The Economic Impact of the Hiv/Aids Pandemic

The Economic Impact of the HIV/AIDS Pandemic

Karen A. Feins

Principles of Microeconomics

ECO204

Instructor: Sheila Roberts-Phipps

March 08, 2010

The Economic Impact of the HIV/AIDS Pandemic

In sub-Saharan Africa, considered a Fourth World Country (Case, et. al. Pg. 426), the HIV/AIDS pandemic has infected more than 40 million worldwide and it is estimated that 22.4 million people are living with HIV/AIDS in Africa; this is about two thirds of the global population. In 2008, it was reported that of those 22 million, approximately 1.4 million died from AIDS while an additional 1.9 million were newly diagnosed (2009 UN Aids Report. http://data.unaids.org). This pandemic is not just a health crisis but has terrible economic consequences for the continent and ultimately for the world (Case, et. al. (2009). Pg. 5). The result of this pandemic has resulted in an economic instability in this region ultimately causing them to stagnate and fall behind in economic advances compared to the rest of the world.

HIV/AIDS affects all social and economic groups in the sub-Sahara Africa. The economic impact of this pandemic spreads across many sectors such as health care, household, education, and labor. Although there has been a slight decline in the rate of prevalence in the last decade there are several countries that HIV/AIDS is more prevalent and the impact is greater. The Central African Republic, South Africa, Mozambique, Namibia, Zambia, and Zimbabwe report that approximately 15-20% of adults in these countries are infected with HIV. However, the prevalence rate is greatest in countries such as Botswana (24.1%), Lesotho (23.2%), and Swaziland (33.4%) where HIV has exceeded 20% (http://www-wds.worldbank.org).

The impact of the epidemic on the healthcare workforce include erosion due to illness and death, absenteeism, low morale, increased demand for provider time and skills, diversion of resources, budgetary and managerial inadequacies,...