Economic Assessment of Sanitation Interventions in Vietnam - WSP

Economic Assessment of Sanitation Interventions in Vietnam | Efficiency of Improved Sanitation and HygieneFIGURE 50: SUMMARY OF AVERAGE BENEFIT-COST RATIOS IN URBAN SITES, SANITATION VERSUS SANITATION WITH HYGIENEOD topit latrineSanitationSanitation + HygieneOD toseptic tankSanitationSanitation + HygieneOD toWWMSanitationSanitation + HygieneBCR idealBCR actualKey: WWM - wastewater management0 2 4 6 8 10BCR values94Table 50 shows that actual benefits per US$1 input fromall sanitation options amounted to more than US$1, witha benefit-cost ratio (BCR) ranging from 2.4 to 6.8. Underthe ideal scenario, higher BCR values ranging from 2.7 to8.6 were found. The highest BCR was found when movingup to on-site pit latrine (ideal 8.6, actual 6.8). Actual benefitsas a proportion of ideal benefits ranged from 78.3%to 90.5%. The most closely matching values between idealand actual were found with centralized wastewater managementsystems (2.4 and 2.7), showing a high rate of capacityutilization. The highest actual and ideal benefits came frommoving from open defecation (OD) to pit latrine. The reasonsfor the differences between ideal and actual benefitsof sanitation interventions are incomplete treatment levelsand under capacity service of facilities, associated with planning,design and construction, and management activities.Hygiene interventions added to health benefits at low cost,and BCRs were higher for sanitation plus hygiene than forsanitation alone (see Figure 50).Different internal rates of return (IRR) have been found.From a starting point of open defecation, the highest IRRwas found from the adoption of an on-site pit latrine (morethan 100%). IRR values were much higher than bank interestrates and those from government bonds, showing thepossibility of mobilizing different financial resources to investin sanitation systems, based on social returns.The actual payback period ranged from less than 1 year(moving from OD to a pit latrine) to 5 years (moving fromOD to a centralized wastewater treatment system). Thisshort payback period is a key finding of this study, makingsanitation a very attractive investment for government andsocial investors.The actual net present value of the sanitation optionscompared to ‘no toilet’ ranged from VND24,356,000(US$1,625) for centralized wastewater management toVND24,925,000 (US$1,750) for a pit latrine.In terms of cost-effectiveness, with respect to health outcomes:• Actual cost per disability-adjusted life year (DALY)averted ranged between VND7,099,000 (US$406)for a wet pit latrine and VND20,726,000 (US$1,185)for centralized wastewater management.• Actual cost per case averted ranged fromVND154,000 (US$8.8) for a wet pit latrine toVND1,256,000 (US$71.8) for centralized wastewatermanagement.• Actual cost per death averted ranged fromVND133,608,000 (US$7,640) for a wet pit latrineto VND391,909,000 (US$22,410) for centralizedwastewater management.Economic Assessment of Sanitation Interventions