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Water pollution in poor countries
SURVEY: DEVELOPMENT AND THE ENVIRONMENT
Water hazard
Mar 19th 1998
From The Economist print edition
Clean up�or risk many deaths
RIVERS in rich countries have become steadily cleaner over the past couple of decades. Rivers in the poorest developing countries, by contrast, have shown marked falls in levels of dissolved oxygen�a key indicator of increased pollution by sewage. An estimated 90% of sewage in developing countries is discharged into rivers, lakes and seas without any treatment. To make things worse, supplies of fresh water that might dilute the sewage are dwindling in many areas.
Asia's rivers, which are among the most polluted in the world, contain ten times as many bacteria from human waste as waterways in rich countries. They contain far more lead too, much of it from industrial effluents. In China, farm chemicals washing into the sea are being blamed for massive blooms of algae. But the biggest cause of water pollution in developing countries is sewage, and its most important effect is on human health.
Each year, according to the World Health Organisation, 900m people suffer from diarrhoea or diseases spread by contaminated water such as typhoid and cholera, and at least as many from diseases caused by intestinal worms. Better water supplies and sanitation would cut the incidence of such diseases dramatically. In terms of the number of people it kills, dirty water is probably the world's most serious pollution problem.
There have been big improvements in recent years: since 1980 some 2 billion people in developing countries have gained access to better water supplies, and another 400m have got better sanitation. But these gains have in large part been offset by population growth. One billion people still do not have an "adequate" supply of water, and 2 billion do not have access to "adequate" sanitation facilities, even as defined by their governments, which often use the term to describe a single water tap shared between hundreds of people.
To improve matters for their people now, and to keep up with future population growth, developing countries will need to invest huge sums in water and sanitation: current investment in the sector, although inadequate, already totals $25 billion-30 billion a year. In theory this should be feasible. Even the poorest people appear to be willing to pay for clean, piped water, and for the provision of basic sewerage. In many countries, families with no piped water connection now pay salesmen for containers of clean water. Such water costs typically 12 times as much as piped supplies, yet slum-dwellers have no choice but to fork out a huge proportion of their income for it: according to one study, in parts of Nigeria and Haiti water accounts for about 20% of household expenses. Studies also suggest that many poor people are willing to pay to keep sewage away from their homes.
Yet water utilities in developing countries are often bureaucratic, inefficient and corrupt. In Western Europe, water firms typically employ two or three people for every 1,000 water connections. In most of Latin America, the figure is between 10 and 20, says John Briscoe, a water expert at the World Bank. Throughout the developing world a large proportion of water�sometimes more than half�is lost through leaky pipes and theft, costing utilities huge sums in forgone revenues.
With few exceptions, consumers the world over are charged less for their water than it costs to provide. Water is seen as more of an entitlement than a commodity with a price-tag attached. A survey of water projects financed by the World Bank showed that the average price charged for water covered only a third of the cost of supplying it. Typically this shortfall is made up by government subsidies, or by allowing the infrastructure to decay.
But artificially low water prices cause particular problems in developing countries. Where water is piped, consumers are given little incentive to conserve it, even though in many big cities the cost of supplying it is increasing steadily as nearby sources get used up or become contaminated. Shanghai, for example, has had to spend $300m moving its intake of water further away from the city because nearby river waters had become too polluted.
Forced to rely on government handouts to recoup the cost of their investment, water utilities often pay more attention to what politicians want than what consumers need. One common error is to invest in hugely expensive treatment plants for sewage when cheaper options would do. Pumping raw sewage far out into the deep sea, for example, is often enough to avoid the worst effects.
Most damaging of all, utilities and governments are reluctant to connect new customers because water prices are too low to allow them to recoup their investment. This is one reason why so many poor people remain unserved, even if they are willing to pay. Paradoxically, therefore, the subsidies meant to make sure that water is a basic entitlement for everybody end up penalising the poor.
If governments are unable to meet the water needs of many people in poor countries, someone else must. The most popular of the alternatives that have emerged in recent years have been to hand over the job to private firms, and to let communities fill the gap. But there are limits to both.
Private problems
Start with privatisation. Across Brazil and Argentina, local governments are handing out water concessions to private firms. In the Philippines, the city of Manila recently awarded contracts to run the city's water and sewerage services to two private consortia. The local government in Izmit, in north-western Turkey, asked Thames Water, London's water utility, to head a $865m local project to build a dam and water-treatment plant.
The involvement of private companies often produces dramatic improvements in efficiency within a few years, and provides the capital needed to connect millions of new customers. For example, in 1992 a consortium led by a French firm, Lyonnaise des Eaux, won a 30-year contract to run water and sewerage services in Buenos Aires; by 1995 it had cut the labour force from 7,500 to under 4,000, and renovated thousands of kilometres of pipes.
But the same problems that dog public water utilities�corruption, political sensitivity and low prices�affect private ones too. In order to attract private firms in the first place, local governments usually need to promise that water charges will rise. But local governments change, and the next incumbents are often tempted to deflect public anger over rising water charges and lost jobs by rewriting or even cancelling the contract with the private firm.
All this means that few of the investments made by private firms in developing countries� water businesses have yet turned a profit. Several British water utilities have recently made provisions for foreign deals that have gone sour. Many firms have concluded that it is less risky to go for managing existing systems rather than to make new investments. "Water and sewerage is a low-return, high-risk business," says the World Bank's Mr Briscoe.
Not surprisingly, therefore, the number of firms willing to pitch for water business in developing countries is strictly limited. The only players are the French and the British water utilities and a handful of American firms. The French have been contracting out their water systems since the 19th century, and the British privatised their water utilities in 1989. But in most other rich countries the water business is still run either by the state or by private firms too small to compete internationally. The picture is very different in the electricity industry, where large privatised firms from many rich countries are falling over themselves to build and run power plants in developing countries. So of the $150 billion of private infrastructure investment made in developing countries between 1990 and 1995, a third went into the electricity sector and less than a tenth into the water and waste sectors.
Can communities help themselves? Development bankers like to talk about a project in the slums of Orangi in Pakistan's capital, Karachi. Although the water supply in this area was reasonable enough, there was no system for collecting sewage, so it gathered in the streets, causing obnoxious smells and diseases. In a community project with just a slither of outside funding, local people got together to build their own sewers, contributing both money and labour. They kept the cost of building a toilet and basic underground sewage pipes down to 1,000 rupees ($23) per household, a fifth of the cost of government-run projects. Over 12 years, they installed sewers serving over 90,000 homes and contributed $2m from their own pockets. It was money well spent: where sewers had been built, property prices rose steeply.
In north-east Brazil, too, a sewerage system combining cheaper technology and community involvement has proved a runaway success. Known as the "condominial" system (named after a Brazilian soap opera about the good life), it is based on a single sewage pipe running from house to house, rather than separate pipes for each house connected to a mains sewer, as in the more expensive conventional system. Unusually, it is local people who are responsible for maintaining the sewage piping in their neighbourhood. They have a big incentive to take care of the system, because if any one of them causes a blockage to his pipe, his neighbours will be in trouble too. This communal pressure means that the "condominial" system costs less to maintain, as well as to build, than traditional sewerage systems.
Some communities have successfully taken the initiative over ordinary rubbish as well as waste water. The rubbish business, much like sewerage, is often ill-served by corrupt and inefficient utilities. Within Bangkok's Klong Toey slum, there is one area relatively free of stinking refuse. Residents in this area pay for a scheme which rewards people with eggs for every bit of rubbish delivered to a collection point. This turns out to be cheaper than bribing official rubbish collectors to do their job.
Yet such examples are rare, and community action is clearly not the whole answer. To be successful, it needs to be able to draw on an existing sense of community (rare in settlements of recently arrived migrants from the countryside), and on forceful and charismatic local leaders.
The scope of such schemes, in any case, is limited to solving environmental problems caused by, and felt by, the community itself. Inevitably governments or utilities will be responsible for dealing with sewage delivered by the community to the trunk mains, and for finding a final resting place for rubbish collected by residents� groups. To tackle all the problems of waste and dirty water, therefore, politicians must concentrate on making public utilities more efficient, weeding out corruption, and cutting subsidies. They are faced with the same difficult tasks in their efforts to tackle air pollution, the subject of the next article.
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Source: The Economist
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