World Bank, 2002

This report is a first step in a process towards the use of environmental damage cost assessments for priority setting and as an instrument for integrating environment into economic and social development. The report provides estimates of damage and remediation cost for several areas of the environment. The estimates should be considered as orders of magnitude, and a range is provided to indicate the level of uncertainty. As areas of priority are identified, further analysis would be required for more accurate estimates.

The damage cost of environmental degradation in Egypt in 1999 is estimated at LE 10-19 billion per year, or 3.2-6.4 % of GDP, with a mean estimate of LE 14.5 billion or 4.8% of GDP. In addition, the damage cost to the global environment is estimated at 0.6% of GDP. The cost of air pollution is assessed at LE 3.3 - 9.6 billion or 1.1-3.2% of GDP (urban outdoor and rural indoor), followed by soil degradation at LE 3-4.2 billion or 1.0-1.4% (erosion and salinity). In the area of water, the damage cost is estimated at LE 2.1-3.6 billion or 0.7-1.2% of GDP (mostly from the lack of safe water, sanitation, and hygiene). Cost of coastal zone degradation is estimated at LE 0.6-1.2 billion or 0.2-0.4% of GDP, arnd inadequate waste management at around LE 0.6 billion or 0.2% of GDP. Of total damage cost about 2/3 is from damages to health and 1/3 from natural resource degradation. It should be noted that no cost estimate is provided for degradation associated with industrial, hazardous and hospital waste, as sufficient data were unavailable. Similarly, cost assessment of degradation associated with inadequately treated wastewater is limited due to data constraints. 

Cost is also presented for a limited number of remedial actions in each of the environmental areas for which damage cost is estimated. More detailed analysis is required in future work in order to compare benefits of remediation to reduction in damage cost at the margin.