Tanzania - AIDS assessment and planning study

Report No. 9825-TA Tanzania AIDS Assessment and Planning Study June 1992 Population and Human Resources Division M i' O1F I CHE 001 Y Southern Africa Department African Regional Office I,,rt. 1' . : it,u: 5 'I'A Ty: ( ;to) ) Tj . 1 1 Il JTh A,S'.-2MENT & l ANN r NI: ;'i .. Authloc: MURF1HY. JFAINNEPTE Ext- 34425 Roor J1 1 081 At)ep. A1 tl FOR OFFICIAL USE ONLY Document of the World Bank This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Unit = Tanzania Shilling (TSh) US$1.00 = TSh 193 (February 1991) ABBREVIATIONS AND ACRONYMS AIDS Acquired Inmunodeficiency Syndrome AIDSTECH Technical Intervention for the Containient of AIDS AMR Adult Mortality Rate ARI Acute Respiratory Infection AZT Azidothymidine, former name for zidovudine, a drug BCG Vaccine to protect from TB CCM Tanzania National Ruling Party (Chama Cha Mapinduzi) CDD Control of Diarrheal Diseases program DAC District AIDS Coordinator DANIDA Danish International Development Agency DSM Dar es Salaam EDP Essential Drug Program ELISA Enzyme-linked Immunosorbent Assay EPI Expanded Program for Immunization FLE Family Life Education GDP Gross Domestic Product GPA WHO's Global Program on AIDS GTZ German Government's international aid agency HEP Health Education Project HEU Health Education Unit HIV Human Immunodeficiency Virus HLY's Healthy life years IEC Information, Education and Communication IMR Infant Mortality Rate jUWATA Trade Union of Tanzania KABP Knowledge, attitudes, beliefs and practices MCH/FP Maternal Child Health/Family Planning MOH Ministry of Health MTP Medium Term Plan NACP National AIDS Control Program NGO Non-Governmental Organization ODA Overseas Development Administration PHC Primary Health Care SIDA Swedish International Development Authority STI) Sexually Transmitted Disease TAC Technical Advisory Committee of the National AIDS Task Force TB Tuberculosis TBA Traditional Birth Attendant UMATI Family Planning Association of Tanzania UNICEF United Nations Children's Fund USAII) United States Agency for International Development UWT National Women's Organization of Tanzania WAMATA Tanzanian NGO to assist people with AIDS WAZAZI Tanzanian Parents' Association WHO World Health Organization  FOR OMCIAL USE ONLY PREFACE The Tanzania AIDS Assessment and Planning Study was a joint undertaking of the Government of Tanzania, the World Health Organization (WHO) and the World Bank, growing out of discussions between Jonathan Mann (WHO) and Dean Jamison (Bank) in dhe late 1980s. The cost effectiveness framework was formulated by Mead Over, and the policy and implementation framework, by Jean-Louis Lamboray. The study comprised a series of desk and field studies (listed below) and a mission to Tanzania in April-May 1991 comprising Jealinette Murphy (senior operations officer and mission leader), Jean-Louis Lamboray (public health specialist), Richard Laing (public health consultant), Rami Chhabra (lEC consultant), Wendy Roseberry (pubiic health management consultant), Joy de Beyer (economist), and Larry Forgy (economist consultant). The report was drafted by Taryn Vian (consultant), drawing heavily on these background studies and on other references listed in the bibliography, and was finalized by Jeannette Murphy (task manager), following the main mission. Mead Over, Jean-Louis Lamboray and Martha Ainsworth contributed substantially to the study throughout its implementation. Professor Philip Hiza of the Ministry of Health coordinated Tanzania's participation; and invaluable assistance was prcvided by the National (Mainland) AIDS Control Program (NACP). Within WHO, Roy Widdus was responsible for overseeing the study, under the direction of Michael Merson. Within the World Bank, David de Ferranti and Stephen Denning were respectively the managing Division Chief and Department Director for this sector work. In its current form, the report reflects information available as of the end of December 1991. Background Studies 1. Chin, J. and Sonnenberg, F., "The Epidemiology and Projected Mortality of AIDS in the United Republic of Tanzania," WHO, Geneva, January 1991. 2. Bulatao, R., "The Demographic Impact of AIDS in Tanzania," draft mimeo, IBRD, Washington, D.C., June 13, 1990. 3. Cuddington, J., "Modelling the Macroeconomic Effects of AIDS with an Application to Tanzania," draft mimeo, Georgetown University, Washington, D.C., October 18, 1991. 4. Over, M. and Huq, M., "Economic Impact of AIDS on the Tanzania Economy," draft mimeo, IBRD, Washington, D.C., March 29, 1991. 5. Foote, D., "A Cost/Effectiveness Model for Comparing Interventions in Information, Education, and Communications about AIDS in Tanzania," Applied Communication Technology, Menlo Park CA, October 1990. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclesed without World Bank authorization.  6. Heald, G., "Estimating the Cost/Effectiveness of AIDS Information, Education and Communication Intorventions in Tanzania," on the basis of field work in November 1990, Communication Reeearch Center, Tallahassee FL, March 5, 1991. 7. Bjorkman, A., "Alternative Medical Interventions to Slow the Spread of HIV Infection," Karolinska Institute, Stockholm, January 1991. 8. Over, M., "Costs and Effects of STD Treatment as a Strategy for AIDS Prevention in Tanzania," on the basis of field work in November 1990, IBRD, Washington, D.C., February 12, 1991. 9. Over, M., "Costs and Effects of Blood Screening and Social Marketing of Condomis as Strategies for AIDS Prevention in Tanzania," on the basis of field work in November 1990, IBRD, Washington, D.C., April 10, 1991. 10. Laing, R. and Pallangyo, K., "Background Study on Alternative Approaches to Managing the Opportunistic Illnesses of HIV-Infected Persons: Costs and Burden on the Tanzanian Health Care System," on the basis of field work in August 1990, Management Sciences for Health, Boston, September 1990. 11. Bertozzi, S., Ankrah, M., Koda, G., Ngaiza, M., "Tanzania Assistance to Survivors of the AIDS Epidemic, a Review of Policy Options," on the basis of field work in March 1990, mimeo, IBRD, Washington, D.C., June 16, 1990. 12. Ainsworth, M. and Rwegarulira, A. "Coping with the AIDS Epidemic in Tanzania: Survivor Assistance," IBRD, Washington, D.C., December 1991.  DEFINItIONS' AIDS Acquired Immune Deficiency Syndrome, a syndrome characterized by unusual opportunistic infections and rare malignancies in otherwise healthy individuals with no other reason for immune system compromise Case Fatality Rate Percentage of deaths due to a disease among the total number of people who have contracted the disease Child Mortality Rate Probability of dying between ages 1 and 5 Crude birth rate Number of births per 1,000 population in one year Crude death rate Number of deaths per 1,000 population in one year Dependency Ratio Population aged less than 15 and over 64 ("dependent population") divided by the population aged 15 to 64 ("productive population") HIV Human Immunodeficiency Virus, a retrovirus that causes the underlying damage to the human immune system which then permits opportunistic infections to cause virulent and fatal diseases in the HIV infected individual Incidence Number of new cases of a given disease which occur in a population during a specified period of time Incidence Rate Incidence expressed per specified unit of population (usually expressed as the number of cases per 1,000 persons) Infant Mortality Rate The number of deaths to infants (children under age one) in a given year per 1,000 live births in that same year Opportunistic Infections The many parasitic, bacterial, viral and fungal infections which are able to cause disease in an individual once the human immunodeficiency virus has damaged the immune system. These are the most common presenting clinical manifestations that establish a diagnosis of Sources: World Bank 1989, Volberding 1988, Center for International Health Information 1990, MacMahon 1970, UNICEF 1990.  AIDS, and are characterized by an aggressive clinical course, resistance to therapy, and a high rate of relapse. Prevalence Frequency of a given disease at a designated point in time Prevalence Rate Proportion of a specified population which exhibits the disease at a specified time (often expressed per 1,000 persons or, in case of low figures, per 100,000 persons) Progression Rate Time from HIV infection to development of full-blown AIDS, sometimes expressed as the proportion of HIV infected individuals who will develop AIDS within a specified time period Seroincidence Number of cases whose blood shows evidence of antibodies to a given infectious agent during a specified period ot time Seroincidence Rate Seroincidence expressed per specified unit of population Seroprevalence Frequency of cases whose blood shows evidence of antibodies to a given infectious agent at a designated point in time Seroprevalence Rate Proportion of a specified population whose blood shows evidence of antibodies to a given infectious ageni ai a specified time Total fertility rate Average number of children that would be born alive to a woman during her lifetime given current age- specific fertility rates Under Five Mortality Rate The probability of dying between ages 0 and S  TABLE OF CONTENTS EXECUTIVE SUMMARY i-xx INTRODUCTION I A. BACKGROUND I B. COUNTRY SETING 2 C. HEALTH STATUS AND HEALTH SYSTEM 2 - Morbidity 2 - Mortality 4 - Health System and Policies 6 nI. THE AIDS EPIDEMIC 9 A. CURRENT SITUATION 9 1. Data and Methods 9 2. Number of Cases, Infections and Deaths 10 - AIDS Cases 10 - Deaths from AIDS 12 - HIV Infection - 13 3. Distribution by Region, Gender, Age and Socio-Economic Status 16 - Geographic Distribution 16 - Gender and Age Distribr.tion i8 - Distribution by Socio-economic Status 19 - Prevalence Estimates by Special Risk Group 19 B. ROUTES OF TRANSMISSION AND ASSUMPTIONS REGARDING PROGRESSION 20 1. Major Transmission Routes 20 - Heterosexual 21 - Perinatal 21 - Blood Transfusion 22 - Contaminated Needles and Instruments 24 - Other Routes of Transmission 25 2. Assumptions Regarding Disease Progression 25 - Progression from HIV Infection to AIDS 25 - Progression from AIDS to Death 26  C. FUTURE DEVELOPMENT OF THE EPIDEMIC 27 1. Projections of Infections, Cases, Deaths and Distribution 27 - Infections and Cases 27 - CumulAtive Deaths 30 - Changes in Distribution 32 2. Impact on Mortality 33 - Crude Death Rate, IMR and Life Expectancy 33 - Empirical Data on HIV Prevalence and Mortality 37 3. Impact on Fertility 39 4. Migration 41 - Effect of Migration on AIDS 41 - Effect of AIDS on Migration 41 5. Population Size, Growth and Distribution 43 HI. CONSEQUENCES OF THE EPIDEMIC 48 A. MACRO-ECONOMIC IMPACT OF AIDS 48 - Introduction 48 - AIDS' Channels of Macroeconomic Influence 48 - A Simple Analytical Model 52 - The Simulation Results 53 B. IMPACT ON PUBLIC EXPENDITURES AND SERVICES 59 1. Health Services 59 - Impact on Health Care Delivery 59 - Cost of AIDS Care 64 2. Education Services 67 - Impact on Cohort Size 68 - Teacher Numbers, Turnover, and Training 69 - Impact on Quality and Efficiency of Education System 69 - Lost Investments in Education 69 - A Lower Demand for Education? 70 3. Impacts on Other Scawrs 70 C. IMPACT ON HOUSEHOLDS AND COMMUNITIES 71  IV. PREVENTING FUTURE HIV INFECTION 74 A. COSTS AND EFFECTS OF SELECTED INTERVENTIONS 74 1. STD Prevention and Control 74 - Effectiveness of STD Treatment 75 - Costs 82 - Cost-Effectiveness Estimates 84 - Implications for Policy Decisions 86 2. Condom Promotion 87 - Availability 88 - Use 89 - Costs 89 - Effectiveness of Condom Promotion and Distribution Programs 90 3. IEC and Counselling Activities 94 - Costs 95 - Effects 97 - Relative Costs, Effects and Cost-Effectiveness Ratios 97 - Implications for Policy Decisions 100 - Comment 102 4. Blood Screening 103 - Costs 103 - Effectiveness 104 5. Reduction in Blood Transfusions 106 - Use of Replacement Solutions 106 - Malaria Chemotherapy and Chemoprophylaxis 107 6. Possible Vaccine Development 109 V. COPING WITH THE AIDS EPIDEMIC 111 A. MEDICAL TREATMENT FOR PERSONS WITH AIDS 111 1. Treatment Options for Opportunistic illnesses 111 - Defining Treatment Objectives 112 - Defining Alternative Treatment Options 112 2. Episodes of Illness Per Case 113 3. Costs of Treatment 114 - Treatment Protocols and Cost Assumptions 114 - Cost Per Episode of Illness 115 - Cost Per AIDS Case 115  - Cost Implications of Alternative Treatment Scenarios 118 - Methodological Considerations 123 B. SURVIVORS 124 1. Growth in Numbers of Orphans and Other Dependent Survivors 124 - Numbers of Child Orphans 125 - Orphan Rates and Age of Child 125 - Orphan Rates and Adult Mortality 127 - Excess of Orphans Attributable to AIDS Epidemic 128 - Numbers of Widows, Widowers and "Elderly Orphans" 130 2. Survivor Assistance Programs 130 - Criteria for Selection of Alternatives 131 - Analysis of Options 131 - Implications for Policy Decisions 134 VI. THE NATIONAL AIDS CONTROL PROGRAM (NACP) 136 A. ESTABLISHMENT OF THE NACP 136 1. Background 136 2. NACP Organization 136 B. PROGRAM ACTIVITIES TO DATE 137 C. STD PREVENTION AND CONTROL 138 1. Efforts to Date 138 2. Planned Activities 139 3. Condom Promotion and Distribution 139 D. IEC INTERVENTIONS 1AO 1. Resources Available 140 2. Activities to Date 140 3. Effectiveness of IEC Efforts 141 4. Future Directions 141  E. ISSUES/RECOMMENDATIONS 142 1. Give the NACP the Status it Needs to be a Truly National Program 142 2. Concentrate NACP's Efforts on Recognized Priority Areas 142 3. Undertake an Aggressive National STD Prevention and Control Program 143 - Essential Elements 143 - Costs 145 4. Strengthen IEC for AIDS prevention 145 - A Communication Plan 145 - The IEC Unit within NACP 146 - AIDS Technical Committees 146 - Decentralization of IEC 147 - More Effective Electronic Software Development 147 - Development of a Multi-Media Campaign on AIDS 147 - Film Development 148 - More Emphasis on Youth 148 - Condom Promotion 149 S. Strengthen Intra-Sectoral Coordination within MOH 149 6. Strengthen Donor Coordination 151 7. Decentralize AIDS Planning 151 VII. RECOMMENDATIONS 153 BIBLIOGRAPHY 155  LIST OF TABLES 1.1 Disease Frequency in Sentinel Dispensaries, January 1984 - August 1987 3 1.2 Comparative Mortality Indicators, Tanzania and Neighboring Countries 5 1.3 Morbidity and Mortality Statistics, Diarrheal Diseases and Acute Respiratory Infections (ARI) 6 1.4 Total Health Facilities by Region and Management, Mainland Tanzania, 1988 7 1. 1 Seroprevalence in Blood Donors, by Region, 1987-1989 14 11.2 Cumulative Seroprevalence in Blood Donors by Region, 1990 15 II.3 Recent Estimates of HIV Seroprevalence Among Selected Risk Groups 20 1.4 Cumulative Percentage of HIV Infected Persons Who May Progress to AIDS Within a Given Period of Time From Infection, Adults and Infants 26 11.5 Cumulative Percentage of Persons with AIDS Who May Die from AIDS Within One and Two Years of Diagnosis, Adults and Children 26 11.6 Estimated Incidence and Prevalence of HIV in Mainland Tanzania 28 11.7 Projected Cumulative AIDS Cases and Deaths in Tanzania, All Ages 31 II.8 Changes in Mortality Indicators with AIDS by 2005-10, As Compared to Base Projections Without AIDS 35 11.9 Effect of AIDS on Fertility: Projected Change in Proportion of Women of Child-bearing Age by the Year 2020 40 HI. 1 Results of Simulation Modelling Macroeconomic Effects of AIDS in Tanzania 54 111.2 Output Projection: No-AIDS Scenario 55 111.3 Output Projection; With-AIDS Scenario (15% Monogamy) 56 M.4 Days of Care, By Episode and Treatment Setting, Adult AIDS Cases 61 111.5 Days of Care, By Episode and Treatment Setting, Pediatric AIDS 62 Cases 111.6 Estimated Costs of AIDS Treatment, 1991 65 III.7 Projected Expenditure for Treatment of AIDS Cases, No Resource Constraint 65 I.8 Projections of School-Age Cohorts 68  II1.9 Projected Teacher Needs for 34:1 Pupil:Teacher Ratio 69 m. 10 The Economic Impact of Adult Fatal Illness on the Household 72 IV. 1 Dynamic Effects on STD Transmission of Preventing 100 STD Cases in Core and Noncore Groups 78 IV.2 Discounted Healthy Life Years Saved Per Case Prevented or Cured When Epidemics are Independent: Core Vs. Non-Core 78 IV.3 Dynamic Effects on HIV Transmission of Preventing 100 STD Cases in Core vs. Noncore Groups. 80 IV.4 Discounted Healthy Life Years Saved Per Case Prevented or Cured When STDs Affect HIV Transmission: Core Vs. Non-Core 81 IV.5 Average Cost per Treatment of an STD Case 82 IV.6 Minimum Cost Per Effectively Treated Case of STDs: Sensitivity to Prevalence Rate and Diagnostic Procedure 83 IV.7 Cost Per Discounted Case of HIV Averted by STD Treatment: Sensitivity to Prevalence Rate and Core Vs. Non-Core Strategy 84 IV.8 Cost Per Discounted Healthy Life Year Saved by STD Treatment in the Presence of an HIV Epidemic: Sensitivity to Prevalence Rate and Core Vs. Non-Core Strategy 85 IV.9 Average Cost per Year of Protecton for a Condom Social Marketing Program in Tanzania 92 IV. 10 HIV Infections Averted Over Ten Years When 100 People Use Condoms for All Contacts for One Year 93 IV. 11 Cost-Effectiveness of Social Marketing Campaign to Induce 100 People to Use Condoms for All Contacts for One Year 94 IV.12 NACP IEC Costs (Total and Distributed Across Major IEC Activities/Media 96 IV. 13 Estimated Relative Cost/Effectiveness of Alternative IEC Interven.ions in Averting New HIV Infections (Intermediate Estimates) 98 IV. 14 Estimated Relative Cost/Effectiveness of Alternative IEC Interventions in Averting New HIV Infections (Optimistic Estimates) 98 IV. 15 Estimated Relative Cost/Effectiveness of Alternative IEC Interventions in Averting New HIV Infections (Pessimistic Estimates) 99 IV. 16 Summary of Relative Costs, Effects and C/E Ratios, IEC and Counselling 100  IV.17 Cost-Effectiveness of Anemia Prevention through Malaria Treatment and Prevention 109 V. 1 Average Number of Episodes of Opportunistic Illness per AIDS Case, Adults and Children 114 V.2 Costs per Episode of Opportunistic Illness Adult and Child AIDS Cases 116 V.3 Average Lifetime Cost per AIDS Case, Adults and Children 116 V.4 Days of Care, by Episode and Treatment Setting, Adult AIDS Cases., Decentralized Referral System 118 V.5 Days of Care, by Episode and Treatment Setting, Pediatric AIDS Cases, Decentralized Referral System 119 V.6 Implication of Alternating Treatment Scenarios on Cost per Case 120 V.7 Implications of Alternative Treatment Options on Total Direct Costs, 1990 122 V.8 Summary of Estimated National AIDS Treatment Costs in 1990 Under Alternative Treatment Scenarios 123 V.9 Estimated Proportion and Number of Orphans in Twenty Regions under Pour Scenarios, 1988 126 V.1 0 Analysis of Survivor Assistance Options 132  LISI OF FIGURES B. 1 Estimated Cumulative AIDS Cases, Adults and Children 12 11.2 Estimated HIV Prevalence Among Sexually Active Adults, Tanzania, 17 1989 11.3 Age Distribution of Reported AIDS Cases, Mbeya Region, Tanzania 18 A.4 Estimated Number of New HIV Infections Among Adults in Mainland Tanzania 29 11.5 Estimated Number of New HIV Infections Among Children in Mainland Tanzania 29 11.6 Estimated Cumulative AIDS Cases, Paediatric and Adult, in Mainland Tanzania 30 11.7 Cumulative AIDS Cases and Deaths 31 11.8 Annual New Adult HIV Infections, By Sex 32 11.9 Percent of Adult Males and Females Infected with HIV 32 11.10 Crude Death Rate (per thousand) 34 1.11 Infant Mortality Rate (per thousand) 34 11.12 Life Expectancy at Birth 34 11.13 Projected Change of Child Mortality due to HIV/AIDS in Tanzania 36 11.14 Projected Increase in Adult Mortality due to HIVIAIDS in Tanzania 36 11.15 Adult Mortality Rate, Twenty Regions of Tanzania, 1988 38 11.16 HIV Prevalence and Adult Mortality: Kagera Region, 1987-1988 39 11.17 Population Growth Rate Under Different Scenarios (percent) 43 lI.18 Total Population Under Different Scenarios 44 11.19 Dependency Ratio Under Different Scenarios 45 11.20 Youth Dependency Ratio, With and Without AIDS 46 11.21 Elderly Dependency Ratio, With and Without AIDS 46 11.22 Age Distribution in 2020, With and Without AIDS 47  iI. I Working-Aged Population, 1985 - 2010 50 111.2 Average Age of Labor Force, 1985-2020 51 I11.3 GDP Projection, with and without AIDS 57 11.4 Per Capita GDP Projection, with and without AIDS 57 m1.5 Capital to Labor Ratio Projection, with and without AIDS 58 mI.6 New Tuberculosis Cases in Tanzania, 1981-1989 63 111.7 Projected AIDS Treatment Costs Versus Available Public Funding (scenario 1) 66 111.8 Projected AIDS Treatment Costs Versus Available Public Funding (scenario 2) 66 111.9 Projected AIDS Treatment Costs Versus Available Public Funding (scenario 3) 67 IV. 1 Static Benefit of Preventing a Case of STD and Other Diseases in Sub- Saharan Africa 77 IV.2 Dynamic Benefit of Curing or Preventing 100 Cases of Gonorrhea in the Core vs. Non-Core Groups 79 IV.3 Total Health Benefit of Averting a Case of STD when STD's Exacerbate HIV Transmission: Core vs Noncore 82 IV.4 Cost per HIV Infection Averted by Blood Screening as a Function of Prevalence Rate and Test Cost 105 V.1 Contributions of Opportunistic Illnesses to AIDS Treatment Costs 117 V.2 Orphan Rates by Age Group, Six Regions of Tanzania, 1988 127 V.3 Adult Mortality and Orphan Rates, Six Regions of Tanzania, 1988 128 V.4 Orphan Rates and Adult Mortality, Kagera Region, 1987-88 129  EXECUTIVE SUMMARY OVERVIEW AND INTRODUCTION The rapid spread of AIDS will have far-reaching implications in Tanzania over the next several decades. This study assesses the current status, likely future development, and prospective demographic, economic, and other impacts of the AIDS epidemic, and examines the options available for doing something about it. The findings suggest that the epidemic will be severe and have major consequences. As will be described further below: - The number infected will reach 5.8 to 17.4 percent of the population by the year 2010, up from 1.4 to 5.3 percent currently. (These HIV-infected individuals will suffer debilitating illness, usually within one to ten years of infection, followed by certain death a year or two later, often in the prime of life or before.) In addition, a much larger number will be indirectly affected: as relatives, many of whom will incur significant costs on account of AIDS victims; as survivors, many of whom will be left in greater poverty; as earners, employers, or self-employers who will experience productivity losses; or as sufferers of other diseases in AIDS-induced resurgence (e.g., tuberculosis). - Demographic changes will alter the composition of the population and work force. Earners will have more dependents to provide for, as the ranks of working-age adults are thinned by rising mortality, while the young and the infirm become more numerous. The work force will become younger (average age 29 instead of 31 in 2010) and less experienced, and will have less education and training. Critical talents and rare skills - such as entrepreneurs, managers, and various professionals - will become even scarcer. - The economy will be adversely affected, mainly in the medium and long run. GDP will grow more slowly; 'ly 2010, it could be 14 to 24 percent lower than it would have been if there had been no AIDS epidemic. Per capita GDP also will be impacted, but more moderately, as the slower aggregate GDP growth is partially offset by slower population growth. - Some sectors, industries, regions, and subgroups will feel the effects much more than others. Kagera region, the worst hit area so far, will experience massive increases in mortality rates and unattached dependents (orphans, widows, etc.). It is already feeling the labor pinch, with crop production reportedly being adversely affected. Other regions may be similarly effected. Health services and budgets will come under increasingly intense pressure, as AIDS victims and other patients compete for the limited resources available. - Population growth, though slowed considerably by higher mortality, wil remain above 2.0 percent through 2010 or longer, and the dependency ratio will worsen slightly; population policies and programs, including family planning, will continue to be an urgent priority.  - ii - The findings also indicate that effective action to slow the spread of the disease and improved coping measures X make a difference in mitigating the course and consequences of the epidemic. The most promising options are strengthening efforts to: - curb ith: sexually transmitted diseases (STDs) better, since their presence significantly increases the likelihood of AIDS transmission. Not only would a comprehensive STD/HIV prevention and control program decrease the risk of HIV infection for those with treatable STDs, it presents a unique opportunity for reaching those individuals at greatest risk of acquiring and spreading HIV with effective AIDS counselling; - increase condom usage, by actively promoting them for disease prevention as well as family planning purposes and by ensuring their ready availability; - design a variety of EEC messages specifically targetted to different audiences and utilizing a wide variety of media in order to create the synergistic effect necessary to change behavior; - reduce the need for blood transfusions (e.g., by improving prevention and treatment of other diseases - such as malaria - so that fewer patients reach the point of needing transfusions); - treat AIDS patients at primary facilities and at home rather than at hospitals, and thus realize significant cost savings. In addition, the adverse economic impacts can be moderated through actions to: - intensify public expenditure review and control, with a view to raising allocations to the health sector through reductions elsewhere, while also diminishing inefficiencies within the health system; - pursue vigorously the economic reform, so that the full growth potential of the economy can be realized; and - seek increased external funds, through donors and commercial investors, to compensate for the reduced domestic savings caused by AIDS. AIDS has come to Tanzania at a difficult time. Economic conditions and living standards (including health status) are still at very low levels, recovering from the setbacks of the early 1980s that reversed progress in the 1960s following independence. GNP per capita is about $100, and public spending on health per capita is under $4. Morbidity and mortality levels are unacceptably high. One out of every ten children born does not survive to its first birthday. More than three of every 1000 mothers-to-be die as a result of their pregnancy. The child mortality rate (prior to AIDS) was 147/1000 and the adult mortality rate, 7/1000, with an average life expectancy of about 48 years.  - iii - EXTENT AND SEVERITY OF THE EPIDEMIC Cuffent Situation The National AIDS Control Program (NACP) estimates that about 800,000 people, or about 3.2 percent of the population, are currently infected with the disease (i.e., are HIV sero-positive). Of these, approximately 160,000 have already developed AIDS (i.e., have crossed the threshold from being infected to being ill). The remainder will develop AIDS sometime between less than one and up to twenty years from the date of infection (the median time for adults between infection and becoming ill appears to be eight to ten years in developed countries and may be less in developing countries). Death follows within a year or two of the onset of major symptoms, and often much sooner. Annual deaths from AIDS are presently estimated at between 20,000 and 30,000 which is 5-7 percent of total deaths. AIDS is believed to have recently surpassed malaria as the leading killer among diseases in adults, and is likely to do so for children in the very near future. Some parts of the country are much more affected than others. For example, in Kagera region, where the epidemic first manifested itself in Tanzania, reported AIDS deaths are about 16 percent of all deaths - and the actual figure may be higher due to underreporting. An estimated 17 percent of Kagera's urban population and 5 percent of its rural population are HIV infected; the proportions of productive adults infected is even higher. In contrast, in at least half of mainland Tanzania's 20 regions, only about 2.5 percent of the urban population and less than 1 percent of the rural population are thought to be infected. Whether these differences suggest different epidemics or different points in the same epidemic (i.e., whether all regions are likely to follow the Kagera pattern) is not yet known. This will depend on whether there are differences among regions with regard to the extent of sexual activity outside marriage and the prevalence of STDs in the populations, but information on these factors remains sketchy. There are also large disparities across different subgroups of the population. HIV infection levels are highest in people between the ages of 15 and 45, and in new-born infants. HIV infection rates are increasing especially rapidly among adolescents. Women and men are about equally infected. Women appear to become infected at a younger age than men on average. These facts are consistent with what is known now about how the disease is transmitted in Tanzania. By far the most important transmission route is heterosexual contact, which is estimated to account directly for close to 80 percent of all infections in the country. Blood transfusion and perinatal transmission have each been responsible for about 10 percent of infections; contaminated needles or other health care equipment is responsible for only 1-2 percent of infections; and transmission by other routes is negligible. This implies that those most at risk of acquiring AIDS are people with multiple sexual partners, their spouses and their unborn children. Future Prospects The likely future course of the epidemic will depend crucially on a number of vital and difficult-to-predict variables. By far the most important issue is what will happen to sexual behavioral patterns, and in particular, to the proportion of the adult population with multiple sexual partners. If, for example, both partners in 45 percent of married couples are "sexually monogamous", it has been estimated that, by the year 2000, about 1.2 million  - iv - people will be carrying the virus and another 450,000 will have died of AIDS, with these numbers growing to about 2.3 million and 1.7 million respectively by the year 2010. If, on the other hand, only 15 percent of married couples are mutually monogamous, as many as 3.6 million could be infected by 2000 and AIDS deaths could be as high as 1.6 million, growing to 6.1 million infected and 5.6 million deaths by 2010. These figures imply that 3.9 to 12.4 percent of the population will be infected by 2000 and 5.8 to 17.4 percent by 2010. Even if massive efforts to reduce the spread of infection were successful in slowing transmission, the number of AIDS cases and deaths would still increase for the next several years as those already infected reach the stage of actually falling ill with the disease. In the extreme (and unlikely) case that transmission stopped completely as of today, the number of AIDS cases would still continue to grow to over 300,000 by 2000, and to more than 500,000 by 2010. Thus, no matter what happens, AIDS is going to have a major presence in Tanzania for many years to come, and the Government must plan now how to deal with that reality. IMPACTS OF THE EPIDEMIC The increases in both mortality (deaths caused by AIDS and by AIDS-induced growth in the prevalence of other diseases) and morbidity (illness - i.e., decline in healthiness - among those afflicted) will have a wide range of impacts, affecting in particular (1) demographic factors (population growth, age structure, dependency ratios, etc.), (2) the economy, (3) the health care system, and (4) other sectors. Impacts on Demographic Factors AIDS is expected to increase the adult mortality rate to about 25/1000 by 1994, from about 7/1000 in the late 1980s. The child mortality rate, which has been decreasing steadily for the past twenty years, is likely to begin increasing again within the next few years. Overall, the crude death rate could increase to as much as 24/1000 (from 20/1000 currently) and average life expectancy could drop to about 40 years (from 48). Population growth will remain positive, but the M of growth could decline from the current 2.8 - 3.0 percent annually to 2.0 - 2.6 percent by the year 2010. Thus, population growth pressures will still be a major problem, and concerted efforts to improve and expand ropulation policies and programs, especially family planning, will continue to be an urgent and high priority. Most of the epidemic's effect on population growth will be from increased mortlity; the impact on fertility is anticipated to be minimal. The age structure of the population will change in several ways. The 15-to-64 age group, i.e., working age adults, will become younger overall: their average age will decline to 29, instead of 31.5 in the absence of AIDS. The under-15 age group will be somewhat smaller than it would have been otherwise, due mainly to deaths of AIDS infants; but will have the same age composition. Because the losses in the under-IS group will be relatively fewer than the losses in the 15-64 group, the under-15 group will account for a larger proportion of the 0-64 population in the with-AIDS case than in the without-AIDS case. Thus the youth dependency rate will rise. The over-64 group will initially be unaffected; later, as the losses in the 15-64 group work their way up the age pyramid, the over-64's will be significantly reduced in number, compared to the no-AIDS case. These trends, together with the reduced size of the 15-64 group, will cause the elderly dependency ratio to be  initially higher than it would have been, and then to be much lower. The overall dependency ratio, taking into account all these factors, will be slightly higher than in the absence of AIDS. In sum, the epidemic will lead to a younger (and therefore presumably less experienced) work force with a larger number of dependents to provide for. Significant increases will occur in the numbers of "unattached dependents' - orphans, widows, and families without able-bodied, working-age adults. In Kagera, there are a number of households consisting exclusively of dependents - young children and their grandparents. This development will impose extra burdens on others, including non-AIDS households, communities, and public authorities, as some victims move in with relatives and others become homeless scavengers. Impacts on the Economy The effects of the epidemic on mortality, morbidity, and demographic factors will affect the macroeconomy through multiple channels, starting with impacts on: - the labor force (the number of workers and potential workers, the age structure, the level of experience, the extent of training, etc.) and the dependent population (their number, needs, etc.) - the productivity of workers, as those who are ill, or caring for others who are ill, become less productive than if they were well - the human capital embodied in the work force, as well-trained, educated, experienced, and/or specially talented workers become less productive and die sooner than they would have otherwise. - expenditures occasioned by AIDS, including both public and private spending, at the individual household level and in aggregate.1' Flowing from these various effects will be others concerning the savings behavior of households and their non-AIDS-related spending. As victims, relatives, friends and others spend more on AIDS-related expenses, and as some of them also earn less because they work less, they will have fewer resources left for other purposes. This will undoubtedly result in a reduction in saving (or, equivalently, an increase in dissaving among those already spending more than their income). There may also be some reduction in expenditure for items unconnected with caring for victims, and possibly shifts in the composition of expenditure and saving. In addition, expenditure and saving behavior may be affected for other reasons too. For example, there may be an impact on the precautionary demand for savings by households who experience greater income variability in the presence of AIDS. 11 Expenditures on health services, though perhaps the main item here, will not be the only one. Households may incur many kinds of other "costs of caring" as well. In the end, too, there will be funeral expenses, which in Africa can often be extremely large relative to income.  - vi - The effects on savings are especially important because economic growth prospects will be modified to the extent that savings - and investments -- are altered. In the likely event that the dominant effect on saving is the impact of increased spending to care for AIDS victims, the outcome will be a decline in saving. Other effects on saving might mitigate or exacerbate this decline, but the net result seems more probably to be a reduction. The effects on expenditure unrelated to AIDS may involve numerous adjustments across different markets. Some of these adjustments may be quite ordinary, in the sense of being little different, in their economic consequences, from the usual market shifts associated with changes in weather, tastes, external factors, etc. But a few may be of a more special nature. One might be a reduction in spending on education. If, as a consequence of spending more on health care and other things, people spend less on their children's schooling (and thus enrollments fall, dropouts rise, and learning achievement declines), the resulting setbacks in investment in human capital could constrain long term future growth. Taking all these effects together, and some further ramifications they may have, the study examined a number of basic questions about the possible economic implications of AIDS, including the following. Will the implications amount to much, or will they be minor? If more than minor, how will the time path of key macroeconomic variables (GDP, GDP per capita, saving, investment, real wages) in the AIDS-stricken economy differ over the next twenty or so years from what would have happened in the absence of the AIDS epidemic? To what extent can policy interventions alter the "with AIDS" outcomes? To analyze these issues, a simple conceptional framework was developed, and then extended to motivate a more involv;J simulation model that links conjectures about the demographic impacts of AIDS to the macroeconomy. Using two extensions of a well-known approach (the Solow growth model) and simulations that trace out the time paths of a "no AIDS" scenario and alternative "with AIDS" scenarios reflecting different policy options, the analysis considered how the various effects would interact with one another. Of particular interest were the conflicting influences of declining labor force growth, labor productivity, and national saving. Taken together, these and the other effects of AIDS might result in either increases or decreases in GDP per capita, the capital/labor ratio, wages, and other variables. The simulations suggest answers to these questions and indicate the likely magnitude and direction of key changes over time. The main results of this analysis suggest that if no new actions are taken (e.g., if no new Government measures or donor support are forthcoming), then: - GDP would grow more slowly than it would have in the absence of AIDS. The average real GDP growth rate through the year 2010 would be 2.9 - 3.4 percent, instead of 4.0 percent if there were no AIDS. By the end of that period, the level of real GDP would be 14 to 24 percent lower than it would have been otherwise. - Per capita GDP would also be affected but more moderately, as the impact of slower GDP growth is offset somewhat by slower population growth. The average real per capita GDP growth rate through 2010 would be 0.3 - 0.7 percent, instead of 0.7 percent in the absence of AIDS. Under some scenarios, it is possible that per capita GDP might remain unchanged, especially if the reduction in savings were small or nil.  vii - - Capital/labor ratios would be affected slightly - possibly rising marginally more than it would have otherwise, as employers use non-labor inputs more so as to compensate for the losses In the numbers and productivity of workers. The time paths of these impacts are traced In the following figures for one of the simulation scenarios found to be among the most plausible, among the large number analyzed. Not surprisingly, the impacts start out as quite modest, but then build up over time as the prevalence, mortality, and morbidity from AIDS worsens. GDP Projection Ito, so - 70 s.o 40 0No &AM mb + Mo7d Uw Per Capita CDP Projection 2-2. 2.10 2 torn tom1 tifi torn t0 I rod un uIrd O Na Am * t~9  - viii - Capital to Labor Ratio Projection Tat lam 1 ....... .