III. Socio-Economic Impacts of HIV/AIDS

AIDS, while continuing to be an important health issue, has evolved into a complex social and economic emergency. HIV primarily affects young adults, cutting a broad path through society's most productive layer and destroying a generation of parents, whose death leaves behind orphans, desocialized youth and child-headed households. AIDS has a significant impact on the more educated and skilled segments of society because HIV primarily infects productive young adults rather than children or the elderly. The stigma attached to HIV and AIDS adds to the impediments encountered in mounting a response to AIDS, in addition to the discrimination already faced by infected individuals. HIV also increases social and economic vulnerability among women.

In the hardest-hit regions, AIDS is now reversing decades of development. It changes family composition and the way communities operate, affecting food security and destabilizing traditional support systems. By eroding the knowledge base of society and weakening production sectors, it destroys social capital. By inhibiting public and private sector development and cutting across all sectors of society, it weakens national institutions. By eventually impairing economic growth, the epidemic has an impact on investment, trade and national security, leading to still more widespread and extreme poverty. In short, AIDS has become a major challenge for human security.

A. Demographic Impacts

AIDS deaths are premature deaths. In countries where HIV spreads mainly through unsafe sex between men and women, the majority of infected people acquire HIV in their twenties or thirties and will die of AIDS on average a decade later. In a number of countries, AIDS has resulted in increased mortality among children under five, and is now wiping out half a century of development gains, including increases in life expectancy at birth, particularly in southern Africa, where life expectancy increased from 44 years in the early 1950s to 59 in the early 1990s. Between 2005 and 2010, it is expected to fall to 45 years and even lower in some countries.

The lifetime risk of dying of AIDS is far higher than the general prevalence rate would suggest. For example, where prevalence is 15 per cent and rates continue to apply through their lifetime, over half of today's 15-year olds will die. In Botswana, which has a prevalence rate of 36 per cent, over three quarters would die of AIDS. In some countries, these trends are reshaping the traditional population pyramid into a new population chimney," with a narrowing base of young people and children. The most dramatic change in the pyramid occurs when young adults, infected early, begin to die of AIDS. Only those adults who escape HIV infection can expect to survive to middle and old age. Also, recent studies among various African populations indicate that rates of HIV infection in young women aged 15 to 19 may be five to six times higher than in young men.

B. Social Impacts

The premature death of large numbers of young adults has an inevitable impact on those societies most affected by AIDS.

Households and Families

Households and families bear the brunt of the misery caused by AIDS. Those who fall ill become unable to work, forcing family members to care for them rather than producing food or income. According to studies of rural families in Thailand and urban families in Côte d'Ivoire, farm output and income fell between 52 and 67 per cent in families affected by AIDS. Families are also subject to discrimination if they have members who are HIV-positive, often facing reduced access to publicly available social and economic benefits.


The gender dynamics of the epidemic are far-reaching due to women's weaker ability to negotiate safe sex and their generally lower social and economic status. More women than men are caretakers of people with AIDS, which may saddle them with the triple burden of caring for children, the elderly and people living with AIDS -- as well as financial responsibility for their family's survival. Girl children or older women may find themselves at the head of households, and many girls from families facing poverty risk exploitation, especially sexual exploitation, when trying to bring in additional income. Mother-to-child transmission is also a concern.


Where AIDS is widespread, education -- an essential building block of development -- is being impaired. The epidemic is eroding the supply of teachers and diluting the quality of education. AIDS also reduces the amount of money available for school fees, and forces an increasing number of children -- more girls than boys -- to drop out of school in order to help at home. As teachers become ill and unable to work, some schools are closing. In parts of Southern Africa, one fifth of teachers and secondary school students are estimated to be HIV-positive.

Health Services

Since the beginning of the epidemic, 21.8 million people have fallen sick and died of AIDS, placing ever-increasing demands on health services in the worst-affected countries. Often, this increased demand stretches already over-burdened public health systems. In 1997, public health spending on AIDS alone exceeded 2 per cent of gross domestic product (GDP) in seven of 16 African countries sampled, a staggering amount for countries whose health expenditure for all diseases accounts for 3 to 5 per cent of GDP. Adding to these increased demands is the crushing burden of AIDS on health workers themselves. A study in Zambia showed that in one hospital, deaths among health-care workers increased by a factor of 13 over a decade, largely because of HIV. Overburdened public health systems may also further marginalize minority, disabled and elderly women with HIV/AIDS. HIV-positive people also lack access to medicines and to health care, often facing discrimination from hospital staff or health-care systems.


AIDS has a dramatic impact on children, particularly through the emergence of an entire generation of orphans to families affected by HIV. To date, the epidemic has left behind 13.2 million orphans, children who before the age of 15 have lost either their mother or both parents to AIDS. Studies have shown that children orphaned by AIDS are at greater risk of malnutrition, illness, abuse and sexual exploitation than children orphaned by other causes. The stigma and discrimination they face can also deprive them of basic social services and education. Today, in many African countries 20 to 25 per cent of all households are fostering orphans. The long-term consequences of such shifts in socialization are incalculable.

Human Development Index

The Human Development Index (HDI), a generally accepted measure of development based on economic and social indicators, is also affected by AIDS. In Namibia, for example, the HDI is predicted to fall 10 per cent by 2006 and in South Africa by 15 per cent before 2010 because of AIDS.

C. Economic Impacts

Economic Growth

Growing evidence suggests that AIDS is having a devastating effect on economic growth and incomes. According to the World Bank, had average national HIV prevalence in sub-Saharan Africa not reached 8.6 per cent in 1999, per capita income on that continent would have grown 1.1 per cent, nearly three times the actual growth rate of 0.4 per cent achieved during 1990-1997. In the case of a typical sub-Saharan African country with a prevalence rate of 20 per cent, overall GDP growth would be 2.6 per cent lower each year. At the end of 20 years, the economy would be two thirds smaller than it would otherwise have been.


AIDS reduces the number of healthy workers, especially experienced workers in their most productive years. This raises dependency, diminishes human capital, and may cut productivity growth by as much as 50 per cent in the hardest hit countries.

Public Sector

In the public sector, AIDS reduces government revenues and puts severe strain on budgets as spending on health and social welfare mount. Scarce capacity is depleted, and the return on other public investments falls.


Governance suffers as a result of the epidemic: HIV/AIDS has a disastrous impact on the capacity of Governments, especially on the delivery of basic social services. Human resources are lost, public revenues reduced and budgets diverted towards coping with the epidemic's impact. Similarly, the organizational survival of civil society institutions is under threat, with a corresponding impact on democracy.

Private Sector

In the private sector, firms face higher costs in training, insurance, benefits, absenteeism, medical costs, sick leave, funerals and pensions. At the same time, the average experience of their labor force falls, reducing accumulated knowledge within firms. The most seriously affected businesses are those that are labor-intensive, such as transport. Companies in Africa have already felt the impact of AIDS on their bottom line. One sugar estate in Kenya quantified the cost of HIV infection as 8,000 days of labor lost to illness in two years, a 50 per cent drop in processed sugar recovered from raw cane in four years, and a tenfold increase in health costs. The company estimated that more than three quarters of all illness was related to HIV infection.


AIDS also threatens the basic livelihood of people living in developing countries, especially the poor. In many countries, agriculture provides a living for as much as 80 per cent of the population. As adults in rural areas fall ill, productivity drops off dramatically. Patterns of cropping shift from cash crops to subsistence farming, reducing household income and forcing the family to sell such assets as equipment or cattle to get by. Children may be withdrawn from school to help with work or tend to the sick, impairing their own development. In some areas, women dominate agricultural labor -- up to 80 per cent -- and this requires a gender-sensitive response to HIV/AIDS.

D. Impact on Security

The reverse in economic growth and development gains being experienced in some countries affected by AIDS is magnified by the fragility and complexity of geopolitical systems. The epidemic is present in a number of countries already facing conflict, food scarcity and poverty, and poses real threats to social and political stability where it is most concentrated -- in Africa. The Security Council redefined security as an issue going well beyond the presence or absence of armed conflict, one which affects health and social services, family composition and social structure, economies and food security.

There is now broad acknowledgement that AIDS has become a global development crisis, potentially affecting national security in some countries. Armed conflict and associated population movements provide fertile ground for the spread of AIDS, while the epidemic itself can be seen as a risk factor in the breakdown of social cohesion and in social and political instability, in addition to a threat to security forces.