HIV and the Financial Crisis
Academic Council Debate on the Financial Crisis and Public Health
Robert Greener, April 30, 2009
Magnitude of the Epidemic
• 33.2 million living with HIV– 67% in sub-Saharan Africa
• 2.5 million new infections per annum
• 2.1 million deaths per annum– number infected still growing
• More than 3 million on ARV treatment
• Most infections are in low and middle-income countries
The World of HIV
© Copyright 2006 SASI Group (University of Sheffield) and Mark Newman (University of Michigan).
The World of Income
© Copyright 2006 SASI Group (University of Sheffield) and Mark Newman (University of Michigan).
Prevalence and Impact – the “long waves” of HIV
T1 T2 Time
Numbers
A1A2
HIV prevalence
B1
A
B
AIDS - cumulative
Impact
T.Barnett, A.Whiteside
The Financial Crisis(or is it an economic crisis?)
• There is general consensus within (and beyond) the UN system on the key elements of the crisis– The crisis is affecting both advanced and
developing countries– Financial conditions facing developing countries have
deteriorated sharply, and the crisis will have long-term implications for them
– The challenge is to protect or expand critical expenditures in the social sector – safety nets, human development and infrastructure
– There is a strong need to expand assistance to developing countries to protect these expenditures and prevent the erosion of progress in reducing poverty
Domestic Resources
In low and middle-income countries
Private Sector – and workplace
Individuals – Out of pocket and insurance -Not well known
Domestic Public Sector
Government Budgets in low and middle-income countries
External Resources
From high-income countries
Private Foundations
Direct Bilateral Cooperation
Targeted and Sectoral Aid Budgets
Multilateral Institutions
GFATM, UN, EUGlobal Innovative
Mechanisms
South-South CooperationTriangular Cooperation
Regional Cooperation
Public Sector
Public Sector
Bilateral Donors
Private Sector
Private Sector
What will happen to domestic funding for HIV?
• Most of the domestic funding is within middle-income countries such as Brazil, South Africa and Thailand
• Evidence for the past is that social spending has been reduced during times of economic downturn
• This picture is not uniform, and cannot be used as a guide for the future – social spending is a policy choice.
ODA and GNI in OECD1980-2007
50,000
60,000
70,000
80,000
90,000
100,000
110,000
120,000
1980 1985 1990 1995 2000 2005
OD
A f
rom
OE
CD
Co
un
trie
s
15,000,000
20,000,000
25,000,000
30,000,000
35,000,000
GN
I in
OE
CD
Co
un
trie
s
ODA GNI
fall of 4.9% per annum for 5 years during strong GDP growth (3.2% p.a.)
5-8 years to recover
Resource Availability for HIV2005-2008
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
2005 2006 2007 2008
US
$ m
illi
on
Domestic (Public and Private)*** Bilateral ODA*Multilateral ODA* Philanthropic sector**
$7,918$8,835
$13,765
$11,322
Source: *OECD/DAC CRS; data extracted on 2009/01/15 13:13 from OECD.Stat** FCAA (2008) and EFG (2008)*** UNADIS, 2008
52%
31%
12%
5%
Estimated Resource Needs2007-15
36.7
25.1
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
2007 2008 2009 2010 2011 2012 2013 2014 2015
Key Issues for UNAIDS
• What are the vulnerability implications of:– Increasing unemployment– Decreasing remittances– Increasing poverty and food insecurity– Possible wider effects, such as deteriorating
governance
• What are the long-term implications of making bad choices now?
The Impact on AIDS
• The global economic crisis threatens to reverse gains in health and poverty alleviation in developing countries
• These effects are likely to be magnified by the impact of the crisis on the HIV epidemic, especially in the high HIV prevalence countries in sub-Saharan Africa
Country Vulnerability
Vulnerability to the Crisis• Undiversified domestic economy• High level of poverty• Low fiscal capacity• Low institutional capacity
– Undeveloped social protection systems
Vulnerability of HIV Programmes• HIV resource needs in relation to GNI
Current Perceptions
• Information collected in late March 2009 from 69 countries (in which 3.4 million people are under treatment) shows that:– In 12% of the surveyed countries, the crisis is
already impacting treatment programmes.– In 32% of the countries—home to 61% of
those under antiretroviral treatment—an impact is expected this year.
The risks of reduced treatment
• Increased mortality and morbidity Unnecessary death and disease (including increased tuberculosis) due to AIDS
• Greater transmission risks as people off treatment become more infectious
• Higher financial costs Interruptions of treatment make treatment failure more likely, requiring use of costly second-line regimen drugs
• Increased burden on health systems. More HIV-related illnesses, and pressure on health services at a time when their budgets are being cut
• Reversal of economic and social gains. Consequences for households, and costs to businesses and public agencies.
The risks for prevention
• If treatment programmes are protected, there is a risk that funding for prevention will be cut
• If this happens, it will lead to more AIDS illness and treatment need in the future– Higher costs of treatment programmes– Welfare impacts for households
Core Challenges
• Universal Access: To maintain and expand HIV programmes
• To increase the effectiveness with which resources are used
• To secure long-term sustainable financing for HIV from both external and domestic sources
Challenge of Universal Access
• Access to prevention, treatment and care has produced measurable results
• Estimated resource needs to continue the scale up to Universal Access will require almost double what is currently available (about $25 bn. per annum)
• Most of these increases will have to be met from international aid funding
The Challenge to Increase Effectiveness
• This challenge is highlighted by the financial crisis
• Money from all sources must be used as effectively as possible for prevention, treatment and impact mitigation
• Programmes must be designed to target the root causes of vulnerability and impact
Challenge of Sustainable Financing
• The AIDS response is a core pre-requisite for the Millennium Development Goals
• Countries will need to reprioritize their spending towards social goals such as health, while also tapping a diverse and innovative mix of financing sources
• The international community will need to maintain resolve and urgency for all of the MDGs