A case study: Malawi


In Malawi, 16% of adults are infected with HIV and 31% of women attending ante-natal clinics are HIV-positive.

The impact of HIV/AIDS on the economy is already affecting economic growth rates. A study of tea workers shows mortality rates increased sixfold between 1991 and 1995, costing the company surveyed 6% of its operating profit. In 2000, Malawi's gross domestic product was already lower by 5% due to HIV/AIDS.

Government spending on education is US$82 million, a country with only 58% adult literacy (1998). There is only one doctor per 50,000 people.

Yet, government spending on health care of US$51 million was dwarfed, in 1999, by debt repayments of $102 million. Even though debt relief reduced annual repayments to between US$51-59 million in 2000, a condition of that relief was that health expenditure must remain 15% lower than 1997/8 levels, when expenditure peaked.

Meanwhile the cost of scaling up Malawi's anti-AIDS programme to an effective level is estimated at $152 million.

Source: The Vicious Circle, World Development Movement.