for this are:
.
a significant disease burden (mortality and morbidity) and avertive expenditures
associated with a lack of safe water and sanitation and inadequate hygiene;
.
substantial negative impacts on health from severe air pollution; and
.
the significant cost of land and coastal resources degradation.
This paper also suggests that MENA would benefit significantly from remedial action
to protect and restore the quality of the environment, although estimates are tentative.
Further analysis of costs and benefits of select environmental issues considered
priority areas by the Governments of MENA countries would facilitate the process of
priority setting and improved environmental management as well as promote
intersectoral support for action. Future cost analyses of importance should include a
more in-depth assessment of the impacts of environmental quality on tourism and
recreation (coastal and inland), a cost benefit analysis of urban air pollution, and the
Country
Percentage share in GDP
Algeria
Egypt
Lebanon
Morocco
Syria
Tunisia
Iran
0.1
0.2
0.1
0.5
0.1
0.1
0.36
Source: Calculated from Table I
Table VI.
Annual damage cost from
waste management
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cost of land resources degradation (agriculture, quarries and construction, and
deforestation).
This analytical work has proved to be very effective in MENA countries. In Algeria
the results were applied at the highest political levels in deciding on important
investments in environmental protection, totaling about US$450 million. In Egypt the
study has sparked interest in further analysis of the cost of environmental degradation at
the government level, in Damietta, Qena, and South Sinai. In Tunisia the (National
Environment Protection Agency) is interested in setting up a unit of environmental
economists who will be trained to undertake economic analysis of environmental
projects.
References
Algerian NEAP/PNAE-DD (2002), National Environmental Action Plan/Plan National d’Actions
pour l’Environnement et le Développement Durable, République Algérienne Démocratique et
Populaire, Ministère de l’Aménagement du Territoire et de l’Environnement, Alger, p. 140.
Larsen, B., Sarraf, M. and Pillet, G. (2002), “Cost assessment of environmental degradation in the
Mashreq and Maghreb countries – from theory to practice. Cost Assessment of
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Further reading
Allard, G. (2001), “The fires situation in the Islamic Republic of Iran”, in FRA Global Fire
Assessment 1990-2000, Working Paper No. 55, Forest Resources Assessment Program,
FAO, Rome, pp. 198-202.
BC Berlin (2004), Tehran Solid Waste Management Project: Landfill Preparation Study, Final
Report, Organization for Waste Recycling and Composting (OWRC).
Belhaj, M. (1995), The Willingness to Pay for Better Household Waste Collection in Rabat-Sale,
Gothenburg University, Morocco.
Huybers, T. and Bennett, J. (2003), “Environmental management and the competitiveness of
nature-based tourism destinations”, Journal of Environmental and Resource Economics,
Vol. 24, pp. 213-33.
Maradan, D., Pillet, G. and Zingg, N. (2001), “Appraising externalities of the Swiss agriculture: a
comprehensive view”, in Ulgiati, S. (Ed.), Porto Venere Advances in Energy Studies,
University of Siena, Siena, p. 16.
Sarraf, M. (2004), Assessing the Costs of Environment Degradation in the Middle East and North
Africa Region, Environment Strategy Notes No. 9, The World Bank, Washington, DC.
Sarraf, M., Larsen, B. and Owaygen, M. (2004), Cost of Environmental Degradation: The Case of
Lebanon and Tunisia, Environment Department Papers.
United Nations Environment Program (2003b), State and the Environment in the Arab World,
Progress Report (UNEP/ROWA/CAMRE/15/2003/Rev5, 29 November).
United Nations Environment Program (2003), UNEP Strategy for West Asia, 2003-2005,
UNEP/ROWA/CAMRE.15/2, United Nations.
World Bank (2004e), Islamic Republic of Iran: Report No. 29062-IR. Middle East and North Africa
Region, Washington, DC.
World Bank (2002), Arab Republic of Egypt: Cost Assessment of Environmental Degradation,
Sector Note, Report 25175-EGT, Washington, DC.
Corresponding author
Muawya Ahmed Hussein can be contacted at: [email protected]
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