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PSI

When we think about global development challenges, sanitation rarely makes the headlines. Yet, it is one of the most transformative investments a country can make—not just for health, but for economic growth, social progress, and environmental sustainability. Some argue that sanitation is more an economic issue than a health issue. Our experience supporting market-based sanitation activities suggests this is true. When sanitation markets thrive, new products and innovations enter the market, jobs are created, supply chains expand, and governments invest. The ripple effect is enormous. 

Article written by

Dain Hansen leads global government affairs and policy for The IAPMO Group, representing the organization before the U.S. Congress, White House, regulatory bodies, and international partners. With over 15 years in the role, he drives policy engagement across water, building safety, and sustainability sectors.

John Sauer Deputy Director, WASH

PSI - Population Services International , United States

John Sauer is a Deputy Director for PSI’s water, sanitation, and hygiene (WASH) programs, where he drives market systems development initiatives that expand sustainable access to essential products and services for underserved communities. 

Susan Davis

Philanthropy Advisor and Global WASH Professional, United States

Susan is a social impact strategist with 30+ years of global experience. From founding roles to advising hundreds of donors, she brings unmatched insight into effective, locally-led philanthropy. 

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Reading Time: 8 min.

Sanitation: An Economic Engine 

Improving sanitation is not just about building toilets—it’s about building economies. Here’s why: 

  • Lower Health Care Costs: Poor sanitation is linked to diseases like cholera, typhoid, and dysentery. Treating these illnesses drains health budgets and household incomes. Every dollar invested in sanitation can save multiple dollars in health care costs. The World Bank and WHO have reported substantial economic benefits from Ethiopia’s investments in sanitation, linking them directly to decreased healthcare costs and reduced disease burden. 
  • Boosting Productivity: Illness reduces workforce productivity. Healthy workers mean fewer sick days and higher output, which translates into stronger economic performance. Brazil implemented comprehensive sanitation programs targeting urban areas, increasing productivity by 15% due to fewer sick days and better overall health. 
  • Driving Tourism and Investment: Tourists and investors avoid regions plagued by poor sanitation. Clean cities attract visitors, businesses, and global capital. Thailand for example, went from less than 1% of the rural population having toilets to 99% of the country having at least basic sanitation today. Tourism followed: in 2024, 32 million tourists spent $43 billion.  
  • Reducing Poverty and Raising GDP: Sanitation improvements lift households out of poverty by reducing medical expenses and enabling better education and work opportunities. Countries with strong sanitation systems see measurable GDP growth. Singapore is a shining example. In the 1960s, about half the population depended on night-soil pails. Now it thrives using a combination of high-tech, low-energy sewerage, wastewater reuse, and separate stormwater management. Today, Singapore’s GDP of $565 billion, making it one of the most developed and high-income economies in the world. 

 

The economic case is clear: sanitation is not a cost—it’s an investment with high returns. 

A Look Back: How Sanitation Transformed the U.S. 

It’s hard to imagine today, but even in the early 1900s, most homes in the United States did not have indoor plumbing. The first sewers in Brooklyn and Chicago weren’t built until the 1850s, and indoor plumbing didn’t become the norm until the mid-20th century. What drove this transformation? 

  • Technological Innovations: The flush toilet revolutionized hygiene and convenience. 
  • Public Health Campaigns: Outbreaks of cholera, typhoid, polio, and dysentery forced cities to act. 
  • Industry Advocacy: Campaigns like “a bath a day” promoted cleanliness as a desirable lifestyle. 
  • Infrastructure Development: Cities invested in sewer systems and water utilities. 
  • Media Influence: Newspapers published daily death tolls from disease outbreaks, creating urgency. Magazines like Good Housekeeping and Ladies’ Home Journal glamorized modern bathrooms, making indoor plumbing aspirational. 
  • Corporate Advertising: Brands like Kohler and American Standard marketed stylish fixtures, turning bathrooms into status symbols. 
  • Post-War Housing Boom: The GI Bill and mass housing developments after World War II accelerated adoption. 

 

This mix of technology, policy, marketing, and cultural change created a sanitation revolution in the U.S. The result? Dramatic improvements in public health, life expectancy, and economic growth. 

The Global Sanitation Gap 

Fast forward to today: more than 3 billion people still lack access to basic sanitation. That’s nearly 40% of the world’s population living without indoor plumbing—a reality that perpetuates disease, poverty, and inequality. 

The question is: what will drive the next sanitation boom globally? 

Catalysts for Change 

The same forces that transformed sanitation in the U.S. can spark change worldwide: 

  • Innovation: Affordable, water-efficient toilets and decentralized waste treatment systems are game-changers. 
  • Public Health Imperatives: COVID-19 reminded the world of the link between hygiene and disease prevention. Governments are paying attention. 
  • Industry Leadership: Companies can shape consumer aspirations and create demand for modern sanitation solutions. 
  • Infrastructure Investment: Cities and utilities must prioritize sanitation in urban planning. 
  • Media and Marketing: Just as magazines once glamorized bathrooms, today’s influencers and campaigns can make sanitation aspirational. 
  • Global Development Programs: Multilateral agencies and donors are investing in sanitation as part of resilience, infrastructure development, and health strategies. 

 

The Economic Opportunity 

Improving sanitation is not charity—it’s smart economics. Consider Africa: efforts to improve sanitation could create 500,000 jobs across construction, manufacturing, maintenance, and service sectors. These jobs stimulate local economies and build skills for the future. 

For U.S. companies, the opportunity is equally compelling. Many American firms specialize in engineering, equipment, and water management expertise. Global sanitation initiatives open markets for these capabilities, creating export opportunities and strengthening U.S. leadership in sustainable development. 

Water and Wastewater utilities in the U.S. can also play a pivotal role. Knowledge transfer from mature systems to emerging utilities can accelerate progress in countries where water and sanitation services are just taking root. This is not only good for global health—it is good for business and diplomacy. 

Why Now? 

The timing could not be better. Urbanization is accelerating, water systems are stressed, and global health priorities are shifting toward prevention. Sanitation sits at the intersection of these trends. Investing now means avoiding future crises, unlocking economic potential, and improving quality of life for billions. 

A Call to Action 

The world needs a sanitation boom—a movement as transformative as the one that reshaped the U.S. a century ago. Governments, businesses, and civil society must work together to: 

  • Invest in Infrastructure: Build systems that are resilient, inclusive, and sustainable. 
  • Support Market-Based Solutions: Empower entrepreneurs and local businesses to deliver affordable sanitation products and services. 
  • Promote Behavior Change: Make sanitation aspirational through education and marketing. 
  • Leverage Technology: Innovate for efficiency, affordability, and environmental impact. 
  • Foster Partnerships: Connect utilities, companies, and governments to share expertise and resources. 

 

Sanitation is not just about toilets—it’s about dignity, health, and prosperity. It’s time to treat it as the economic engine it truly is. Imagine a world where every household has access to safe, modern sanitation. Fewer children die from preventable diseases. Women and girls no longer risk safety for lack of facilities. Economies grow stronger, and communities thrive. This future is possible—but only if we act now. 

The sanitation boom is not a dream. It’s a necessity. And it’s within our reach. Learn more about our approach to powering safe sanitation here.


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