HIV/AIDS+WORK Swaziland

More documents

Recommendations

Info

B. Economic impact of HIV/AIDS12 South African Customs Union—namely, Botswana, Lesotho, Namibia, South Africa and Swaziland13 UN Office for humanitarian affairs ‘Integrated regional information network’ website.8Swaziland: HIV/AIDS work and developmentMore than 80% of the population inSwaziland is engaged in subsistenceagriculture. Recently, however, the textileindustry has been expanding rapidly, largely asa result of Taiwanese investment associatedwith the implementation of the USA’s AfricaGrowth and Opportunity Act (AGOA). Themanufacturing sector has diversified since themid-1980s. Mining has declined in importancein recent years, with only coal and quarrystone mines remaining active. The economyis heavily dependent on South Africa, fromwhich it receives nine-tenths of its imports andto which it sends more than two-thirds of itsexports. Customs duties from the SouthernAfrican Customs Union and worker remittancesfrom South Africa substantially supplementdomestically-earned income.The government is trying to improve theatmosphere for foreign investment. The Swazieconomy relies heavily on the export sector,which is largely based on agriculture (whichaccounts for 10% of GDP), agriculturally-basedindustries along with manufacturing (48%of GDP). Since the economy of Swaziland isdependent on scarce skilled manpower, it ispredicted that the impact of HIV/AIDS will besevere.1. Macroeconomic impactSwaziland has a GDP per capita ofUS$1,390 and is significantly poorer than itsSACU 12 neighbours, such as Botswana andNamibia. There are two forms of land holdingsin the country. Fifty per cent of rural land isFigure 6. Total GDP at constant (1985) factor cost160014001200100080060040020001995/96 1996/97 1997/98 1998/99 1999/2000 2000/01Source: Central Bank SwazilandTotal (Em)at constant(1985)factor costheld in trust for the Swazi Nation by the kingand is farmed on a subsistence basis by smallfarmers. The balance is farmed using modernmethods by companies and individuals oftenin partnership with the government and theSwazi Nation. Some 40% of the land is titledeed land, used in sugar estates and forestryplantations. The land holdings are held in trustfor the king and controlled by chiefs accordingto traditional arrangements. More than 50% ofthe income is obtained from its share of SACUcustoms revenue.i. Trends in Gross domestic productThe GDP growth in the country is shown inFigure 6. Despite AIDS, the macro-indicatorsapparently have not changed much but thesefigures do not depict the changes withinvarious folds of the economy. These changescan be understood by looking at case studiesin specific sectors. GDP growth was fairlyconsistent until date (see figure 6). Currently,the outlook is poor as Swaziland is not anattractive prospect for foreign investment. Theeconomic growth rate increased from 2.7% in1998 to over 3% in 1999, after which it fell to2.5% in 2000, before further falling to 2% in2001.ii. UnemploymentFormal employment is quite stagnantin Swaziland, while informal employment isincreasing (and the tax base changing). HIV/AIDS is definitely having a negative impacton the employment situation. Formal-sectoremployment recorded only 749 additional jobsto the country’s 93,962 jobs already existingin 2001, which is low even for a small economysuch as Swaziland’s. Unemployment standsat 40%, according to the Ministry of EconomicPlanning and Development 13 .A shortage of workers leads to higherwages, which leads to increasing labour costs.The poor growth of the labour force causescapital output ratio to rise faster. The informalsectorworkers are most likely to suffer fromthe consequences of HIV/AIDS, since they donot have health facilities or social-protectionarrangements in their workplaces. This will,in turn, disrupt productivity as the frequentreplacement of workers becomes increasinglydifficult. Moreover, the replacements will
not immediately reach the same levels ofproductivity, due to less experience. Theeffect will be more pronounced where on-thejoblearning is important. There is a lack ofinformation on prevalence rates in differentsegments of the labour force, and the impactof HIV infection on the productivity of infectedworkers.iii. PovertyHIV/AIDS deepens poverty and increasesinequalities at every level—household,community, regional and sectoral. Povertycontributes to epidemic disease, whichcontributes to poverty, thereby creating avicious circle. For example, loss of labour in afarming system may result in failure to maintaininfrastructures such as terracing, leadingto soil erosion, and decreasing agriculturalproductivity. This will impoverish householdsand communities, reduce their ability to sustainthemselves and result in poorer socialization,less formal education and, ultimately, cultural aswell as material impoverishment. In 1997, thefood poverty line 14 included 48% of the nationalpopulation (29.7% of the urban and 55% of therural), and the total poverty line included 65.5%(45.4 % urban and 70.6% rural).2. Impact on specific economic sectorsThere is ample evidence to substantiate thatAIDS-related mortality is incrementally erodingthe capacity of various economic sectors and,inevitably, has dramatic repercussions. Theimpact of the epidemic has been studied inthe private sector as well. Businesses have feltthe socio-economic impact of the epidemic.The excess morbidity and mortality due toAIDS have significantly reduced productivity,increased production costs (due to highabsenteeism and funeral attendance) andcaused disruptions in business operations. Themain causes of increase in cost for companiescan be attributed to increased death benefits,medical costs, training costs and funeral costs.There has also been an increase in recruitmentcosts; costs due to reasonable accommodation,catering for employees’ families and orphans;and extended succession plans.i. Public sectorThe public sector in Swaziland has felt theimpact of HIV/AIDS, as evidenced by firm-levelstudies. These studies have empirical dataon the actual impact of AIDS on depletionof resources. In 2001, an assessmentwas commissioned by the Government ofSwaziland to determine the impact of HIV/AIDSTable 1: HIV prevalence (%) in Swaziland, by regionYear 1998 1999 2000 2001Private sector 59 983 61 003 61 613 60 381Public sector 31 891 32 210 32 693 33 216Total formal employment 91 874 93 213 94 306 93 597% change 1.46 1.17 -0.75Informal sector 11 8244 12 6175 13 5509 14 5925Source: Central Bank Swazilandon the three Central Agencies of the country.These are the Ministries of Finance, EconomicPlanning and Development, and Public Serviceand Information. This study concluded that, asa result of HIV/AIDS alone, the three ministrieswill lose 32% of their staff to the epidemic over20 years. Moreover, it will result in increasedpension fund contributions, sick leave,compassionate leave, training and other costs.The current value base cost of the epidemic tothe three central agencies is (conservatively)estimated to be (in local Lilangeni) E 10,535,994 over the period 2002–2010. Thisequates to 1.5% of the annual salary budgetfor the three ministries 15 .These ministries employ an essential partof the labour force in the country. Over 70%of Swaziland’s labour force works on land andthe Ministry of Agriculture and Cooperatives(MOAC) is mandated with ensuring that the landremains productive and continues to serve thepopulation. The MOAC is faced with increasedmorbidity and mortality among its employees.While not all of these deaths or illnesses canbe attributed to HIV/AIDS, there is a definiteincrease in retirements, pension payouts andexpenditure on health care by government (SeeFigure 7).Figure 7. Trend in pension payout by the public service fund to its members(1995-2001)1001010.11995 1996 1997 1998 1999 2000 200114 UN Common Country Assessment: http://www.ecs.co.sz/cca(Logarithmic scale)pension annuitydeath annuityretirementgratuitySource: Government of Swaziland, Assessment of the Impact of HIV/AIDS on the Central Agencies of the Government of the Kingdom ofSwaziland.15 Government of Swaziland, Assessment of the Impact of HIV/AIDS on the Central Agencies ofthe Government of the Kingdom of Swaziland: Executive Summary. 2002.Swaziland: HIV/AIDS work and development9
Page 1 and 2: HIV/AIDS+WORKSwaziland:HIV/AIDS, wo
Page 3 and 4: AcknowledgementsThis report was dev
Page 5: ContentsExecutive summary 1A. Situa
Page 8 and 9: A. Situation analysisPiggsPeakMhlum
Page 10 and 11: 4Swaziland: HIV/AIDS work and devel
Page 12 and 13: Figure 3. Age-wise loss in the acti
Page 16 and 17: 16 Pension annuity refers to on-goi
Page 18 and 19: 30 Muwanga FT (2001) Private sector
Page 20 and 21: Table 4: Companies that have workpl
Page 22 and 23: C. Policy optionsDeveloping a polic
Page 24 and 25: D. RecommendationsThe commitments o
Page 26: ISBN-92-2-117159-0ILOAIDSInternatio

HIV/AIDS+WORK Swaziland

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?