Pollution is emerging as the greatest water-related threat to the economy. The economic model developed for this study suggests that the main threat is the impact of water pollution on human health, which could reduce GDP by 3.5 percent by 2035.
A much smaller impact (0.8 percent) could come from the effects of declining water quality on paddy yields. The model did not quantify the economic consequences of other forms of water pollution, including the salinization of surface water and groundwater supplies.
Rapid urban development has led to rising water pollution. Urban and industrial wastewater is the largest contributor to water pollution. Only 46% of urban households have connections to drainage systems and only 12.5% of municipal wastewater is treated.
Over the next 15 years, urban wastewater is expected to account for the largest share of effluents (about 60 percent). Industrial wastewater will account for 25–28 percent and rural wastewater for 12–15 percent.
Much industrial wastewater is discharged without pretreatment. It is estimated that at the end of 2018, centralized wastewater treatment plants were treating only about 71% of industrial wastewater (Thoi Bao Tai Chinh 2018).
Agriculture produces vast quantities of waste from fertilizers, pathogens, and pharmaceuticals fed to animals. About 80 million of the estimated 84 million tons of livestock waste generated each year enter the environment untreated, carrying nutrients, pathogens, and volatile compounds that compromise water and air quality and damage soils (Nguyen The Hinh 2017).
With crop farming intensifying, pollution from fertilizers and pesticides has also surged. There is scant monitoring but strong global evidence of the harmful effects of pollution on health and productivity. Aquaculture, a key export industry, is also highly polluting. Neither regulation nor food safety concerns seem able to halt the toxic waste flowing from aquaculture farms.
The costs of this water pollution are high. Due to economic activities, in no river basin does surface water meet the organic pollution standards for drinking water established by the World Health Organization. Waterways flowing past major cities, such as the To Lich, Set and Kim Nguu Rivers passing through Hanoi, are seriously polluted—a wasted resource and a risk to human health and natural ecosystems.
High pollution levels also constrain urban development and the sustainability and future growth of industry and agriculture. It will cost Vietnam around US$12.4 – US$18.6 million a day by 2030 if treatment measures are not put in place by then. In Vietnam’s southern key economic zones, the cost estimate for 2010 was US$867 million.
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