Select Committee on International Development Written Evidence


Memorandum submitted by CDC Group plc

  Having spoken to you recently regarding the inquiry into the impact of HIV/AIDS on developing countries social and economic development, I thought I would put together some of my own thoughts on this issue. I must emphasise that these are my own personal opinions and do not necessarily reflect the approach of CDC Capital Partners.

  I currently work in the Business Principles Group within CDC Capital Partners as the Occupational Health and Safety Specialist. The link between occupational health care and primary health care within our investee companies has led to me becoming more and more involved in the social and welfare aspects of particularly the managed businesses. Over the last three years, I have travelled widely in Africa and the Pacific Rim, and have spent a considerable amount of time visiting the clinics and hospitals that we run for our employees' use and, in many cases, for the community at large. Typically during a year, I will travel to Uganda, Côte d'Ivoire, Tanzania, Malawi, Zambia, Zimbabwe, South Africa, Swaziland, Papua New Guinea and Solomon Islands. Over the last year or so CDC has tried to get handle on the magnitude of the general disease problem within our areas of influence. We have set up a disease monitoring scheme, which reveals that our directly controlled clinics administered over 467,000 treatments to our employees and their dependants—bearing in mind that we only employ around 43,000 people. The burden on the business is clear. In the Pacific, each clinic visit costs the company around $1.20, without taking into account lost production and other indirect costs.

  We (as in CDC Capital Partners majority holdings) do not make a distinction between HIV-related disease and other diseases—we find it impossible, inappropriate, undesirable or all three. It is only one of the many chronic diseases affecting people living in developing countries, but it is undoubtedly a massive problem now and will become more so in the future.

  HIV is a disease affecting the immune systems of humans. It gradually reduces the body's ability to respond to infections or attacks by pathogens and once AIDS has developed in an individual then he or she becomes very susceptible to life-threatening opportunist infections. HIV is spread most commonly in developing countries through sexual contact. Infected women will, in approximately one-third of cases, transmit the disease to their babies. HIV can also spread to babies through the breast milk of their infected mothers. The prevalence of HIV in Africa alone is leading to an infection rate of around 13,000 people per day. However, throughout the world there is a level of ignorance about the disease and its causes that is astounding. Senior figures in multi-national organisations often have little grasp of the risks and of the way the disease is transmitted. In extreme cases, this can led to totally biased, unrealistic views that can have major negative impacts on investment decisions. At the opposite end of the labour spectrum, many people in Southern Africa are convinced that HIV/AIDS was part of a plot by the apartheid government to keep birth rates down. As I mention later in this paper, the key to defeating the disease is in removing this ignorance.

  The number of infected people is difficult to quantify properly because of the lack of reliable data, and because of the stigma attached to the disease and its sufferers. Mass HIV testing of the general population would raise all sorts of moral and ethical questions on confidentiality, reporting, anonymity, further treatment, and a whole range of other issues. Rates of infection are generally gleaned from presentations at clinics by pregnant females, or though screening of commercial sex workers. The results that are gained are subjected to modelling techniques that give a grasp of the magnitude of the problem. On the ground, clinic officers and nurses are loathe to classify any individual as suffering from an HIV-related disease. Our own disease records do not show any significant proportion of people presenting at the clinics with HIV-related illness. However, when asked, the clinic officers will shake their heads and say that they can identify those people suffering from HIV/AIDS simply by the patient's appearance. There is undoubtedly a connection between the number of recorded TB and pneumonia cases and the level of HIV infection in the general population.

  A great deal of work has been done in trying to quantify exactly the size of the HIV/AIDS problem. This is often not helpful—we know that there is a major catastrophe underway, and that it will roll on for years to come. UNAIDS and other funded studies initially projected that the infection rates would fall away after 2010 leading to a gradual decline in the incidence of the disease. Alan Lopez from the WHO in his publication The Global Burden of Disease indicates that new evidence indicates infection rates will continue to rise, decimating populations as they fall prey to AIDS well into the 2020s and beyond. Prevention of the disease will not, in my opinion, be countered by vaccination or other medical methods. The transmission rates may be reduced but the disease will not be eradicated. The sheer size of the increase in the population to be treated in Africa alone would outstrip the application of any foreseeable intervention methods. What we all need to realise is that a life expectancy of 42 years or less for the population of a country is not acceptable in the 21st century. The death rates from HIV/AIDS-related illnesses will continue to rise to the point where in many projections, the population growth will go into decline. The response to many of the questions on your paper are encapsulated in that bald statement—morale, investment, government wealth, development targets, productivity, mortality, drugs costs, and human rights in general will all be adversely affected for the next 20 years and beyond.

  Health education programmes are run by many governments and NGOs, but there is a certain amount of resentment amongst people especially to those schemes funded by bodies from outside their own borders. Mass communication of information in developing countries is not as simple as it is in the richer nations of the world. Television, radio, and newspaper campaigns do not reach the people who "need to know". This is all part of the divide between the "haves" i.e. us, and the "have nots" i.e. them. We tend to apply our complicated standards to a situation that cannot cope with them. What is the point of a TV campaign, such as is run by MTV, that reaches over a billion people on a regular basis, but in the wrong parts of the world? The great majority of the people who need to know and understand about the risks associated with unsafe sexual practices do not have running water, let alone power or the resources to buy TV receivers and radios. Their main concern is in growing enough food to survive, and to perhaps buy a few "luxury goods". The most effective method of communicating the problem to the masses is through the traditional peer group educators. The CHEP scheme in Zambia is a prime example of how this is done. CHEP, or the Copperbelt Health Education Programme, encourages local people to use their skills to act in plays or dance groups. They get the message across to the people in a way that is entertaining, but which contains very serious messages not only about HIV/AIDS, but also about cholera, STDs and parasitic infestations. The training of new educators is cascaded out to the population—in theory this means that there should be a wide coverage in a short time. As is the case with many other aspects of this epidemic however, funds are limited and so the effectiveness of the campaigns is restricted by lack of resources. Companies can contribute in this field, but their influence tends to be regional, if not just local. Most companies distribute, or make available, free or very cheap condoms to the workforce. Dispensers are being placed in easily accessible positions such as toilets, workshops, beer halls and other social centres. However, supplying these things does not guarantee that they will be used. There is a major cultural hurdle to overcome regarding the use of condoms, let alone other methods of family planning. Men are very likely to insist that a condom is not used resulting in the risks of transmission of HIV and other STDs being vastly increased, along with the chances of pregnancy. Women are reportedly often intimidated into having unprotected sex. The prevalence of sexually transmitted disease also leads to a massive increase in the likelihood of HIV transmission between partners because of the presence of wounds on the genitalia. Women are more likely to attend the health education sessions than men and there is generally a perception that men do not take a sufficient interest in the prevention of disease. People generally appear to acknowledge that HIV/AIDS exists but many are either in denial, don't care, or feel that the disease is something that is being touted by the developed world as a reason for less sex so that the population in the developing world is kept under control. This view may appear jaundiced, but in many ways is perfectly understandable.

  I find it particularly disheartening that the cost of the anti-retroviral treatments available in the developed countries is orders of magnitude higher than the annual income of a family in Africa. Treatment costs of $6,000 to $11,000 per individual, per year are not uncommon in the US and Europe. How can we reconcile that with a daily wage (if a person is in work) of around $1 per day? The majority of the victims are subsistence farmers or their families with no outside income. Can we expect the drugs companies, employers, and governments to pick up a rising bill that would be increasing at the rate of $150 million per week? I also get the feeling that if an effective cheap vaccination or treatment is developed by one of the multi-national researchers, the last place it would be used would be Africa or India. However, one of the most positive initiatives has been the development of Nevirapine, one of the anti-retroviral family. If this is given to pregnant women during and after labour then the likelihood of the disease being transmitted to the baby is reduced by, I believe, 30 per cent. The cost of this intervention is reported, as being between $3 and $5 per treatment, but it still has not spread widely to health providers.

  As far as industry and companies in the developing world are concerned, it is difficult to form an opinion on how they are commonly approaching the HIV/AIDS epidemic. Where the business is largely agriculturally-based, for example, in tea or coffee plantations, or other labour intensive industries, it is often very difficult for the company to grasp a true picture of the scale of the problem. Many companies use large number of unskilled, illiterate workers who are brought in for relatively short periods and who are then returned to their villages which may be considerable distances away. This gives rise to other aspects of the epidemic that companies actually contribute to. By bringing a mix of people into one central location, the disease can spread within the temporary community. Members of that temporary community become infected and then return to their homes where the disease is spread further. Succession planning and retraining of replacement workers is built into organisations but really only at the level of lower to middle management and clerical staff—mainly because the attrition rate is becoming more visible in this small population. Other aspects to consider are the costs of medical care for a person who has HIV and who will at some stage develop AIDS. Does the company need insurance to cover this? What happens regarding pension schemes? Is the company entitled to test an individual who they suspect of being infected and what would they do with the information if they had it? What testing methods can be used—saliva tests are non-invasive but cost money? This latter point returns to the medical confidentiality issue. Many of the CDC Capital Partners majority investments have chronic disease policies in place that address these issues on paper, but putting them into practice involves a great deal of soul-searching on the part of company management.

  The effects of HIV/AIDS on the economies of countries where large sectors of the population are affected are essentially two-pronged. At government level, the burden placed on health care provision and the cost of drugs and treatment facilities is high. At the level of the victims, the onset of the disease leads to a less effective individual. That individual is less able to carry out daily tasks such as water collection and other work because of the gradually debilitating nature of the disease. Once full-blown AIDS arises then the infected person becomes a burden to their family and the general community, as well as to the medical services, as they become less and less able to provide for themselves and their households. If the victim is the main bread-winner within a family, and that family is housed in a company scheme, then once the victim finally succumbs to the disease the family will no longer be able to live in that accommodation. They either return to their distant relations or squat near the larger conurbations.

  I feel that in general the world has developed an "out of sight, out of mind" approach to the level of HIV/AIDS infection in developing countries. The disease still has a huge stigma attached to it in the west—it is something that drug-users and homosexuals get, not "normal" people. We have to get over that before we are likely to make any real progress in raising awareness here, while in the worst affected countries the resources are so limited that the effectiveness of the intervention and education schemes is also severely strapped. Huge amounts of money are being pumped into finding a cure for this disease—if 10 per cent of that was diverted to education in developing counties it would be a far more positive use of the money. How about a levy on drugs companies for HIV/AIDS education in the developing world?

  I feel strongly that the west is "rearranging the deck chairs on the Titanic" as far as this is concerned. There are many good words or more proposals to go out and measure the size of the problem—that isn't what is needed. If you want to get a grasp on the magnitude of the situation, take a drive from Entebbe airport to the Uganda capital Kampala. You'll get to the coffin-making area where there are dozens of carpenters making a living from the deaths of many thousands. And too many of those coffins are very small . . .

  I hope you find this of use. As I said at the beginning it is my perspective, but if you have any other queries, please contact me.

Duncan Wall
Business Principles Unit, CDC Group plc
May 2000

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