- The greatest productivity losses from being undernourished were in agriculture, mining and construction, with Ethiopia and India facing the highest burden.
- The biggest impact from obesity was felt in the mining, education and health sectors.
- The direct productivity losses are estimated at $130 billion to $850 billion.
- Countries like Ghana, Namibia, Tanzania and Zimbabwe have faced a “double burden” of malnutrition, Chatham House said.
Facing multiple malnutrition problems at the same time presents complexities for businesses and governments on how to act
Jessica Fanzo, a professor of food policy at Johns Hopkins University
A whooping $850 billion a year is lost in productivity. This is the price poor diets in developing countries are costing businesses.
The findings is based on a study by Chatham House and Vivid Economics, the first to analyze the impact of under-nutrition and obesity on business in low- and middle-income countries.
The findings is a wake up call for companies who have been grappling ‘with eyes wide shut’ on scaling up productivity and at-tendum dealing with the impact of the pandemic on investments.
Both conditions make it difficult for employees to reach their potential and lead to ill-health, which leads to more sick leave.
Global prevalence of malnutrition among adult population
Multinational companies need to do more to fight malnutrition, according to Chatham House. That should include policies that support breastfeeding mothers, offer regular health checks and provide nutritious and subsidized food at work, the London-based think tank said.
“Business has a significant role to play,” Laura Wellesley, a senior research fellow at Chatham House, said in an interview. “Aside from productivity losses, there is a significant reputational risk for companies who have a large footprint in low- and middle-income countries and who aren’t doing anything on nutrition.”
Obesity has been on the rise in poorer countries, which were already grappling with high rates of undernourishment.
The pandemic has further highlighted the importance of nutrition, with studies showing that obese people are more likely to die from Covid-19. The United Nations predicts the virus could push another 10 million children into acute malnutrition.
“We can expect the pandemic to worsen the costs, because economic insecurity is so closely associated with nutrition insecurity,” Wellesley said. “We can expect that more households will struggle to access nutritious diet.”
The Chatham House study examined the impact of poor nutrition on 13 business sectors — from mining and agriculture to construction and retail — in 19 countries. It then scaled up the findings to estimate the annual productivity losses due to obesity and under-nutrition across developing nations.
Costs in the workforce as a share of gross value added
Capital Business on June 11 reported that “as a result of COVID-19, an estimated 30 percent of Kenyans living in Nairobi’s informal settlements are experiencing severe hunger”.
Droughts in 2018/19 has impeded economic growth and pose serious threats to food security.
The direct productivity losses are estimated at $130 billion to $850 billion. That range reflects a number of variables and the way Vivid Economics’s model extrapolates the findings from the 19 countries, according to Chatham House.
Still, the impact of poor nutrition could be even larger.
The model doesn’t include the costs of impaired cognitive development and low educational attainment resulting from undernutrition in childhood, nor does it capture indirect costs such as paid sick leave for malnutrition-related illness.
While employees in all the sectors studied were more likely to be underweight than obese, countries like Ghana, Namibia, Tanzania and Zimbabwe have faced a “double burden” of malnutrition, Chatham House said.
“The toll on human health is enormous, but the economic impact is so huge as well,” Sarah Rawson, a nutrition and health lead at Olam International Ltd., said in an interview. “If we’re going to face up to future pandemics, we need the whole population to be as well nourished as possible so they’re resilient to it.”
Olam, an agribusiness giant, is one of the companies backing the Power of Nutrition foundation that funded the study.
