Macroeconomics and AIDS (Trevor Neilson, Brian Brink)

8/7/2019 Macroeconomics and AIDS (Trevor Neilson, Brian Brink)

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Business and HIV/AIDS:Economic Impact and

Business Rationale

Trevor NeilsonExecutive Director,Global Business Coalition onHIV/AIDSJuly 8, 2004

Bangkok, Thailand


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The Global AIDS Crisis The worst health crisis in all of

human history

30 million people have died

40 million are currently infected

Infections are not slowing

Next wave countries: Russia,India, China

Limited access to treatment


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ew n ect ons n :million, over 13, 000 a

day More than 50% are women

About 50% are in the agebracket between 15-24 years

Almost 2000 are in childrenunder the age of 15

More than 95% are in low andmiddle income countries


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g an ow s ma es oCurrent and Future HIV/AIDS-Infected Adults in Next-Wave

Countries, 2002 and 2010

25

20

15

10

5

0

Millions

2002 2010

High

Low

Nigeria Ethiopia Russia India China

HighLow

2002 2010 2002 2010 2002 2010 2002 2010


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AIDS DecimatesEconomies

Growth Impact of HIV (1990-97) (80 developing countries)

-1.6

-1.4

-1.2

-1

-0.8

-0.6

-0.4

-0.2

0

0 5 10 15 20 25 30 35

HIV Prevalence Rate (%)

Reduction in growth rate GDP

per capita (%, per ye ar)

Source: R. Bonnel (2000) Economic Analysis ofHIV/AIDS, ADF2000 Background paper, World Bank.Slide adapted from UNAIDS: Socio-Economic Impact of HIV/AIDS in Africa, presented by AnitaAlban and Lorna Guiness, ADF 2000.


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Impact on EconomicDevelopment

Business Increased Cost, decreased revenue Decreased productivity, depleting skills and distorting labor market

Markets Reduced Consumer spending

Society

Health consumes more of government budget, leaving less for socialinvestment Families spend down savings, reducing capital Tax revenues fall Skilled workers & professionals die or may flee: brain drain Foreign investment and tourism decline Mass orphaning


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Security Threats of HIV/AIDS

Civil and international conflicts contribute to the spread of HIV/AIDS:

AIDS does not cause wars but it magnifies the impact of conflict

AIDS destabilizes governments

AIDS is increasing the risk profile for corporate and internationalinvestment

Some African armies have prevalence rates of 40-60%


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The Impact on

Businesses Employees in their most productive years are affected Increased cost for health care, burials, training and

recruitment of replacement employees

Decreased revenues as a result of absenteeism due toillness or attendance at funerals, as well as time spenton training

Labor turnover and loss of skilled workers can lead to

a less productive work force


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IncreasingVulnerability

Looking solely at direct costs underestimates thefull impact of HIV/AIDS In addition to measurable savings of $20K-200K for each

new infection prevented, DaimlerChrysler concludedthat prevention of a new infection averted a far greaterloss of human capital

Small and medium enterprises Potentially more vulnerable than MNCs Capture majority of the population

Limited resources and lack of awareness and access tohealth services Will require massive mobilization and support

Source: South African Business Coalition on HIV/AIDS and Bureaufor Economic research, 2003.


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What Can Business Do? The workplace is one of the best mechanisms to educate the

adult population and their communities about HIV Businesses can give resources or in-kind contributions and

use their products in innovative ways

Workplace health systems can be important for expandingaccess to treatment and prevention services

Business people can play leadership roles in theircommunities and urge governments to take action

Businesses can provide management expertise to HIV/AIDSorganizations


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Global Business Coalitionon HIV/AIDS

Over 150 Member Companies Richard Holbrooke, President and CEO Mark Moody-Stuart, Chairman Business AIDS Methodology Benefits of Membership Issue-based campaigns


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What do GBC

companies do? Use their products, people andreputation to fight AIDS Adopt AIDS policies and prevent and

treat within their workforce Every companies approach is different Examples: Anglo American, Viacom,

MAC, Getty Images


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Source: Adapted from WHO/UNAIDS Statistics, & HIV/AIDS Surveillance in

Europe, End- year report 2001, No. 66, CESES

2.5

2.0

1.5

1.0

0.5

0.0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001Yearly D

e aths as a Proport ion of 19 95 Values

HAART

AIDS deaths in Africa

AIDS deaths in Western Europe

Life

The widening gap between North andSouth


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Business, AIDS andPublic Policy

Accelerating Access to Testing 6 million people need ARVs only 400,000

have access to medicines

To fulfill WHO 3 by 5 goal5,000 people need to be brought onto treatmentevery day, which means500,000 people need to be tested every day

(assuming that 50,000 test positive and 10% of

those will need immediate access to treatment)Policy Shift on HIV/AIDS Testing


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Overcoming AIDS WhatMust Happen

Business is only one small piece of the pie:

In hard hit regions, national governments creatingeffective programs for their countrys HIV response iscritically important

In donor nations, mobilization of resources globally towardHIV prevention testing and treatment must be sustained

The general public must be educated about the need fornew resources


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The impact of AIDS on business and

Economic prosperity cannot be ignored.Our customers in many parts of the world and our own staff are threatened by theepidemic the day to day operations of

business could be compromised, we have tosolve this problem.

-- Mervyn Davies, Group Chief Executive,Standard Chartered Bank

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Macroeconomics and AIDS (Trevor Neilson, Brian Brink)

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