Costs of environmental degradation An analysis in the Middle East and North Africa region Muawya Ahmed Hussein Dhofar University, Salalah, Dhofar, Oman 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 The current issue and full text archive of this journal is available at www.emeraldinsight.com/1477-7835.htm This paper was presented at the International Symposium on Drylands Ecology and Human Security (ISDEHS) Dubai, 4-7 December 2006. Costs of environmental degradation 305 Received 20 July 2007 Revised 25 October 2007 Accepted 30 November 2007 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