2004

HIV/AIDS has a triply devastating effect on poverty reduction in heavily affected countries. At the national level, the adverse impact on economic growth short-circuits the most powerful engine for sustainable poverty reduction: rising national income.

At the individual level, the poor are far more vulnerable to the disease than the rich. They also have far fewer mechanisms for coping with the AIDS-related loss of income and the added burden of first caring for and then burying the victims. For families living in or near poverty, the onset of AIDS and associated illness in even one parent can be tragic.

Plus intensified poverty heightens the risk of further transmission of the disease as a result of malnutrition, lack of education, inability to afford condoms, and economic pressure on women to turn to transactional sex to augment family income.

At the request of the U.S. Agency for International Development’s Bureau of Economic Growth, Agriculture and Trade, economist Bruce Bolnick prepared this paper describing the economic impact of HIV/AIDS on seven areas of concern to the Bureau—trade and investment, growth, poverty, agriculture, education, economic opportunities for women, and the environment and natural resources—and reviewed multisectoral approaches to mitigating these impacts.