AIDS Day 2011: The Impact Of AIDS On African Business Is Devastating

We recently talked about dealing with AIDS and HIV in the workplace but what about the actual impact of this epidemic on businesses and the economy in Africa? As you can imagine, the effects of AIDS and HIV in Africa have been absolutely devastating. And businesses continue to suffer because of the disease hitting the country’s workforce.

According to avert.org, the majority of people living with HIV in Africa are aged between 15 and 49. With this age group being hit hard that means total reduction of the workforce. According to Top Secret Writers:

“A reduction of workforce creates a long and negative snowball effect. Businesses are negatively affected by decreased productivity, companies have to spend more pension funds, funeral benefits and health-care commitments, and as the AIDS epidemic increases in severity, the market demand for products and services fall. With absenteeism within the workforce sharply rising, fewer people pay taxes, and government income becomes inevitably sparse. With less tax revenue, the governments of developing countries deeply affected by HIV and AIDS are pressured to increase spending in order to cope with the growing epidemic.”

According to comparative studies of East African businesses, the AIDS epidemic accounts for 25-54% of company costs. Only 13% of the companies surveyed in the study have any company policies in place to deal with HIV and AIDS. It is estimated that AIDS-related effects could have cut company profits in southern African countries by at least 6-8%. Forty percent of the businesses involved in the study reported a negative effect caused by HIV and AIDS. Although the economic impact of the AIDS and HIV epidemic is difficult to measure, it has been estimated that there has been a loss of approximately 1% in sub-Saharan Africa’s gross domestic product due to the AIDS crisis.

When you hear the kind of damage that this disease is doing not only to people but literally to every facet of society in Africa it is astounding. But progress is happening as according to data from ONE, a grassroots advocacy and campaigning organization that fights extreme poverty and preventable diseases, the average cost of AIDS treatment per person through PEPFAR is down nearly 70% since 2004 and 22 countries in sub-Saharan Africa have reduced new HIV infections by more than 25%. But in order to keep this improvement going businesses need to step up not only in Africa but all over the world. Treatment Action Campaign (TAC) Skills Development Officer Lawrence Mbalati said the business sector in South Africa must promote labor laws that are “non-discriminatory” and augment funding towards HIV/AIDS programs. “Business must take a lead in fighting stigma and discrimination at workplace and communities by promoting labor laws that are non-discriminatory and promoting conducive environment for HIV testing and treatment,” Mbalati told Xinhua. “Business must also increase strategic health and HIV funding. It must promote capacity building and skills development for community empowerment and development.”

Photo: michaeljung/Shutterstock.com

For more information on World AIDS Day, go to ONE.org.

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