Environmental costs and benefits of road projects: an assessment in relation to project appraisal in Malaysia

In economic analysis of road projects in Malaysia, the environmental costs and benefits are usually neglected. This distorts the economic evaluation and produces inaccurate project feasibility numbers. One of the reasons for this has always been the difficulty in quantifying the environmental costs and benefits many of which can be subjective and value-laden. Research throughout the world and the improved understanding of many environmental issues have begun to demystify the environmental dimension and it is now possible to quantify some of these costs and benefits. Although large gaps remain in our knowledge of the related-sciences, we are now in a better position to consider the environmental dimension as a crucial component of project economic appraisal. These environmental costs and benefits must be incorporated into the project economic assessment so that the project evaluation is more realistic and better reflects the total costs and total benefits to the society as a whole.