Economic impacts of large dams on downstream brickmaking in developing countries

Abstract

Large dams have positive and negative impacts, including disrupting brickmaking on the floodplains downstream due to flow regulation and sediment reduction, affecting the supply of essential construction material, notably in developing countries. In this study, we introduce an analytical framework to assess the economywide effects of large dams on downstream brickmaking, focusing on Traditional Fired Clay Brick (TFCB). The framework includes three steps: characterizing the impacts on river flow and sediment load using river system modeling and secondary data, understanding the role of TFCB production in the economy based on survey and economic data, and quantifying the economywide impacts of changes in TFCB production using dynamic computable general equilibrium modeling. We demonstrate the functionality of the approach by conducting a case study of the impacts of the Grand Ethiopian Renaissance Dam (GERD) on the Sudanese economy due to changes in TFCB production by comparing two scenarios: “with GERD” and “no GERD.” Results show that Sudan’s accumulated (2023–2050) discounted (at 0.5% annually) Gross Domestic Product (GDP) at factor cost would decline by US$ 6 billion (−0.38%) due to a reduction in TFCB production. Consumer flexibility regarding brick types and the ability of alternative brick sources to fill the demand gap are key determinants of the impacts.