HIVHuman immunodeficiency virus is a lentivirus that causes acquired immunodeficiency syndrome , a condition in humans in which the immune system begins to fail, leading to life-threatening opportunistic infections. Infection with HIV occurs by the transfer of blood, semen, vaginal fluid,...
and
AIDSAcquired immune deficiency syndrome or acquired immunodeficiency syndrome is a disease of the human immune system caused by the human immunodeficiency virus ....
affects
economic growthEconomic growth is a term used to indicate the increase of total GDP. It is often measured as the rate of change of gross domestic product . Economic growth refers only to the quantity of goods and services produced; it says nothing about the way in which they are produced...
by reducing the availability of
human capitalHuman capital refers to the stock of skills and knowledge embodied in the ability to perform labor so as to produce economic value. It is the skills and knowledge gained by a worker through education and experience...
. Without proper
nutritionNutrition is the provision, to cells and organisms, of the materials necessary to support life. Many common health problems can be prevented or alleviated with a healthy diet....
, health care and medicine that is available in developed countries, large numbers of people are falling victim to AIDS.
They will not only be unable to work, but will also require significant medical care. The forecast is that this will probably cause a collapse of economies and societies in countries with a significant AIDS population.
HIVHuman immunodeficiency virus is a lentivirus that causes acquired immunodeficiency syndrome , a condition in humans in which the immune system begins to fail, leading to life-threatening opportunistic infections. Infection with HIV occurs by the transfer of blood, semen, vaginal fluid,...
and
AIDSAcquired immune deficiency syndrome or acquired immunodeficiency syndrome is a disease of the human immune system caused by the human immunodeficiency virus ....
affects
economic growthEconomic growth is a term used to indicate the increase of total GDP. It is often measured as the rate of change of gross domestic product . Economic growth refers only to the quantity of goods and services produced; it says nothing about the way in which they are produced...
by reducing the availability of
human capitalHuman capital refers to the stock of skills and knowledge embodied in the ability to perform labor so as to produce economic value. It is the skills and knowledge gained by a worker through education and experience...
. Without proper
nutritionNutrition is the provision, to cells and organisms, of the materials necessary to support life. Many common health problems can be prevented or alleviated with a healthy diet....
, health care and medicine that is available in developed countries, large numbers of people are falling victim to AIDS.
They will not only be unable to work, but will also require significant medical care. The forecast is that this will probably cause a collapse of economies and societies in countries with a significant AIDS population. In some heavily infected areas, the epidemic has left behind many
orphanAn orphan is a child permanently bereaved of his or her parents. In common usage, only a child who has lost both parents is called an orphan....
s cared for by elderly
grandparentGrandparents are the father or mother of a person's own father or mother. Everyone has a maximum of four genetic grandparents, eight genetic great-grandparents, sixteen genetic great-great-grandparents, etc...
s.
The increased mortality in this region will result in a
smaller skilled populationPopulation decline is the reduction over time in a region's census. It can be caused for several reasons; notable ones include sub-replacement fertility , heavy emigration, disease, famine and war.Prior to the 20th century, population decline was mostly observed due to disease or starvation...
and
labor forceIn economics, the people in the labor force are the suppliers of labor. The labor force is all the nonmilitary people who are employed or unemployed...
. This smaller
labor forceIn economics, the people in the labor force are the suppliers of labor. The labor force is all the nonmilitary people who are employed or unemployed...
will be predominantly young people, with reduced knowledge and
work experienceWork experience is the experience that a person has working, or working in a specific field or occupation.- Volunteer work and internships :The phrase is sometimes used to mean a type of volunteer work that is commonly intended for young people — often students — to get a feel for...
leading to reduced productivity. An increase in workers’ time off to look after sick family members or for
sick leaveSick leave is an employee benefit in the form of paid leave, which workers can use during periods of temporary sickness or to stay home and address their health and safety needs without losing pay or their jobs. In some places of employment it is a workplace policy, and in many jurisdictions it is...
will also lower productivity. Increased mortality will also weaken the mechanisms that generate human capital and
investmentInvestment or investing is a term with several closely-related meanings in business management, finance and economics, related to saving or deferring consumption. Investing is the active redirection of resources: from being consumed today, to creating benefits in the future; the use of assets to...
in people, through loss of
incomeIncome is the consumption and savings opportunity gained by an entity within a specified time frame, which is generally expressed in monetary terms. However, for households and individuals, "income is the sum of all the wages, salaries, profits, interests payments, rents and other forms of earnings...
and the death of parents.
By killing off mainly young adults, AIDS seriously weakens the
taxTo tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law.Taxes are also imposed by many subnational entities...
able population, reducing the resources available for public expenditures such as education and health services not related to AIDS resulting in increasing pressure for the state's finances and slower growth of the economy. This results in a slower growth of the tax base, an effect that will be reinforced if there are growing expenditures on treating the sick, training (to replace sick workers), sick pay and caring for AIDS orphans. This is especially true if the sharp increase in adult mortality shifts the responsibility and blame from the family to the government in caring for these orphans.
On the level of the household, AIDS results in both the loss of income and increased spending on healthcare by the household. The income effects of this lead to spending reduction as well as a substitution effect away from education and towards healthcare and funeral spending. A study in
Côte d'Ivoire' , formerly named, and often referred to as the Ivory Coast, officially the ', is a country in West Africa. The government officially discourages the use of the name Ivory Coast in English, preferring the French name to be used in all languages.With an area of 322,462 km
2 Côte...
showed that households with an HIV/AIDS patient spent twice as much on medical expenses as other households.
With economic stimulus from the government, however, HIV/AIDS can be fought through the economy. With some money, HIV/AIDS patients will have to worry less about getting enough food and shelter and more about fighting their disease. However, if economic conditions aren't good, a person with HIV/AIDS may decide to become a sex trade worker to earn more money. As a result, more people become infected with HIV/AIDS.
UNAIDS, WHO and the
United Nations Development ProgrammeThe United Nations Development Programme is the United Nations' global development network. The UNDP is an executive board within the United Nations General Assembly...
have documented a correlation between the decreasing life expectancies and the lowering of gross national product in many African countries with prevalence rates of 10% or more. Indeed, since 1992 predictions that AIDS would slow
economic growthEconomic growth is a term used to indicate the increase of total GDP. It is often measured as the rate of change of gross domestic product . Economic growth refers only to the quantity of goods and services produced; it says nothing about the way in which they are produced...
in these countries have been published. The degree of impact depended on assumptions about the extent to which illness would be funded by savings and who would be infected.
Conclusions reached from models of the growth trajectories of 30 sub-Saharan economies over the period 1990–2025 were that the economic growth rates of these countries would be between 0.56 and 1.47% lower. The impact on
gross domestic productThe gross domestic product or gross domestic income is a basic measure of a country's economic performance and is the market value of all final goods and services made within the borders of a country in a year...
(GDP) per capita was less conclusive. However, in 2000, the rate of growth of Africa's per capita GDP was in fact reduced by 0.7% per year from 1990–1997 with a further 0.3% per year lower in countries also affected by
malariaMalaria is a vector-borne infectious disease caused by a eukaryotic protist of the genus Plasmodium. It is widespread in tropical and subtropical regions, including parts of the Americas, Asia, and Africa. Each year, there are approximately 350–500 million cases of malaria, killing between one and...
. The forecast now is that the growth of GDP for these countries will undergo a further reduction of between 0.5 and 2.6% per annum. However, these estimates may be an underestimate, as they do not look at the effects on output
per capitaPer capita is a term adapted from Latin phrase pro capite meaning "per head" with pro meaning "per" or "for each", and capite meaning "head." Both words together equate to the phrase "for each head."...
.
Many governments in sub-Saharan Africa denied that there was a problem for years, and are only now starting to work towards solutions. Underfunding is a problem in all areas of HIV prevention when compared to even conservative estimates of the problems.
Recent research by the
Overseas Development InstituteThe Overseas Development Institute is one of the leading independent think tanks on international development and humanitarian issues. Based in London, its mission is "to inspire and inform policy and practice which lead to the reduction of poverty, the alleviation of suffering and the achievement...
(ODI) has suggested that the private sector has begun to recognize the impact of HIV/AIDS on the bottom line, both directly and indirectly. It is estimated that a company can generate an average return of US$3 for every US$1 invested in employee health due to a reduced absenteeism, better productivity and reduction in employee turnover.
Indirectly there are also important implications on the
supply chainA supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to...
. Many multi-national corporations (MNCs) have therefore gotten involved in HIV/AIDS initiatives of three main types: a community-based partnerships, supply chain support, and sector-based initiatives.
The launching of the world's first official HIV/AIDS Toolkit in
ZimbabweZimbabwe , is a landlocked country located in the southern part of the continent of Africa, between the Zambezi and Limpopo rivers...
on October 3 2006 is a product of collaborative work between the
International Federation of Red Cross and Red Crescent SocietiesThe International Red Cross and Red Crescent Movement is an international humanitarian movement with approximately 97 million volunteers worldwide which started to protect human life and health, to ensure respect for the human being, and to prevent and alleviate human suffering, without any...
,
World Health OrganizationThe World Health Organization is a specialized agency of the United Nations that acts as a coordinating authority on international public health...
and the
Southern AfricaThe Republic of South Africa is a country located at the southern tip of Africa, with a coastline on the Atlantic and Indian Oceans. To the north lie Namibia, Botswana and Zimbabwe, to the east are Mozambique and Swaziland, while Lesotho is an independent country surrounded by South Africa.Modern...
HIV/AIDS Information Dissemination Service. It is for the strengthening of people living with HIV/AIDS and nurses by minimal external support. The package, which is in form of eight modules focusing on basic facts about HIV and AIDS, was pre-tested in Zimbabwe in March 2006 to determine its adaptability. It disposes, among other things, categorized guidelines on clinical management, education and counseling of AIDS victims at community level.
The
Copenhagen ConsensusCopenhagen Consensus is a project that seeks to establish priorities for advancing global welfare using methodologies based on the theory of welfare economics. It was conceived and organized by Bjørn Lomborg, the author of The Skeptical Environmentalist and the then director of the Danish...
is a project that seeks to establish priorities for advancing global welfare using methodologies based on the theory of
welfare economicsWelfare economics is a branch of economics that uses microeconomic techniques to simultaneously determine allocative efficiency within an economy and the income distribution associated with it. It analyzes social welfare, however measured, in terms of economic activities of the individuals that...
. The participants are all economists, with the focus of the project being a rational prioritization based on economic analysis. The project is based on the contention that, in spite of the billions of dollars spent on global challenges by the United Nations, the governments of wealthy nations, foundations, charities, and non-governmental organizations, the money spent on problems such as malnutrition and climate change is not sufficient to meet many internationally-agreed targets. The highest priority was assigned to implementing new measures to prevent the spread of HIV and AIDS. The economists estimated that an investment of $27 billion could avert nearly 30 million new infections by 2010.
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