Select Committee on International Development Minutes of Evidence

Memorandum submitted by UNAIDS


  1.1  The International Development Committee of the United Kingdom House of Commons has asked UNAIDS to contribute written evidence on the impact of HIV/AIDS on developing countries' social and economic development. This paper has been prepared as complementary to the memorandum already submitted by DFID.

  1.2  This document provides a statistical overview and a narrative epidemiological summary. Part 4 then traces the impact on developing countries with regard to the effects on the workforce, on the national economy, on individual households, on governments' budgets, on the achievement of international development targets and on political and social stability. Part 5 traces the response to HIV/AIDS by the private sector and the international community. Finally, part 6 identifies some keys to success in responding to the epidemic. Much of the information is taken from UNAIDS' recently published Durban Report, which is submitted to the Committee as part of UNAIDS' written evidence.

  1.3  In discussing these issues, this document conveys the seriousness of the epidemic, but also stresses the need to keep hope alive. The evidence demonstrates that we are not powerless against the epidemic, but that our response needs to be scaled up by a significant order of magnitude.


2.1  Global estimates of the HIV/AIDS epidemic as of the end of 1999

  People newly infected with HIV in 1999: 5.4 million

  Adults 4.7 million

  Women 2.3 million

  Children <15 years 620,000

  Number of people living with HIV/AIDS: 34.3 million

  Adults 33.0 million

  Women 15.7 million

  Children <15 years 1.3 million

  AIDS deaths in 1999: 2.8 million

  Adults 2.3 million

  Women 1.2 million

  Children <15 years 500,000

  Total number of AIDS deaths since the beginning of the epidemic: 18.8 million

  Adults 15.0 million

  Women 7.7 million

  Children <15 years 3.8 million

  Total number of AIDS orphans since the beginning of the epidemic: 13.2 million

2.2   Adults and children living with HIV/AIDS according to regions

    —  Latin America 1.3 million

    —  Caribbean 360,000

    —  North America 900,000

    —  Western Europe 520,000

    —  North Africa and Middle East 220,000

    —  sub-Saharan Africa 24.5 million

    —  South and South-East Asia 5.6 million

    —  East Asia and Pacific 530,000

    —  Eastern Europe and Central Asia 420,000

    —  Australia and New Zealand 15,000


  3.1  Already 18.8 million people around the world have died of AIDS, 3.8 million of them children. Nearly twice that many—34.3 million—are now living with HIV, the virus that causes AIDS. Barring a miracle, most of these will die over the next decade or so. The most recent UNAIDS/WHO estimates show that, in 1999 alone, 5.3 million people were newly infected with HIV.

  3.2  The impact of AIDS continues to be felt mostly in the developing world, with about 95 per cent of the global total of people living with HIV. That proportion is set to grow even further as infection rates continue to rise in countries where poverty, poor health systems and limited resources for prevention and care fuel the spread of the virus. Hence, the huge gap in HIV infection rates and AIDS deaths between rich and poor countries is likely to grow even larger in the next century.


  3.3  Sub-Saharan Africa is the area of the world worst affected, with some 23.3 million estimated by UNAIDS/WHO to have HIV infection or AIDS. Not only are infection levels highest, but access to care is also lowest, and social and economic safety nets that might help families cope with the impact of the epidemic are badly frayed, in part because of the epidemic itself. Many African nations were evaluated downwards in this year's Human Development Index, a ranking published by the United Nations Development Programme (UNDP) to reflect health, wealth and education. Almost all of the major downward changes in rank could be ascribed to declining life expectancy—the direct result of AIDS. AIDS is now the leading killer in sub-Saharan Africa. In 1998 in Africa, where 200,000 people died as a result of conflict of war, AIDS killed 2.2 million people. Life expectancy at birth in southern Africa, which rose from 44 years in the early 1950s to 59 in the early 1990s, is set to drop to just 45 between 2005 and 2010 because of AIDS.

Latin America and the Caribbean

  3.4  Some Latin American countries, most notably Brazil, have expanded efforts to provide treatment to those infected. However, there is evidence that infections are on the rise in Central America and in the Caribbean basin, which has some of the highest infection rates outside Africa. The epidemic is driven by the combination of early sexual activity and high levels of partner exchange between young people. In Guatemala in 1999, some 2-4 per cent of pregnant women tested at antenatal clinics in major urban areas were found to have HIV. In Guyana, HIV prevalence was recorded at 3.2 per cent among blood donors—who are generally thought to represent a population at low risk of infection—while surveillance among urban sex workers in 1997 showed 46 per cent were infected. The last time Haiti carried out HIV surveillance among pregnant women, in 1996, close to 6 per cent tested positive for the virus. Altogether, UNAIDS/WHO estimate that some 1.7 million people in Latin America and the Caribbean will enter the 21st century with HIV infection—almost 30,000 of them children.


  3.5  In Asia, the pattern of HIV infection is lower relative to Africa. However, because of the large population sizes that exist for example in China and India, prevalence rates translate into large absolute numbers. Across the continent as a whole, UNAIDS/WHO estimate that 6.5 million people were living with HIV by the end of 1999, over five times as many as have already died of AIDS in the region. In some countries such as Thailand and the Philippines, strong prevention programmes have reduced HIV risk and lowered or stabilized HIV rates. Other countries have raised warning flags after collecting new information showing that injecting drug use is spreading and that condom use is uncommon, including among clients of sex workers and men who have sex with men. India has recently made a major effort to improve its understanding of the HIV epidemic and new results of surveillance reveal a very varied picture. In some states, principally in the south and west of the country, HIV has a significant grip on the urban population, with more than 2 per cent of pregnant women testing positive for HIV. In the north-east, HIV infection has moved rapidly through networks of men who inject drugs and has spread to their wives. Other states of India detected their very first HIV infections only in the last year or two.

Central and Eastern Europe

  3.6  HIV infections in the former Soviet Union have doubled in just two years. In the larger region comprising the former USSR as well as the remainder of Central and Eastern Europe, UNAIDS/WHO estimate that the number of infected people rose by a third over the course of 1999, reaching a total of 360,000. The world's steepest HIV incidence curve in 1999 was recorded in the newly independent states of the former Soviet Union, where the proportion of the population living with HIV doubled between end-1997 and end-1999. The bulk of new HIV infections were caused by unsafe injection of drugs and occurred in two countries, the Russian Federation and Ukraine. As the head of the Russian Federal AIDS Prevention Center announced recently, the true number of HIV cases in Russia may reach 300,000 or 400,000 in 2000 and about 1 million cases by 2005.




  4.1.1  The size of the labour force in high prevalence countries in the year 2020 is estimated to be about 10 to 22 per cent smaller than it would have been if there had been no HIV/AIDS. The labour force is still expected to continue growing. But because of the increased mortality, there will be about 11.5 million fewer persons in the labour force, without even considering the impact on economic growth of absenteeism, productivity decline and morbidity. In the case of the lower prevalence countries, the impact is significant but smaller. The labour force is expected to be between 3 and 9 per cent smaller (except for Thailand, where the difference is just over 1 per cent) than it would have been without HIV/AIDS, and the total labour force will grow by about 12.5 million fewer persons over the 35 year period.


  4.1.2  Labour force projections also provide some indication of the lowering of the average age of the labour force due to the impact of HIV/AIDS. Even assuming the same labour force participation rates, the median age of the labour force in high prevalence countries would be reduced by as much as two years by the year 2020, implying an increasing proportion of younger age groups in the labour force. The age and sex distribution of the labour force will change due to the rising number of widows and orphans seeking a livelihood and the large proportion of people with AIDS in the age group 20-49 years, resulting in the early entry of children into the active labour force, the early withdrawal of people with AIDS and the retention of older persons in the labour force due to economic need.


  4.1.3  Little is known of the impact of HIV/AIDS on the quality of the labour force in terms of education, training and experience. However, it is probable that HIV/AIDS will have a severe impact on these factors, particularly in view of the effect of HIV/AIDS on the education sector, in some countries, where it is reducing the number of qualified teachers and leading to a rise in early school drop-out rates for students whose parents die of AIDS. HIV/AIDS is therefore likely to have profound effects, not only on the size, but also on the composition and quality of the labour force in high prevalence countries.

Human resources and labour requirements

  4.1.4  In view of the expected impact of HIV/AIDS on the composition of the available workforce, there is likely to be a mismatch of human resources and labour requirements in terms of qualifications, training and experience. This means that those employees who have to leave the labour force can often not be replaced without loss of productivity.


Macroeconomic impact

  4.2.1  There are several mechanisms by which HIV/AIDS affects macroeconomic performance:

    AIDS deaths lead directly to a reduction in the number of workers available, and particularly workers in their most productive years. As experienced workers are replaced by younger, less experienced persons, productivity is reduced.

    —  A shortage of skilled workers leads to higher production costs and a loss of international competitiveness.

    —  Lower government revenues and reduced private savings (because of greater health care costs and a loss of income for workers) can lead to slower employment creation in the formal sector, which is particularly capital intensive. As a result, some workers will be pushed into lower paying jobs in the informal sector.

    —  Lower savings rates and less disposable income reduce the market size for business, particularly in markets outside of the basic necessities of food, housing, and energy, and reduce total resources available for production and investment, thus declining economic growth.

    —  Expenditure increases on the monitoring of high-risk groups, the establishment of prevention strategies, the provision of health care and welfare.

    —  Pressure increases on the social security system, including life insurance and pension funds, which are important sources of capital for both the Government and the private sector.

  4.2.2  The macroeconomic impacts of HIV/AIDS are sensitive to assumptions about how AIDS affects savings and investment rates, and whether AIDS affects the best-educated employees more than others. Studies in Tanzania, Cameroon, Zambia, Swaziland, Kenya and other sub-Saharan African countries have found that the rate of economic growth may be reduced by as much as 25 per cent over a 20-year period as a result of the HIV/AIDS pandemic. Early results of ongoing estimates by the World Bank suggest that the macroeconomic impact of HIV/AIDS may be significant enough to reduce the growth of national income by up to a third in countries with adult prevalence over 10 per cent.

Vulnerable economic sectors

  4.2.3  A number of economic sectors are particularly vulnerable to the impact of HIV/AIDS. These sectors are characterized by the requirement for workers to stay away from their homes for long periods, and include the transport, mining and fishing sectors. Sectors which rely on seasonal and short-term workers, such as agriculture, construction and tourism, are also particularly vulnerable to the impact of HIV/AIDS. Moreover, sectors which rely on highly trained personnel are also in danger of being adversely affected by HIV/AIDS because the loss of even a small number of specialists can place entire systems and significant investments at risk.

Costs and revenues

  4.2.4  AIDS-related illnesses and deaths of workers affect the economy both by increasing costs and reducing revenues. Employers have to spend more in areas such as health care, burial, training and recruitment of replacement employees. Revenues may be decreased because of absenteeism due to illness or attendance at funerals, as well as time spent on training. Labour turnover can lead to a less experienced and therefore less productive workforce. However, the relationship between HIV/AIDS and the costs and revenue of employers has rarely been examined systematically up to now. Moreover, little data is available on how HIV/AIDS affects micro and small formal and informal enterprises. Overall there is bound to be a reduction in profits if companies do not take early measures to prevent the impact of HIV/AIDS.

Rural sector

  4.2.5  In the rural sector, losses due to HIV/AIDS have led to reduced food production and declining food security, as well as a reallocation of labour and time from agricultural work to non-agricultural care activities. For example, according to a study by the Zimbabwe Farmers Union, the AIDS-related reduction in the production of maize has reached 61 per cent, cotton 47 per cent, vegetables 49 per cent and groundnuts 37 per cent. Agriculture is the largest sector in most African economies, accounting for a large proportion of production and a majority of employment. Studies carried out in Tanzania and other countries have shown that AIDS will have adverse effects on agriculture, including loss of labour supply and remittance income. The loss of a few workers at crucial periods of planting and harvesting can significantly reduce the size of the harvest. In countries where food security is an important issue because of drought, the decline in household production can have serious consequences. A loss of agricultural labour also causes farmers to switch to less labour-intensive crops. In many cases, this means switching from export crops to food crops, thereby affecting rural economies.


Effect on households

  4.3.1  The few surveys of the impact of having a family member with AIDS show that households suffer a dramatic decrease in income. Decreased income inevitably means fewer purchases and diminishing savings. In a study in Thailand, one-third of rural families affected by AIDS experienced a halving of their agriculture output, which threatened their food security. Another 15 per cent had to take their children out of school, and over half of the elderly people were left to take care of themselves. In urban areas in Côte d'Ivoire, the outlay on school education was halved, food consumption went down 41 per cent per capita, and expenditure on health care more than quadrupled. When family members in urban areas fall ill, they often return to their villages to be cared for by their families, thus adding to the call on scarce resources and increasing the probability that a spouse or others in the rural community will be infected.

  4.3.2  Families make great sacrifices to provide treatment, relief and comfort for a sick breadwinner. In the Thai study, the families spent on average US$1000 during the last year of an AIDS patient's life—the equivalent of an average annual income.

  4.3.3  A common strategy in AIDS-affected households is to send one or more children away to extended family members to ensure that they are fed and cared for. Such extended family structures have been able to absorb some of the stress of increasing numbers of orphans, particularly in Africa. However, urbanization and migration for labour, often across borders, are destroying those structures.


  4.3.4  So far, the AIDS epidemic has left behind 13.2 million orphans—children who, before the age of 15, lost either their mother or both parents to AIDS. Many of these children have died, but many more survive, not only in Africa (where 95 per cent currently live) but in developing countries throughout Asia and the Americas.Before AIDS, about 2 per cent of all children in developing countries were orphans. By 1997, the proportion of children with one or both parents dead had skyrocketed to 7 per cent in many African countries and in some cases reached an astounding 11 per cent.

  4.3.5  In African countries that have had long, severe epidemics, AIDS is generating orphans so quickly that family structures can no longer cope. Traditional safety nets are unravelling as more young adults die of this disease. Families and communities can barely fend for themselves, let alone take care of orphans. Typically, half of all people with HIV become infected before they turn 25, acquiring AIDS and dying by the time they turn 35, leaving behind a generation of children to be raised by their grandparents or left on their own in child-headed households.

  4.3.6  Wherever they turn, children who have lost a mother or both parents to AIDS face a future even more difficult than that of other orphans. According to a report published jointly in 1999 by UNICEF and the UNAIDS Secretariat, AIDS orphans are at greater risk of malnutrition, illness, abuse and sexual exploitation than children orphaned by other causes. They must also grapple with the stigma and discrimination so often associated with AIDS, which can even deprive them of basic social services and education.


Budgets under pressure

  4.4.1  Pressure is put on the governments' budgetary situation from two sides. On the one hand, expenditures for health care costs, pensions, sickness benefits, and social assistance are increasing due to HIV/AIDS. On the other hand, income is reduced through a lower size of the working age population, lower employment levels, reduced productivity and a loss of economic growth. As a consequence, there is a contraction of the contributory base, which leads to lower contributions and taxes.

Health Sector

  4.4.2  As a consequence of the growing number of infections, the epidemic's impact on the health sector over the coming decade will be predictably greater than in the past two decades combined. Already, however, the increased demand for health care from people with HIV-related illnesses is heavily taxing the overstretched public health services of many developing countries. In the mid-1990s, it was estimated that treatment for people with HIV consumed 66 per cent of public health spending in Rwanda and over a quarter of health expenditures in Zimbabwe. A recent study estimates that in 1997, public health spending for AIDS alone already exceeded 2 per cent of gross domestic product (GDP) in 7 of 16 African countries sampled—a staggering figure in countries where total health spending accounts for 3-5 per cent of GDP. In recent years, HIV-positive patients have occupied half of the beds in the Provincial Hospital in Chiang Mai, Thailand, 39 per cent of the beds in Kenyatta National in Nairobi, Kenya, and 70 per cent of the beds in the Prince Regent Hospital in Bujumbura, Burundi. A related impact of the epidemic is that patients suffering from other conditions are being crowded out. The hospital sector in Kenya has seen increased mortality among HIV-negative patients, who are being admitted at later stages of illness.

  4.4.3  The shifting and growing demand on health care systems is underscored by the exploding tuberculosis epidemic in the countries most heavily affected by HIV. As HIV weakens people's immune systems it makes them far more vulnerable to developing active tuberculosis. Tuberculosis has become the leading cause of death among people with HIV infection, accounting for about a third of AIDS deaths worldwide. Hospital data from Africa show that up to 40 per cent of HIV-infected patients have active tuberculosis. With a greater number of HIV-positive people developing active tuberculosis, there is also a greater risk that the TB bacillus will pass to others in the community. The World Bank has estimated that 25 per cent of HIV-negative persons dying of tuberculosis in the coming years would not have been infected with the bacillus in the absence of the HIV epidemic. Each of these new tuberculosis infections represents a further cost to the health sector.

  4.4.4  The development of new therapies for HIV-infected persons and of vaccines will further raise health sector costs in infrastructure, drugs, training, and personnel expenditures. As in other sectors of the economy, rising rates of HIV infection in health care workers will increase rates of absenteeism, reduce productivity, and lead to higher levels of spending for treatment, death benefits, additional staff recruitment and training of new health personnel.


  4.5.1  As the DFID memorandum points out, there has been little work so far to link epidemiological data directly to the impact of HIV/AIDS on the achievement of international development targets. Nevertheless, it is clear that the epidemic has an effect on all these targets, as it impacts on all areas of social and economic development in affected countries.

Poverty reduction

  4.5.2  We can assume that the goal of halving the number of persons living in extreme poverty between 1990 and 2015 will not be met in the worst affected countries due to the impact of HIV/AIDS. As the UN Secretary-General states in his recent Millennium Report, "our only hope of significantly reducing poverty is to achieve sustained and broad-based income growth". Yet, the negative impacts of HIV/AIDS on the labour force, on macroeconomic performance and on households (all discussed above) severely jeopardize income growth.

Child mortality reduction

  4.5.3  The goal of reducing infant and child mortality rates by two-thirds between 1990 and 2015 is also threatened by the epidemic. The expectation of life at birth in some of the 29 countries most affected in Africa has declined by seven years on average, and by as much as 20 years in the most severe cases (see Figure 1).

Figure 1:

  Child mortality, especially under the age of two, has increased by up to five fold over recent years. Studies done in Zambia, Kenya and Cameroon revealed a decrease in under-5 child mortality achieved by all three countries between 1981 and 1986 and a subsequent upturn, which has been attributed to AIDS (see Figure 2). Almost all AIDS deaths in young children can be traced back to mother-to-child transmission of the virus. This is why countries such as Zambia and Kenya, with their high adult HIV prevalence rates, have seen a particularly steep rise in child mortality.

Figure 2: Child Mortality in Zambia, Kenya and Cameroon


  4.5.4  In the worst affected countries, the epidemic also hinders the achievement of free and universal primary education by 2015. In areas where HIV infection is common, HIV-related illness is taking its toll on education in a number of ways. Firstly, it is eroding the supply of teachers and thus increasing class sizes, which is likely to dent the quality of education. Secondly, it is eating into family budgets, reducing the money available for school fees and increasing the pressure on children to drop out of school and marry or enter the workforce. Thirdly, it is adding to the pool of children who are growing up without the support of their parents, which may affect their ability to stay in school.

  4.5.5  Skilled teachers are a precious commodity in all countries, but in some parts of the world, teachers become too sick to work or die of HIV-related illness long before retirement. The Central African Republic, where around one in every seven adults is estimated to be infected with HIV, already has a third fewer primary school teachers than it needs. A recent study of the impact of HIV on the educational sector showed that almost as many teachers died as retired between 1996 and 1998. Of those who died, some 85 per cent were HIV-positive, and they died an average of 10 years before reaching the minimum retirement age of 52. The study recorded that 107 schools had closed owing to staff shortages, and only 66 remained open. With the teacher shortage expected to worsen, researchers calculate that over 71,000 children aged 6-11 will be deprived of a primary education by the year 2005. A similarly dramatic impact has been found in Côte d'Ivoire, where teachers with HIV miss up to six months of classes before dying (compared with 10 days missed by teachers dying of other causes) and where confirmed cases of HIV/AIDS account for seven out of ten deaths among teachers.

  4.5.6  AIDS may also aggravate the existing disparity in educational access between town and countryside. In a national survey of 6-15-year-olds in Zambia in 1996, over 70 per cent of those living in cities were enrolled in school, compared with just over half of those in rural areas. Rural postings are already unpopular among teachers in many countries, and the Zambian study suggested that the need to be close to a source of health care—a town or city—acted as an extra disincentive to teachers to go to rural areas.

  4.5.7  It is commonly assumed that children drop out of school when their parents die, whether of AIDS or another cause. While there has been little rigorous research, a few studies can point to AIDS in the family as a direct cause for school drop-out. For example, in a study of commercial farms in Zimbabwe, where most farmworker deaths are attributed to AIDS, 48 per cent of the orphans of primary-school age who were interviewed had dropped out of school, usually at the time of their parent's illness or death, and not one orphan of secondary-school age was still in school. Information collected in large household surveys representative of the general population confirms the general assumption that children whose parents have both died are less likely to be in school than children who are living with one or both parents.

Gender equality

  4.5.8  The fact that increasing economic pressure tend to make poor families take their daughters out of school rather than their sons—because in many cases the value of girls' labour exceeds the returns that parents expect from educating their daughters—impedes the goal of making progress towards gender equality through education. This tendency is exacerbated by AIDS, as girls are seen to have a high capability of providing care to infected family members at home.

  4.5.9  Moreover, while women of all ages are more likely than men to become infected with HIV during unprotected vaginal intercourse, this vulnerability is especially marked in girls whose genital tract is still not fully mature. Compounding their biological vulnerability, women and young girls often have a lower status in society at large and in sexual relationships in particular. It is the interplay of biological, cultural and economic factors that makes young girls particularly vulnerable to the sexual transmission of HIV. While both girls and boys engage in consensual sex, girls are more likely than boys to be uninformed about including their own biological vulnerability to infection if they start having sex very young. Girls are also far more likely than boys to be coerced or raped or to be enticed into sex by someone older, stronger or richer. Sometimes the power held over them is mainly that of greater physical strength. Sometimes it is social pressure to acquiesce to elders. Sometimes it is a combination of factors, as may be the case with older men who offer schoolgirls gifts or money for school fees in return for sex. In the era of AIDS, the consequences for young girls can be disastrous.

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