Macroeconomic and household-level impacts of HIV/AIDS in Botswana

Abstract

Objective: To measure the impact of HIV/AIDS on economic growth and poverty in Botswana and estimate how providing treatment can mitigate its effects.

Methods: Demographic and financial projections were combined with economic simulation models, including a macroeconomic growth model and a macro-microeconomic computable general equilibrium and microsimulation model.

Results: HIV/AIDS significantly reduces economic growth and increases household poverty. The impact is now severe enough to be affecting the economy as a whole, and threatens to pull some of the uninfected population into poverty. Providing antiretroviral therapy can partly offset this negative effect. Treatment increases health's share of government expenditure only marginally, because it increases economic growth and because withholding treatment raises the cost of other health services.

Conclusion: Botswana's treatment programme is appropriate from a macroeconomic perspective. Conducting macroeconomic impact assessments is important in countries where prevalence rates are particularly high.