Launching of the Guyana Business Coalition on HIV/AIDS

Winning the battle against HIV is an imperative. It’s a battle where the only option is to win. This is a daunting task and we must optimally utilize every tool, every weapon, and any strategy at our disposal to mount a battle that makes victory inevitable. One of the essential ingredients in the frontal attack on HIV is partnership. Not only is partnership essential, it is crucial and indispensable in our march against HIV.

Even in developed countries, creating partnerships and making them work are challenges, which most of the time prove too overwhelming for the potential partners. But in Guyana, as we pursue partnerships for better health for our nation and for our sisters and brothers, we have been able to overcome many difficulties and forge strong partnerships for health. I believe when it comes to partnership, no sector has advanced as far as the health sector in nurturing and strengthening partnerships and in extracting as much benefits from such collaborative arrangements.

Competition is essential in any society. The business community inherently is one in which competition occupies centre stage and the goal is often to ensure one business has the competitive edge over the other. Sometimes this takes the form of friendly competition. Other times, this takes the form of adversarial existence. But we can harness the energy that makes competition click to ensure health programs are driven. We can transform the zeal of competition to serve as catalysts for behavior adjustments and for mobilization for health for all.

Let me immediately congratulate the Guyana Business Coalition on its launching this morning. I am confident that the Guyana Business Coalition would deliver on its mandate and be counted as one of the vibrant business coalitions in the Region.

The event of the launching of the Guyana Business Coalition is an example of the dynamic and diverse kinds of partnerships we have been able to nurture in our country. It is one of the reasons I am so confident in saying to you, in saying to the citizens of Guyana, we are going to successfully confront HIV.

This coalition has been born out of the need to forge a national coalition, a national partnership to fight HIV. But I would hope the Guyana Business Coalition accepts that HIV is only one of the many challenges in health we face and that the coalition will work to ensure the health and welfare of their employees are high priorities everyday in their overall mandate.

No pandemic before HIV has had the potential to affect the socio-economic conditions of a country and of the globe as HIV. The economic and social costs of HIV can be colossal. The Business Coalition, therefore, must be cognizant of this fact. The economic well-being of private enterprise is overwhelmingly dependent on the social conditions, such as levels of education and health of the population, and the macro-economic conditions existing in the country. While other pandemics have caused socio-economic deterioration, I am unaware of any that have had the potential to cause as significant upheavals as HIV.

HIV has shown its propensity for affecting the macro-economics of a country. Any analysis of HIV and its impact on the economy of a country would show its potential for interfering with the channels of growth and development. There are ample examples around the world of the potential of HIV to disrupt economic growth, to affect production and to cause upheavals in the macro-economic stability of countries.

It was predicted in 2001 that given the trajectory of the epidemic at the time, countries like Guyana, Trinidad, Jamaica, Suriname would experience about a 5% contraction in their overall labor supply because of serious illnesses and deaths due to AIDS. This has not happened in Guyana because Guyana responded aggressively, demonstrating that the potential of HIV to affect the economy is not inevitable and can be mitigated. Guyana changed the trajectory of the HIV epidemic in our country. I have often provided evidence to show the change in trajectory of the HIV epidemic in our country. I would not repeat the data at this time.

The Business Coalition must be aware of this important factor and must see its participation in this partnership not merely from the feel-good view of a strictly charitable spirit prevailing, but from the bird’s eye view of guaranteeing an environment for business to succeed. Government is adhering, as best as it could, to its role in fighting HIV and in improving health for all. But it truly must be a collaborative effort. It truly must be a partnership effort.

We see working together, supported by strong political commitment, as critical in averting the worst consequences of HIV. But we must also be aware of what could have happened had we not change the trajectory of the epidemic.

I made reference of the potential to affect the labor supply and its effect on productivity and transaction cost. While this has not happened in Guyana, it has had tragic consequences in several countries. Health and education sectors, agriculture and manufacturing and the general labor force have been severely affected in South Africa, Kenya, Nigeria, Swaziland, Botswana, Uganda etc.

By 2005, the labor supply in Botswana contracted 18%, in South Africa by 14%, in Mozambique by 10%. Unless the trajectory of the epidemic changes in South Africa, the contraction of the labor force could reach 35% by 2020.

Even at this stage, evidence has accumulated to demonstrate the effect of HIV on growth as measured by GDP. Countries like Swaziland and Botswana, South Africa, Mozambique and others have shown an AIDS-related decrease of GDP by about 1.4% annually between 1990 and 1997.

A study just completed in South Africa and Kenya has shown that unless there are dramatic changes to the epidemic, the Kenyan economy will shrink by one-sixth by 2015 and the economy of South Africa will shrink by about 17% by 2020. This study showed that half of the decline can be attributed to increased expenditure related to health care costs and a third of the decline is associated with lower productivity due to labor supply.

Clearly, HIV, through its demographic effects and its social and economic consequences, has evolved into a major threat to economic development in many countries around the world. Equally compelling, however, is that the consequences of uncontrolled HIV need not be our destiny. We do have the power to avert these consequences. The Government of Guyana is determined that Guyana would not have to experience the negative consequences as some other countries have had to.

For example, HIV unequivocally has led to the loss of some of the gains some developing countries made in the first 75 years of the 20th century. By the 1970s, every country had attained a life expectancy at birth of greater than 50 years. But since then, many countries, mainly in Africa, experienced major reduction in life expectancies in the last quarter of the 20th century and such reduction in life expectancies has not abated in this first decade of the 21st century. There are now dozens of countries with life expectancies at birth below 50 years. Indeed, some countries have lost as much as 20 years in life expectancies at birth. These losses are almost entirely due to HIV.

After impressive gains in life expectancies in the decades of the 1950s and 1960s, Guyana suffered losses in life expectancies due to deteriorating health conditions in the 1980s. This loss was not due to HIV and was expected to be reversed in the 1990s after the health conditions improved, reflected by decreasing maternal, infant and under-5 mortality rates. Yet, for most of the 1990s, the life expectancy at birth for Guyana remained unchanged, relatively stable, in spite of the improving maternal, infant and under-5 mortality rates. Quickly, it was realized that Guyana was not realizing gains in life expectancy at birth because the positive impact of reduced infant and under-5 and maternal mortalities were being eroded by deaths of young people living with HIV. Thus, even in countries like Guyana, with HIV prevalence far below those of the Sub-Saharan African countries, HIV had already, even after less than 20 years, shown its power to affect the socio-economic conditions of a country. Thus, far, researchers have only focused on the dramatic changes, such as in Africa. But subtle changes had already begun to emerge in countries where HIV had not been seen as a major public health problem soon after the discovery of HIV.

Guyana introduced universal access in 2001. At the time of its introduction, Guyana as a developing country took bold leadership in this direction and pre-dated the global initiative for universal access. There was no donor or partner. It was exclusively an expenditure of the central government. At the end of 2007, Guyana had a life expectancy of about 68 years, the first increase since the early 1970s. This was mostly due to the continuing gains the health sector made in dealing with under-5 mortality and maternal mortality, but also due to the reducing number of deaths because of HIV. The central government investment, which was bolstered later on by the generous partnership with PEPFAR, World Bank and Global Fund, paid off.

This is but one example of how HIV can affect a country. There are many others, such as the drop-out rates in African schools, affecting education. But think of the consequences to business. Losses of potential healthy years lived reflects a generally unhealthy population. This in turn affects productivity and increase the cost of doing business.

No government or no business can afford this situation whereby the economic development of the country is affected by the general state of unhealthiness of the population.

It is for this reason that the PPP/C government from its first day in office invested heavily in health. Often times, businesses do not realize the great inputs of central government to the successes of business. In many countries one of the expenditure items for business is health insurance for its employees or the direct provision of health care. In Guyana, generally, this is not an expenditure item for businesses. The public sector directly and indirectly provides more than 90% of health care delivered to the population. The cost for this service is borne entirely by the Government of Guyana.

In 2008, the Government will spend just about $12B in the health sector, accounting for about 11% of the national expenditure. This is outside of expenditure through our partners. In 1991, just about 1% of the national expenditure was allocated to health. We have moved from an investment of about $US7 per capita in 1991 to almost $US80 per capita this year. Out-of-pocket expenditure in health through the private sector is about $US20 per capita. Other inputs account for about $US12 per capita. This amounts to about $US112 per capita. We estimate the need for about $US133 per capita to meet the demands for health for all, outside of providing expensive tertiary care, such as open heart surgeries etc.

This demonstrates the important fact – we need to optimize our expenditure in order to meet the gap. Partnership again is the answer. The Government of Guyana has pursued a strong public private partnership for the provision of services. This partnership has led to the availability of services not available before at a cost considerably less than the cost of traveling abroad for such services.

The government’s strong commitment to engaging civil society in the fight against HIV and in the drive for better health for all is another example of reducing transaction cost and achieving better results. The Business Coalition is an example of the robustness of this commitment.

Guyana’s strong political commitment, the national government’s allocation for health and its determination for universal access for services, including HIV services, the mobilization of a national effort and our robust international partnership have resulted in Guyana having an improved health sector and an HIV response that is a model for a resource-poor setting.

At this point, I must reflect a little on our efforts to ensure a human resource capacity which can deliver the services for which we cater. Guyana is a country with a rich and proud history of training personnel for the health sector. In two weeks time, Guyana will have its orientation for the 2008 incoming batch of nursing students. At this time, 403 students have accepted places in the nursing school. It is at least two times as large as the largest ever incoming class of nursing students. By 2000, Guyana’s training capacity could have catered for only about 100 new students maximally. Later this year more than 60 young medical students will join the health sector after completing studies in Cuba. More than 300 Guyanese from all ten regions of Guyana are studying medicine in Cuba. This month five new surgeons have been added to the roster of doctors in the regional health system.

These are examples of the investment in human capital that our government has pursued. I continue to be dismayed by the ongoing practice by some in the developed countries in recruiting our trained health care personnel. Guyana has no interest in curbing the rights of our citizens to free movement. But the bulk of our training cost come directly from central government expenditure. Guyana, like other developing countries with this problem, must benefit from its bold and difficult investment in building human capital. At the very least, recipient countries should assist Guyana and other countries in meeting the training cost.

We need to recognize that even within the country, non-public sector benefits are derived from these training programs. Many of the persons trained through public sector investment end up working for and serving the private sector. We do not see this as a problem. This is another way businesses benefit from central government investment in the social sector.

Together with our investment in the social sector, amounting to almost $50B or about 40% of the national budget, our investment in health has contributed significantly to the overall improved macro-economics of the country.

I believe that Guyana has the capacity to win the battle against HIV. But if we believe that we will guarantee good health and economic prosperity by simply fighting HIV, we are wrong. We need a strong health sector and therefore the resources flowing because of the need to fight HIV cannot be used in separate compartments. We can’t develop policies to stop stigma and discrimination against HIV. Instead we must develop policies to prevent stigma and discrimination, whether it is because of HIV or for any other reason. We cannot develop laboratories for HIV. We must develop laboratories for health. In short, we need to develop strong health systems. And I would hope that we are able to utilize resources which flow because of HIV to strengthen our health systems and social programs.

We have done this before. Faced with the massive destruction after World War 2, led by the US, the West mobilized unprecedented resources not merely to reconstruct the destroyed infra-structure of Europe and other places, but to drive overall development. Today the Marshall Plan is being revisited in the form of resources for HIV, TB and Malaria. It must be utilized similarly for the overall development of health.

Many of the companies in this coalition have signed Workplace Policy Instruments. This is a good start. I want to commend the Tripartite Committee, consisting of Government, labor and private sector in working on a national workplace policy instrument. When this document is finalize, the National Workplace Policy Document will become the legal instrument governing workplace HIV policies.

Let me express my gratitude to GHARP and to the USAID, to PEPFAR for their generous contributions to Guyana’s fight against HIV. I want to also thank the businesses that have come together to establish the Business Coalition. I wish them all success.

In ending, some of us see stopping epidemics like HIV as a moral duty. Some of us see it from the perspective diplomacy. Others see it as an investment in self-preservation. The fact is stopping HIV is all of these.

It is my pleasure, on behalf of His Excellency, President Bharat Jagdeo, the Government of Guyana to declare officially launched the Guyana Business Coalition.

Thank you.

May 30, 2008