The Links between AIDS and Poverty
An examination of the relationship between AIDS and poverty on the macro and micro levels, methods of poverty reduction, and debt relief as a solution to the AIDS-poverty dilemma.
Andrew R. Hsu
Ethics of Development in a Global Environment (E297C) – Professor Bruce Lusignan
Spring 2002-03 – Poverty and Prejudice
I Introduction
In recent years, the issue of AIDS and poverty has captured the attention of political leaders, the media, and governments around the world. In 2000, South African president Thabo Mbeki famously and controversially claimed that the problem of AIDS was essentially a problem of extreme poverty. Even earlier, Jonathan Mann, the founding director of the World Health Organization’s Global Program on AIDS claimed that, “[the] marginalized, stigmatized, and discriminated against…have later become, over time, those at highest risk of HIV infection.”[1] For the affected families and national policy-makers in many countries, the case is straightforward: AIDS is condemning millions to misery and poverty. To date, AIDS has left behind 13.2 million orphans – children who, before the age of 15, have 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% currently live, but also in developing countries throughout Asia and the Americas. In many African countries that have had long, severe epidemics, AIDS is generating orphans so fast that family structures can no longer cope.[2]
Despite the plethora of attention that the issue has received, the exact nature of the relationship between AIDS and poverty is still largely undetermined. The relationship between AIDS and poverty remains such a contentious issue because of the many conflicting studies as to whether poverty is a risk factor for AIDS, and conversely whether AIDS itself is immiserating. Without a doubt, AIDS is currently one of the biggest health threats in the world, and has even reached epidemic levels in certain developing countries. Therefore, it is critical to pinpoint all of the risk factors for AIDS, and if poverty is found to cause or increase the likelihood of contracting the disease, then focus must be redirected at solving the problem of AIDS through poverty reduction rather than just through medical intervention. This paper aims to clarify the complex relationship between AIDS and poverty by analyzing the linkage on a macro and micro level as well as examining poverty reduction techniques such as debt relief to solve the AIDS-poverty dilemma.
II AIDS and Poverty – Macro Analysis
On a macro level, AIDS threatens to wreak havoc on the already precarious position of the world’s poor. The most striking numbers are the simplest: 95% of those infected with HIV live in developing countries, home to around 80% of the world’s population and the vast majority of the world’s poor as well. Africa, which contains the largest share of poor countries in the world, has seen its life expectancies slashed dramatically by the virus. One example is Zimbabwe, which has already seen a 25-year decline in life expectancy because of the disease.[3] Overall, the life expectancy reductions caused by AIDS mean that many hard-hit African countries are unable to benefit from the increased income growth normally accompanying life expectancy improvements across the world.
In the early years of the HIV/AIDS epidemic, it seemed that AIDS primarily affected the wealthy and better educated. This could have been because people of higher socioeconomic status had greater access to commercial sex, and lived in countries with better infrastructures and more mobile populations. Surveys of sexual behavior sponsored by the World Health Organization’s Global Program on AIDS conducted in 1989-1991 showed that the probability of having a non-regular or commercial sexual partner rose with education, thus increasing exposure to HIV.[4],[5] Now, however, as the epidemic grows and matures, AIDS is becoming increasingly concentrated in poorer populations. The way in which AIDS moves from rich to poor populations is as follows: wealthy, mobile populations engaging in high-risk behavior for AIDS spread the disease back to a poorer population at their place of origin. However, while the wealthy learn to protect themselves, the poor remain vulnerable to the disease. In a later study of 15-19 year-olds in 17 African and four Latin American countries, UNAIDS confirmed earlier results by finding that better-educated people were still those most likely to engage in high-risk HIV activities. The study also found that the best-educated people in Africa’s worst afflicted countries were shifting towards less risky behavior over time.[6] This finding is similar to that documented in Brazil over the past two decades. In the early 1980s, three-quarters of people in Brazil newly diagnosed with AIDS had a secondary or university education; by the early 1990s this proportion had fallen to one-third.[7]
Inter-country studies indicate a strong statistically significant association between high HIV prevalence and poor socioeconomic performance.[8] This association holds true whether socioeconomic status is measured by per capita income (Figure 1), income inequality (as measured by the Gini coefficient, Figure 2), absolute poverty (as measured by the population share living on less than $1 a day, Figure 3), or the Human Poverty Index (a weighted measure of mortality, literacy, access to water, sanitation and health services, and malnutrition, Figure 4).[9] While these global correlations can be convincing at first of a simple relationship between AIDS and poverty, analysis of the associations between AIDS and socioeconomic status within continents yields a very different picture. While there is a negative global correlation between HIV prevalence and average income, within Africa, the correlation has the opposite sign. In Africa, there is a positive correlation between HIV infection and socioeconomic status, as measured by schooling, income, or occupation.[10] Botswana and South Africa, two of Africa’s wealthiest nations, have the two highest HIV prevalence rates in Africa.
There are no statistically significant correlations between HIV prevalence and either income or poverty measures across countries within any other continent outside of Africa. Within every other continent except Africa, AIDS appears income neutral. Therefore, although the global associations appear straightforward, they are in fact misleading and not indicative of the entire relationship between AIDS and poverty. These conflicting associations have spawned a number of studies that have attempted to impose structures on ideas linking poverty and HIV, and empirically test these structures. A paper prepared for the UN General Assembly Special Session on HIV/AIDS in June 2001 by the United Nations Development Program (UNDP) argued that the spread of HIV/AIDS jeopardizes economic growth by causing “falling labor quality and supply, more frequent and longer periods of absenteeism, [and] losses in skills and experience, resulting in shifts towards a younger, less experienced workforce and subsequent production losses…[its effects felt] throughout the economy, from the macro-level to the household.”[11]
Early on, AIDS seemed to have little effect on per capita income growth during the period 1980-1992.[12] Since then, AIDS has had a significant impact on the per capita income and the general economy in many countries by affecting the nation’s average life expectancies. Inevitably, these lower generated incomes and depressed economies lead to severely impeded economic growth and development.[13] Recent studies indicate that the macroeconomic effects caused by AIDS are growing the fastest in the worst affected areas. A recent study estimated that Africa’s income growth per capita is being reduced by 0.7% per year because of HIV/AIDS. Had the HIV prevalence rate not reached 8.6% in 1999, Africa’s income per capita would have grown at 1.1% per year – nearly three times the growth rate of 0.4% per year achieved in 1990-1997.[14] A study by Hancock et al. (1996) predicts that by 2005, the Caribbean gross domestic product (GDP) could be reduced by 4.2% and Kenya’s GDP could be reduced by 14.5% as a result of the disease.[15] Similarly, a country-specific econometric model of the South African economy suggests that overall GDP will be 17% lower by 2010 than it would have been without AIDS and that per capita income will be 7-10% lower because of AIDS as well.[16] One key point to keep in mind regarding the effects of AIDS on a macroeconomic scale is that it is extremely difficult to disentangle the economic depression that may be caused by AIDS from that produced by other debilitating social features of a country such as civil wars, corrupt governments, undeveloped institutions, inadequate education, and other health problems.[17] Africa is a prime example of a nation plagued by both AIDS and a tumultuous social landscape.
Overall, the cross-country data indicates that at the global level, poorer countries have a higher rate of HIV prevalence than do more developed, wealthier countries. However, aggregate income alone is not a predictor of trends in HIV prevalence: intra-country social and cultural factors play important roles in the dynamics of the epidemic. In addition, while well-meaning expressions like “world poverty causes AIDS” are partially valid, many do not account for different trends in the AIDS-poverty relationship between countries and between continents. It would be misguided to say that poverty causes AIDS or vice versa on a global level without keeping in mind that Africa confounds the majority of quoted data since it is very poor and contains most of the world’s population infected with HIV as well.
III AIDS and Poverty – Micro Analysis
At the micro level, the AIDS-poverty relationship is a little clearer. A series of recent small-scale studies outline and clarify the extent of the effects of AIDS on households. Household data from Cambodia and Vietnam suggest that poverty and a lack of education significantly increase an individual’s risk of HIV infection. UNAIDS also has found that in some parts of Zimbabwe, agricultural output of small farmers may have fallen by 50% or more in the past five years because of AIDS.[18] In the poorest quarter of households in Botswana, household income has already fallen by 13% because of HIV/AIDS. A World Bank study in Tanzania, Cote d’Ivoire, and Thailand found that people with AIDS were more likely to seek medical care and incur out-of-pocket medical expenses than people who died of other causes.[19] In a study in Thailand, one-third of rural families experienced a halving of their agricultural output as a result of AIDS. Another 15% had to remove their children from school. In addition, families spent on average $1,000 (US) on medical care in the last year of the patient’s life, the equivalent of the average annual per capita income. Lastly, in a survey of urban households infected with HIV in Cote d’Ivoire, the outlay on school education halved, food consumption decreased by 41% per capita, and health expenditure more than quadrupled.[20]
There are several reasons why the poor are generally those who must bear the brunt of AIDS and why the poor also have high HIV infection rates as well (Figures 5,6,7).[21],[22],[23],[24] First of all, the poor are less able to protect themselves from the disease because they have less access to warning information concerning health risks. However, even when poor communities do get information on HIV, they often still fail to take preventative measures because they do not understand the messages or they do not perceive the risk to be significant or urgent.[25] Regarding the long-term nature of AIDS, Alex de Waal, an AIDS writer and activist, has said, “If AIDS is the only disaster that threatens, it is likely that individuals and communities will take action against it. But when AIDS is only one disaster among many, it is not the highest priority.[26]
Second, the poor often cannot reach basic health services. Along with physical obstacles such as an absence of clinics, bad roads, and limited access to transport, the poor frequently have a difficult time dealing with health officials, many of whom are also poorly paid and have been known to extract bribes from vulnerable patients.[27] Therefore, even when the poor can access health services, they maybe reluctant to use them and may turn to alternative, less effective forms of medical treatment. With HIV patients, an inability to access immediate healthcare exacerbates the spread of the disease significantly. Not only do HIV patients incur large decrements in their own health, but they also run the risk of spreading the disease unknowingly to any of their partners.
Third, the poor are more likely to be forced by economic hardship into making sub-optimal health choices. Poor women may be forced to turn to prostitution, and poor prostitutes are more easily forced into unprotected sex, either by competition or by physical assault from their employers.[28] In addition, poor men, who can normally barely afford to buy food for their families, are unlikely to spend scarce income on condoms. Together, these factors make poor communities less able than wealthier groups to mobilize themselves against the threat of AIDS. For example, the Henan province in China has recently seen an alarming outbreak of HIV as poor farmers have resorted to selling their own blood to local authorities for money. This often contaminated blood is pooled and the plasma is extracted, and ultimately is injected back into members of the community, thus spreading the disease throughout the province. Many villages in Henan province currently have HIV prevalence rates higher than 60%.[29]
Fourth, the financial burden of caring for an individual with AIDS is often unbearable. AIDS patients are subject to a long and often ultimately hopeless illness, in which they will be unable to work extended periods of time. However, from the start, many patients are not provided with an accurate diagnosis, and frequently spend large sums of money on treatment procedures of marginal efficacy and worth. A study in Cambodia found AIDS expenditures to be equal to many times an extended family’s annual income, funded by the sale of assets and debt at high rates of interest.[30] Therefore, the effects of one case of the illness can be widespread, and can force a family with one afflicted individual to sell its land, remove one or more children from school, lose savings, and divert expenditure away from other essential areas. These actions can inevitably lead to a vicious cycle of impoverishment. As family members leave home to find work, many become infected in the process and must return home, thus further draining family assets and forcing yet another family member to leave home and find work. In addition, when infected family members return home, they also increase the probability that a spouse or others in the community will contract HIV.
Lastly, individuals with HIV are extremely vulnerable to tuberculosis (TB) infection, which is responsible for the death of a third of the people with AIDS worldwide.[31] UNAIDS has found that one third of the increase in TB cases over the last five years is attributable to HIV. However, even though HIV is increasing the spread of TB, TB infection rates are increasing even amongst HIV-negative people. According to World Bank estimates, “about one out of four TB deaths among HIV-negative people would not have occurred in the absence of the HIV epidemic.”[32] Financially, TB affects the poor to a much greater extent than the rich, and because it is a long-term, costly disease like AIDS, it exacerbates the economic distress already felt by poor AIDS patients.
The relationship between AIDS and poverty is vastly complex, and involves a variety of interrelated social, political, and economic issues. From global data, it is clear that the macro link between AIDS and poverty is often misleadingly simple, while domestic data indicates that the micro link is more straightforward. On either level, it is clear that poverty must be alleviated before any significant strides can be made towards AIDS containment and reduction. Among the many poverty reduction techniques proposed by the World Bank, World Health Organization, and UNAIDS, debt relief has gained the most attention as a plausible solution to the AIDS-poverty dilemma.
IV Poverty Reduction and Debt Relief
The idea of debt relief as a possible way of alleviating the effects of AIDS was first brought to the global environment through the Highly Indebted Poor Countries (HIPC) Initiative in 1996. Proposed by the World Bank and the IMF and agreed to by governments across the world, the Initiative is a planned approach among official creditors to lower external debt. In September 1999, an enhanced version of the Initiative was enacted to simplify and accelerate the debt relief process, deepen the amount of debt relief, and tighten the link to poverty reduction. Overall, the Initiative emphasizes structural and social policy reforms, especially those which enhance the delivery of basic health care and education services. Governments benefiting from debt relief are required to make their plans for poverty reduction explicit through the preparation and writing of official Poverty Reduction Strategy Papers (PRSPs), which contain sections addressing the issue of HIV/AIDS and poverty.
The principal objective of debt relief is to bring a country’s debt burden to a sustainable level, subject to satisfactory policy performance, so as to ensure that adjustment and reform efforts are not put at risk by continued high debt and debt service burdens.[33] The debt relief process involves two key phases, the first culminating in a “decision point,” and the second leading to a “completion point.” To reach a decision point, a debtor country must achieve a three-year period of satisfactory performance on the macroeconomic adjustment and reform programs supported by the IMF and World Bank. Once this is achieved, then the Executive Boards of the IMF and World Bank formally decide on a country’s eligibility for debt relief and the international community commits itself to providing assistance to the country until a set completion point is reached.
According to the HIPC Initiative, debt sustainability is defined as 150% of the level of export at net present value. Under the enhanced framework, the benefits of export and central government revenue accrue fully to a country, thus allowing greater investment in poverty reduction strategies.[34] At the decision point, a country benefits from roughly 30% of the total amount of debt relief to be granted. After the decision point has been reached, a country begins the second phase and moves towards the set completion point where the majority of assistance by the enhanced HIPC Initiative is ultimately delivered (Figure 8). Interim assistance can also be made between the decision and completion points, with any remaining assistance provided at the completion point. So far, 22 countries have reached their decision point under the enhanced HIPC Initiative and one country, Uganda, has reached its completion point. These 22 countries are currently receiving relief that will amount to roughly $34 billion over time.[35]
To effectively combat AIDS and poverty at the same time, it is essential that PRSPs include the following components in regards to the AIDS-poverty dilemma (Figure 9):[36]
- AIDS as a cause of poverty, including discussions of poverty and income inequalities as contributors to conditions which make individuals vulnerable to HIV infection and less able to cope with the effects of being infected.
- Main strategies in a national AIDS plan as a key component of the overall national poverty reduction program.
- Medium-term goals and poverty monitoring indicators derived from a national AIDS plan.
- Short-term plans for the successful and efficacious implementation of a national AIDS plan, with conditions for debt relief.
In the majority of countries accessing debt relief, AIDS program managers and officials are able to claim more funding for HIV/AIDS in the context of the development of poverty reduction strategies. Therefore, debt relief not only provides the possibility of having new resources to fight HIV, but it also gives the opportunity to place HIV/AIDS at the center of development and aid agendas. However, despite the availability of external resources through different initiatives, many AIDS programs in poor countries have not reached a scale that can make a significant impact on the epidemic. Increases in internal revenue for social sectors are additionally needed in order for the AIDS programs of these poor countries to reach an effective scale.
There are four main ways in which internal revenue increases can help AIDS programs reach scale: First, they can help place HIV/AIDS within the framework of budgetary discussions, thus breaking the cycle of donor-driven program design and financing. Second, they can institutionalize the response to HIV/AIDS in all activities of the government, therefore making new fiscal space available to provide additional resources for specific social purposes. Third, they can transform fragmented activities into sustained programs by freeing the country from dependence on donors for key inputs (i.e. financing drugs for TB control or condoms for the military). Lastly, they can help address broader issues not always directly linked to HIV/AIDS, but that can affect the response and contribute to the spread of the disease.
Given the importance of increased revenue to AIDS programs, it is critical for policy makers to think strategically about how debt relief funds can be used to complement one another rather than compete to fund similar programs. In addition, debt relief funds must be utilized in such a way that they develop the capacity to exert leverage and absorb further available external funding. Mali is a good example of a country that has effectively used debt relief funds to implement health programs to combat AIDS. In Mali, while the health sector benefits from a large externally funded sector investment program, HIPC funds are used to reinforce the implementation capacity by financing basic training as well as contracting of staff and providing incentives for them to deliver essential public health interventions.[37]
V Conclusion
Even with the abundance of information that exists linking AIDS and poverty, the extent of the relationship between the two remains uncertain. While early studies showed that the wealthy were more vulnerable to HIV because they could more easily afford to pay for sex and drugs, it is also true that 95% of people currently living with HIV/AIDS live in extremely poor developing countries. A macro analysis of AIDS and poverty might at first glance appear to suggest a causal relationship between the two, but often times this conclusion is distorted by Africa, home to 13% of the world’s population and 72% of those living with AIDS. Asia, on the other hand, contains 60% of the world’s population, but is host to just 18% of HIV infections. On a large-scale, inter-continental level, it is nearly impossible to isolate and study the role that AIDS plays in poverty and vice versa because HIV is beset by a wide variety of immiserating social conflicts.
In the absence of strong macro-level and inter-continental data, many health policy officials rely on micro-level small-scale studies. Local studies point to a strong immiserating impact of AIDS at the household level. However, while these studies provide clearer evidence for the link between AIDS and poverty, they do not specifically elucidate whether poverty leads to AIDS, AIDS leads to poverty, or both. Therefore, the connection between the two remains complex and far from clear-cut. Certain risk factors for HIV are more prevalent among the poor, but others are found more often among the rich. It appears that there are combinations of factors, poverty being one of them (along with mobility, multiple-partners, and prostitution), that put people at greater risk of HIV infection than others. Regardless of the exact nature of the relationship between AIDS and poverty, it is clear that a relationship does exist, and because of this, poverty reduction techniques need to be implemented in order to comprehensively combat the AIDS epidemic.
Debt relief assistance through the HIPC Initiative appears to be the most effective way of simultaneously combating poverty and health issues including AIDS. The Initiative allows countries to lower their debt burden so that their populations do not fall into the downward spiral of AIDS: direct and indirect income loss because of HIV contraction, which forces related individuals to engage in risky behaviors to cope with the subsequent financial burden, which ultimately causes these same individuals to contract HIV and cause further economic distress while also spreading the disease. In general, though, in order for the HIPC Initiative’s debt relief program to be effective, each country seeking aid must pro-actively engage in programs that address and combat AIDS as outlined in their PRSPs, and the World Bank and IMF must monitor and enforce these programs to ensure their efficacy and progress.
VI Appendix
Figure 1. The global association between per capita GDP and the
rate of adult HIV prevalence. (from UNAIDS 2001 report)
Figure 2. The global association between economic inequality as
measured by the Gini index and the rate of adult HIV prevalence. (from UNAIDS
2001 report)
Figure 3. The global association between the Absolute Poverty Rate
(<$1/day) and the rate of adult HIV prevalence. (from UNAIDS 2001 report)
Figure 4. The global association between the Human Poverty
Index (a weighted measure of mortality, literacy, access to water,
sanitation and health services, and malnutrition)
and
the rate of adult HIV prevalence. (from UNAIDS 2001 report)
Figure 5. The links between HIV/AIDS and poverty: a simplified
view. There are two main sets of
issues: 1) AIDS as a cause of poverty or AIDS deepening poverty and 2) the
combined effect of poverty and income inequalities on social transactions –
including sex, patterns of vulnerability and patterns of risky behavior in
relation to AIDS.
Figure 6. How AIDS causes poverty. Once infected, individuals
face direct catastrophic costs in terms of health and social care, plus
indirect costs in terms of lost productivity.
Figure 7. How poverty increases the likelihood of HIV infection
and AIDS.
Figure 8. Key features of the HIPC Initiative’s two-phase debt
relief program.
Figure 9. Essential sections on AIDS in PRSP and HIPC documents.
The number of *s indicate the relative importance of each aspect.
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