Economic consequences of micronutrient status: Challenges and opportunities for food fortification

1
Economic consequences of micro-nutrient status
Challenges and opportunities for food
fortification

• John Hoddinott
• International Food Policy Research Institute
• Washington DC

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Introduction

• Micro-nutrient deficiencies are pervasive in the
  developing world. It is estimated that
• 2 billion people suffer from iron deficiencies
• 140 million pre-school children are deficient in
  Vitamin A
• 17.6 million children are born annually with
  mental impairments resulting from iodine
  deficiency
• Improving micro-nutrient status has intrinsic
  value
• Reductions in mortality, in morbidity and
  improvements in health status that result from
  such improvements are a good thing.

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Introduction, contd

• Improving micro-nutrient status via fortification
  and other means also has instrumental value where
  
• Improvements in micro-nutrient status lead to
  improvements in economic outcomes
• While the intrinsic motivation for improvements
  in micro-nutrient status are important, it is
  their instrumental value which are the focus of
  this presentation.

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The economic consequences of improved
micro-nutrient status

• Improvements in micro-nutrient status conveys
  economic benefits through the following pathways
• Improvements in certain forms of micro-nutrient
  status reduces infant mortality.
• This conveys economic benefits in terms of the
  resources that would otherwise be needed to avert
  infant deaths and/or the present discounted value
  of future incomes earned by this person
• Improvements in certain forms of micro-nutrient
  status reduces infant and pre-school morbidity.
• This conveys economic benefits where households
  no longer incur costs (time, money) associated
  with these illnesses

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The economic consequences of improved
micro-nutrient status, contd

• Improvements in certain forms of micro-nutrient
  status assist in enhancing physical growth.
• This conveys economic benefits where increased
  stature in adulthood is causally linked to
  productivity.
• Improvements in certain forms of micro-nutrient
  status (iron) enhance physical productivity
• This conveys economic benefits where physical
  productivity is linked to micro-nutrient status
• Improvements in certain forms of micro-nutrient
  status (iodine, iron) can enhance cognitive
  development and learning.
• This conveys economic benefits where cognition
  and schooling are causally linked to
  productivity.
• Some of these benefits may be transmitted
  intergenerationally

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The economic consequences of improved
micro-nutrient status, contd

• Assessing whether these potential benefits
  justify, on economic grounds, interventions to
  improve micro-nutrient status requires
  quantifying
• The benefits,
• The costs, and
• The distribution of these benefits
• None of this is straightforward. For example
• What is the value of a death averted? 500?
  100,000?
• How do you quantify reduced expenditures on
  treating illnesses in environments where all
  medical services are publicly provided? Where
  few, if any, households seek medical treatment?
• How do you value future benefits derived from
  improvements in cognitive function when the
  returns to cognitive ability are highly
  uncertain?
• What is the appropriate discount rate?

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The economic consequences of improved
micro-nutrient status, contd

• Mindful of these caveats, measures to improve
  micro-nutrient status fortification,
  supplementation, and biofortification appear to
  have high benefit cost ratios both in absolute
  terms and as compared with other investments that
  can be made to improve the well-being of poor
  people in developing countries

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Fortification Snapshots of successes

• A key component of strategies to reduce
  micro-nutrient deficiencies is fortification.
• The last 10 years has seen significant advances
  in food fortification, particularly that of
  iodine. For example
• China, with an estimated 40 per cent of the
  worlds at-risk population, reduced low iodine
  status in school children by 75 per cent
• Madagascar went from no iodated salt in 1992 to
  98 per cent coverage by 1998

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Fortification Four Challenges

• Measuring impact
• Do we truly know what the baseline looks like
  how much of a difference are interventions really
  making
• Technical and regulatory
• Fortification requires an appropriate mix of
  partnership and regulation
• Political economy
• Convincing Finance Ministers that they should
  worry about micro-nutrients
• Distribution
• Ensuring fortification is pro-poor

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Conclusions

• Efforts to redress deficiencies in
  micro-nutrients has both intrinsic and
  instrumental value
• Fortification has an important role to play in
  such efforts and has already shown some
  significant benefits
• Nevertheless, significant challenges remain