Market Failure of the Brick Making Industry in Bangladesh
Brick-Making Industry
An Analysis on Market Failure
Table of Contents Brick Making Industry in Bangladesh 2 Undesired Current Status 3 Impacts of Brick Making Industry 4 Environmental Impacts 4 Social Impacts 5 Reforms and Developments 7 Implemented/In-process 7 Proposed Reforms 7 Aftermaths of Proposed Reforms 9 References 10
Brick Making Industry in Bangladesh
Present-day Status
Brick making is indispensable for the economy of Bangladesh. Though not formally recognized as an industry, brick-making is a significant economic activity in Bangladesh. The country’s overwhelming dependence on bricks is due to its lack of stones in any sizable quantity or other alternative building materials at comparable cost.
Snapshot of Bangladesh’s brick sector (2011): Parameter | Value | Estimated total number of coal-fired kilns | 5,000 | Number of natural gas fired kilns | 20 | Annual brick production | 17.2 billion | Value of output | TK83 billion (∼US$1.2 billion)* | Contribution to GDP | ~1% | Coal consumption | 3.5 million tons | Value of imported coal | TK22.6 billion (∼US$322 million) | Firewood consumption | 1.9 million tons | Emissions CO2 | 9.8 million tons | Clay consumption | 45 million tons | Total employment (incl. supply of clay and coal, transport of bricks) | ∼1 million people | Growth rate of the construction industry (1995-2005) | 5.6% | Estimated future growth rate of the brick sector over the next ten years | 2-3% |
Sources: BUET (2007), Gomes and Hossain (2003) and World Bank (2011b)
*Estimated at a per-brick price of TK5.5.
Undesired Current Status
Brick kilns in Bangladesh are mostly informal and small-scale operations. More than 90 percent of brick kiln owners are small-scale operators. Most FCKs are individually owned, with each owner possessing one kiln only. Multiple ownership of one kiln and multiple kilns under the same ownership are rare. In a few cases, established business houses own brick
An Analysis on Market Failure
Table of Contents Brick Making Industry in Bangladesh 2 Undesired Current Status 3 Impacts of Brick Making Industry 4 Environmental Impacts 4 Social Impacts 5 Reforms and Developments 7 Implemented/In-process 7 Proposed Reforms 7 Aftermaths of Proposed Reforms 9 References 10
Brick Making Industry in Bangladesh
Present-day Status
Brick making is indispensable for the economy of Bangladesh. Though not formally recognized as an industry, brick-making is a significant economic activity in Bangladesh. The country’s overwhelming dependence on bricks is due to its lack of stones in any sizable quantity or other alternative building materials at comparable cost.
Snapshot of Bangladesh’s brick sector (2011): Parameter | Value | Estimated total number of coal-fired kilns | 5,000 | Number of natural gas fired kilns | 20 | Annual brick production | 17.2 billion | Value of output | TK83 billion (∼US$1.2 billion)* | Contribution to GDP | ~1% | Coal consumption | 3.5 million tons | Value of imported coal | TK22.6 billion (∼US$322 million) | Firewood consumption | 1.9 million tons | Emissions CO2 | 9.8 million tons | Clay consumption | 45 million tons | Total employment (incl. supply of clay and coal, transport of bricks) | ∼1 million people | Growth rate of the construction industry (1995-2005) | 5.6% | Estimated future growth rate of the brick sector over the next ten years | 2-3% |
Sources: BUET (2007), Gomes and Hossain (2003) and World Bank (2011b)
*Estimated at a per-brick price of TK5.5.
Undesired Current Status
Brick kilns in Bangladesh are mostly informal and small-scale operations. More than 90 percent of brick kiln owners are small-scale operators. Most FCKs are individually owned, with each owner possessing one kiln only. Multiple ownership of one kiln and multiple kilns under the same ownership are rare. In a few cases, established business houses own brick
References: Department of Environment. 2010b. Social Interventions in Brick Kilns, Report Contract no:S03/2007-8. DOE. Bangladesh. Gomes, E. and I. Hossain. 2003. Transition from traditional brick manufacturing to more sustainable practices. Energy for Sustainable Development, Vol. VII, No. 2. P. 66-76. MoEP (Ministry of Environmental Protection of China). 2009. Emission Standard of Air Pollutants for the Brick and Tile Industry (Consultation draft). MoEP. Nordin, M., G.B.J. Andersson, M. H. Pope. 2006. Musculoskeletal Disorders in the Workplace: Principles and practice. Elsevier Health Sciences. 428 p. Ostro, B. 1994. Estimating the Health Effects of Air Pollution: A Method with an Application in Jakarta. Policy Research Working Paper 1301, World Bank, Washington, DC. Pope, C. A., R. T. Burnett, M. J. Thun, E. E. Calle, D. Krewski, K. Ito, and G. Thurston. 2002. Lung Cancer, Cardiopulmonary Mortality, and Long-Term Exposure to Fine Particulate Air Pollution. Journal of the American Medical Association 287 (9): 1132–41. World Bank. 2011b. Alternative cleaner brick making technologies. Proposed technology diversification program. BTOR. Internal document. World Bank.