Skip to 0 minutes and 13 seconds RICHARD SMITH: It’s important to realise, of course, that most of the determinants of health are not health care related. So there are things like education, employment, housing, clean water, sanitation, the various things we call social determinants of health. And that’s essentially what we think of in terms of the indirect impacts. It’s things that are going to impact on all these other aspects of the life of these people, other than the disease itself, and the health care related to it. What’s important is that most of these things will have a far larger impact on the eventual health of the population than the direct impact of this particular outbreak.
Skip to 0 minutes and 54 seconds So previous work that we’ve done, for example, with SARS, with pandemic influenza, foot and mouth disease, all sorts of outbreaks that have happened, there’s a very specific direct impact of the disease itself. This is usually related to the mortality, the morbidity, and the health care costs. But then, these longer-term effects, the wider effects that last much longer, become much more important, not just for the economy, but also eventually for health, because of course health is intrinsically linked with the economy. Good health requires a good economy. These indirect effects, these wider effects on the economy, can be very significant.
Skip to 1 minute and 32 seconds So our work on SARS, for example, showed that the losses there to areas like tourism, leisure industry, food, travel, they total some $9 billion in China. One and a half billion in Hong Kong, which was clearly very severely affected. But what’s interesting, is it also led to losses of around $5 billion in Canada. And of course, Canada really didn’t have very much, in terms of impact of SARS. Although, it was subject to a WHO travel advisory.
Skip to 2 minutes and 4 seconds Our other work on potential impacts of pandemic influenza to the United Kingdom, for example, a developed economy at this point, the range there was between a half a percent of gross domestic product for a mild outbreak, to 9 and 1/2% for an extreme SARS-like outbreak. What’s important about these impacts on gross domestic product is that is effectively your national wealth, or your national income. So if that declines by those sorts of magnitudes, and to put that in context, in the UK, the impact of the financial crisis was 2 1/2%.
Skip to 2 minutes and 40 seconds So if we had something that was 8 and 9%, like a severe case of pandemic influenza could be, that could be absolutely catastrophic on the economy of a very resilient country like the UK. Work we did elsewhere on places like Thailand, South Africa, Uganda, showed that you’d have a much more disproportionate impact on those economies, because they’re not quite so resilient and able to withstand the impacts of such outbreaks. Recent reports from West Africa, the World Bank has forecasted the economic losses due to Ebola that will be somewhere between $4 and $30 billion. That’s around a half to 3% of that region’s and gross domestic product or their national income.
Skip to 3 minutes and 25 seconds The bank have also indicated that about half of the working population of Liberia, for example, is no longer working, since this crisis began. So clearly, the extent of the impact will depend on how wide the disease spreads, on how long it lasts. But these levels indicate there’s going to be significant impact on economic growth. That’s really important, because the development of these economies is dependent on the growth of their economies, of course, by definition. They need their gross domestic product, their national income, to increase year on year.
Skip to 4 minutes and 1 second Not just to be able to afford education, employment, housing, the things that have already been mentioned, but also, of course, to invest in health care, which we know as being critically wanting during this particular outbreak itself. So in those parts of West Africa that are affected by Ebola, we’ve seen a number of things happen already. We’ve seen a number of big mining firms, for example, shutting down their operations or evacuating their foreign staff. And certainly, we have organisations like China Union, which began shipping iron ore out of Liberia earlier this year, scaling down its activities, threatening to shut down completely. We have investors, they’re reducing investment in many of these companies, so share prices have started to fall.
Skip to 4 minutes and 48 seconds Again, significant impacts on those particular sectors of the economy. And that’s the sad thing about Sierra Leone, because we were all kind of just getting quite excited that all of this new business was coming in. And it was quite exciting, and it was a good place to live. But now, how long will it take for all of those businesses– I mean, I’m here now, but I know that a lot of people who have the ability to move out, this looks like the war. So a lot of people who had the ability to move out, have.
Skip to 5 minutes and 19 seconds And all of that talent and expertise, all of the people who had moved back from the diaspora, are just out of there– out of Sierra Leone again. And it’s going to take time for them to come back, and that’s a real shame. If we look at the war that was from ‘91 to 2002, it’s kind of taken like a decade to get to where Sierra Leone was, which I was saying was a kind of good place for further development. I hope it doesn’t take as long. I hope that we can focus on the things like building the health system, like the education system, and that we can find ways to accelerate that and those changes.
Skip to 6 minutes and 2 seconds Because if we go out the same pace, it won’t take long for something else like this to happen again. In Liberia we haven’t gotten over the war. We’re still recovering from the war, and now we have a different war. It’s more of a biological war, but it’s another war, so families have been destroyed.
Skip to 6 minutes and 28 seconds It’s not going to take a short amount of time for Liberia to be repaired from the grassroot level all the way up to the institutional level. It’s going to take at least two decades, because the war ended 13 years ago. We’ve had 13 years of peace. But when you go to Liberia, you can still see damages of the war, though there hasn’t been fighting in 13 years. And families have still been torn because of that. So now that you have Ebola, not much, not much fixing will be done within a short amount of time. Even if the disease gets eradicated, it will still take a long time.
Health and development effects of the Ebola outbreak
The indirect effects of epidemics on a nation’s economy and health can be much greater than the direct ones. Poverty and neglect of health systems contributed to the West African Ebola outbreak, and the indirect effects of Ebola will lead to further deepening of poverty and degradation of health systems, thus creating wider challenges for the future. In the video, Professor Richard Smith outlines the importance of recognising these indirect impacts.
A core indirect impact is on the economy, with significant reductions in national income or gross domestic product (GDP) likely. Reductions in GDP mean that governments can’t afford to spend on core public services, such as healthcare. Businesses close and people lose their jobs, and without work people can no longer afford food, clothing, and other essentials for life. Ebola contributes to a vicious cycle of development whereby poor health leads to a poorer economy, and in turn even poorer health.
Research on previous outbreaks, such as SARS and pandemic influenza, has estimated major indirect economic costs. In West Africa, the World Bank has estimated1 an Ebola-based economic loss of between $4 billion and $30 billion: from 0.5% to 3% of the region’s GDP.
What we are seeing with Ebola is consistent with other outbreaks, where the economic costs are out of proportion with their health impact, and geographically more wide-reaching. The SARS outbreak in 2003 is estimated to have caused between $30 and $100 billion worth of damage to the global economy, despite only infecting approximately 8,000 people and causing fewer than 800 deaths. That is because panic and confusion can be as or more disruptive than the disease itself. For example, Gambia hasn’t had a single known Ebola case, but fears of the virus and cancelled flights have led to hotel bookings dropping by 65%: a significant hit to its economy.
In the video, Regina Bash-Taqi talks about some of these issues in Sierra Leone, and how gains in economic development that had been achieved since the end of the war are now under threat. Pearlyn Mamulu describes the same situation in Liberia, and how Ebola is featuring as ‘another war’ in the lives of people there, reflecting the range of challenges and disruption people face.
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