Macro-Economic Impact of HIV and AIDS on the Zimababwean Economy: A Human Capital Approach

by MATSHE, I, 2008
Botswana Journal of Economics Volume 5. No.7, October, 2008

Zimbabwe is one of the countries severely affected by the HIV/AIDS epidemic. The high prevalence of the disease is not only a health problem but has become an economic problem, yet little effort had previously been directed at establishing the exact magnitude of HIV/AIDS’ economic impact. Using a human capital approach which measures the value of production lost as a result of HIV/AIDS – related morbidity and mortality and values an infected person’s economic return to society using an individual’s annual income, the study establishes that HIV/AIDS has resulted in significant output losses for the Zimbabwean economy. About 13.32% of 1993 GDP at factor cost (was lost due to HIV/AIDS in the years 1994 to 2003. The macroeconomic impact of HIV/AIDS is severe and can therefore not be ignored even if the prevalence drops to zero in the present period