Generally, diseases affect macro and micro economic development because sick people cannot produce. They lack the energy to actively engage in a productive life. Unfortunately for Liberia, fourteen years of civil war has not only killed about 300,000 people and destroyed the country infrastructures, but also led to multiple, internal displacement of hundred of thousand of people, disrupted delivery of basic services, increased vulnerability of many Liberians, particularly women and children to extreme poverty, hunger, and diseases, most especially HIV/AIDS. UNICEF published a paper title, “At a glance: Liberia-The Big Picture." The reported cites that HIV infection is increasing, particularly amongst young Liberians between ages 15-49 years at a prevailing rate of 5.9 percent per annual.

The severity of this disease is demonstrated through an epidemiological analysis of the impact on the population over a longer period of time. AIDS, for example produces HIV in about six years, reflecting the incubation period of the disease. However, the epidemic creeps through the population and establishes a pool that is raised to a considerably high level, that the true impact is felt in terms of AIDS deaths. By then, the epidemic is in full swing and the only way people can leave the pool of infection is by dying, since there is no cure as yet. Therefore, recognizing the gravity of the impact of this disease on the country economic development is important for post-war Liberia. Because, the severity of the epidemic is not only measured on the destruction of human lives, its impact will affect macro and micro economies of Liberia by how its contributes to the reduction of labor supply, increase costs of living, lower productivity, and curbs savings and investments.

AIDS, the Acquire Immune Deficiency Syndrome, by definition, is also defined as a group of diseases that attack and destroy the body’s immune system, using its virus known as Human immunodeficiency virus (HIV). AIDS virus damages the body defense system, which is the anti-body producing cell that defends human immune system (Jennings, p2). While it is true that technology helps to extend the life of infected people in developed countries, there is no known cure for the disease. In addition to not having known cure, optimism for infected people in Liberia is an illusion due to high costs of drugs therapies, high interest loans from developed countries (debt burden), and rampant corruption rubbing the country of its gross national income and needed medical supplies.

The wide spread of AIDS in Liberia may be caused by variety of factors, which include male promiscuity, polygamism, female genital mutilation, prostitution, rape among others. However, there is a general feeling that sexual intercourse/heterosexual behaviors contribute to most infections, especially from prostitutes who use sex trade as a means of employment and survival. According to UNICEF report of 2003/2004, the average gross national income per capita in Liberia is USD$130, the average GDP per capital annual growth rate between 1990-2003 is 5.3 percent, inflation average annual rate in the same period is 54 percent. Therefore, it is quite understandable that 36 percent of the population, mostly women and their children live below $1 a day, giving rational justification for sex trade.

Poverty and AIDS drive a vicious circle. The drive between poverty and AIDS relates to one’s weak endowment and financial resources. The vicious circle can also be viewed as low levels of education associated with high illiteracy rate, limited marketable skills and poor health that contribute to low labor productivity. Craddock, one of the scholars on AIDS research in Sub-Sahara Africa writes that about 55 percent of African youth who drops out of secondary school are sexually active with more than one sexual partners, about 40 percent of men are engaged in promiscuous sex. He indicated further that African youth are pressured by men and families to get money, finances from boyfriends or husband to support their families.

If one gives considerable thought to Craddock’s view in relationship to the concept of vicious circle between AIDS and poverty, the only responsible thing for Liberia is for the government to take a leading role now in addressing the issue of the spread of AIDS so as to minimize its impact on the economic development of future Liberia. Because government serves as the main determinant in solving the economic and social issues of its citizenry, the issue surrounding AIDS must be examined and tackle now to avert future setback on the country’s economic development programmers, for not doing so would infect more people.

There are many scholarships on AIDS infection in Sub-Sahara Africa. UNAIDS report of 2000 said Africa is home to about 70 percent of the adults and 80 percent of children living with HIV world-wide, and has buried three-quarter of the more than 20 million people who have died of AIDS and AIDS related illnesses. To put this argument in a regional context, the epidemic prevalence has shifted from Eastern and Central Africa to the Southern parts of the continent. It is widely reported by UN that at-least one in ten South African adult is living HIV. This region, with a total of 4.2 million infected, has the largest number of people living with HIV in the world, as well as one of the world fastest growing in the epidemic. Although Liberia is in the western part of Africa, the country has the fourth highest per capita caseload in the west. With a total population 3 million people, about 8 percent is infested according to recent report. On sooner than later, people, especially of working age will begin to die, leaving orphans who cannot work to sustain life on their own.

The effect of AIDS on the household begins as soon as a member of the household starts to suffer from HIV-related disease. The primary effect is loss of income of the patient, especially if the patient is the only source of support for the family. A number of studies, notably, Cddington (1991) on Tanzania, Kambou, Devarajan and others (19991) on Cameroon and the third by Myers et al (1991) on Thailand show that the economic costs of HIV is colossal. The costs come in the form of reduced growth, decline in savings and investment rates, and huge health care costs. Other family members of the household also incur indirect costs such as missing work, or school to care for the sick. When the patient dies, the temporary loss of income becomes a permanent one. There are also costs of loss labor, lower remittances, funeral and mourning. Sometimes and most oftentimes, the family may compensate for the lost income by reducing investments in productive activities, (e.g. removing a child/children from school to save on expenses and increase household labor). Household also loose most of its savings by paying for high costs of HIV/AIDS health care and funeral expenses.

The highly urbanized Liberian population may suffer the worst impact because of the lack of community support mechanism in cities. On the other hand, rural communities are also vulnerable because households are unable to secure non-farm income due to seasoned labor demands, high dependence on female labor, dependent on natural fertilizers, no credit facility, and unable substitute labor with labor savings technologies. Furthermore, since the outbreak of the civil war, the migrant labor system exacerbated the impact of AIDS with its contribution to highly unstable rural female-dependent households. Most of these people spend their time among quarter of the Liberia population who commutes between refugees camps in the West African region in such of shelter and securities, while the rest of the able-body men engage in fighting for different factions, un-protective sexual promiscuity with young women. In order to fully appreciate the enormity of this crisis, (HIV/AIDS epidemic in Liberia), it is necessary not only to understand the epidemiological of the disease, but to also understand its impact on economic development of Liberia from the standpoint of industries/companies.

Even-though improved health does not always come with high-income growth, classical economic theories see health as more or less benign product of the development process. There is the general notion out there that wealth leads to improve health. In fact this notion is supported by an apparent correlation between GDP and life expectancy. Professor Mike Mtika under scores this notion when he writes, “that the impact of AIDS is measured by an individual’s means to command commodity bundles. That is if people lack the means (are sick), they lack the adequate command that enables them obtain their entitlement, compromising even their food security” (Mtika, P-347). His argument was buttress by Amartya Sen in Development As Freedom when he analyzed income and life expectancy between African-American men and men in China’s Kerala (Sen, p21). More recent research has however, began to establish that countries with good and healthy population tend to grow faster (particularly in good policy environment), and that this apparent correlation between health and wealth operates through a number of channels including the effects of improved health on demography, education, the labor market and investment.