Chronic diseases and trade in emerging economies

Renz Adrian T. Calub (draft 2015.02.04)

Over the course of two decades, Asia has seen a substantial rise in integration, particularly in
areas of trade and investment flows, financial asset holdings, and tourism. Recognizing the
benefits from increased cooperation in the face of crisis has also lead government to strengthen
ties with one another.

Trade is an essential indicator of Asia’s strengthening integration. Economic interdependence

through trade linkages lead to cheaper commodities, increased productivity, and stronger
cooperation between countries. Free flow of goods allows local firms to access international
markets and therefore increases competitiveness, which can eventually lead to linkage in the
global value chain. With increased trade, smaller economies are tied up to larger economies
such as People’s Republic of China (PRC), Japan, and Rep. of Korea, who then trades its final
goods to the advanced economies. If the trade ties prove to be beneficial, governments may
even engage in free-trade agreement negotiations, which can deepen ties further and may allow
access to more investments.

This phenomenon, however, seems to miss out the domestic long-run costs to human capital.
While rising trade may have been beneficial to growth, the demand to increase efficiency and
productivity can be detrimental to developing economies with institutions unprepared to ensure
the health of its work force. While infectious diseases and gaps in maternal and child health are
still being addressed in developing economies, it is no longer safe to assume that chronic
diseases would be the least of their problems. The increasingly complex production process to
catch up with the demands of trade and investment links may have altered personal preference
and consumption patterns, exposing people to chronic health risks. In the face of unprepared
institutions, these developing economies may have to carry the burden of chronic diseases at
the expense of its potential growth.

Trends in Asia intra-regional trade

Asian economies have traded heavily within the region. In fact, the share of intra-regional trade
captures more than 50 percent of its total trade with the world, almost catching up with the
European Union. Within the region, East Asia and Southeast Asia captures the largest share in
trade given the size of its economies such as PRC, Japan, and Republic of Korea and its
linkages with the ASEAN economies. Central Asia, despite being isolated due to its geography
and history, is slowly being integrated to the rest of the region and could be a strategic link with
the rest of Europe. This is already the picture of trade in the light of existing bilateral trade
agreements and interests to push through a regional (multilateral) trade agreement, particularly
the Trans-Pacific Partnership (TPP) agreement and the Regional Comprehensive Economic
Partnership (RCEP).

Figure 1. Intra-regional trade (% of total trade)

An interesting trend can also be seen at the commodity level. Food and beverages, both
primary and processed, capture the second largest share in final goods intra-regional trade.
Processed food and beverage have a higher share compared to primary food products which
are mostly agricultural and fishing goods. While the share of primary food and beverages has
stabilized over time, it should be noted that the share of processed food has been increasing
within the region.

Table 1: Final goods trade (% of total)

BEC commodity classification 2000 2005 2010 2011 2012 2013
Consumption goods nes, durable 15.8 20.1 21.8 22.3 22.9 22.9
Consumption goods nes, non-durable 14.8 14.8 14.8 14.6 14.6 14.6
Consumption goods nes, semi-durable 44.9 41.5 37.2 36.2 36.7 35.5
Food and beverages, primary, mainly 9.0 7.3 8.1 8.2 8.0 8.1
for household consumption
Food and beverages, primary, mainly 14.0 15.0 16.8 17.4 16.6 17.5
for household consumption
Source: Author’s calculation using data from UN Comtrade.

Trade in intermediate goods suggests integrating production links within the region. Although
shares have trimmed recently possibly due to the slowdown in the global economy, intra-
regional trade in industrial inputs and capital goods remained high. The share of fuels and
lubricants trade, for instance, exhibit an increasing trend.

Table 1: Intermediate goods trade (% of total)

BEC commodity classification 2000 2005 2010 2011 2012 2013
Food and beverages, primary, mainly 0.7 0.4 0.5 0.7 0.7 0.7
for industry
Food and beverages, processed, mainly 1.2 1.2 1.7 2.0 1.9 1.8
for industry
Fuel and lubricants, primary 5.3 6.0 6.8 7.6 7.8 8.0
Fuel and lubricants, processed 3.0 2.4 2.2 2.5 2.6 3.0
Industrial supplies nes, primary 4.7 5.6 8.5 9.6 8.3 9.9
Industrial supplies nes, processed 41.3 39.0 38.0 39.2 38.6 38.6
Parts and accessories of capital goods 39.9 40.8 37.0 33.3 34.8 32.5
Parts and accessories of transport 3.9 4.7 5.3 5.1 5.3 5.6
equipment
Source: Author’s calculation using data from UN Comtrade.

Chronic diseases have shifted towards developing economies

It is no longer safe to assume that chronic diseases are concentrated on developed economies
while communicable diseases are concentrated on developing economies [Nugent 2008].
Based from the WHO Global Infobase data, clinical risk factors related to chronic diseases have
been increasing from 2002-2010 in Southeast Asia. That males are more susceptible to higher
body mass index or cholesterol levels is no longer the case as the increasing trend is also seen
in females (Table 1). As of 2010, Bhutan, The Maldives, and Timor-Leste have recorded
significantly high obesity prevalence particularly in females. Mean cholesterol levels have
increased even as most of the countries are still within the desirable range1, with India,
Thailand, and Sri Lanka reaching the borderline.

Table 1. Clinical risk factors

Males, 15 up Females, 15 up
WHO South-East Asia 2002 2005 2010 2002 2005 2010
BMI (>= 30 kg/m-squared)
Bangladesh 0.11 0.15 0.24 0.09 0.15 0.25
Bhutan 5.27 5.78 6.73 13.06 14.30 16.52
Myanmar 1.78 2.07 2.68 8.01 9.14 11.27
Sri Lanka 0.18 0.18 0.19 0.06 0.09 0.17
India 0.89 1.14 1.71 1.09 1.39 2.03
Indonesia 0.23 0.24 0.25 1.99 2.59 3.89
Maldives 4.73 5.72 7.67 20.23 22.00 25.02
Nepal 0.14 0.19 0.30 0.21 0.20 0.33
Democratic Republic of Timor-Leste 5.96 6.50 7.50 14.16 15.43 17.69
Thailand 2.45 2.50 2.58 7.03 8.41 11.05

Cholesterol (mmol/l)
Bangladesh 4.04 4.10 4.20 4.28 4.34 4.44
Bhutan 4.65 4.71 4.81 4.65 4.71 4.81
Myanmar 4.85 4.94 5.09 4.85 4.94 5.09
Sri Lanka 5.47 5.53 5.63 5.38 5.44 5.54
India 5.00 5.06 5.16 5.15 5.21 5.31

1
See http://www.mayoclinic.org/diseases-conditions/high-blood-cholesterol/in-depth/cholesterol-levels/art-
20048245 for interpreting cholesterol numbers.
 Indonesia 4.39 4.45 4.55 4.47 4.53 4.63
Maldives 4.81 4.87 4.97 4.81 4.87 4.97
Nepal 4.61 4.67 4.77 4.61 4.67 4.77
Democratic Republic of Timor-Leste 4.68 4.74 4.84 4.68 4.74 4.84
Thailand 5.16 5.10 5.20 5.38 5.29 5.39
Source: WHO Global Infobase. Retrieved 16 Oct 2014.

The number of deaths due to chronic diseases is significantly high, with values reaching as high
as 100 deaths per 100,000 population. Cancer mortality rate in Maldives surges in 2004,
reaching as high as 345 per 100,000 males and 266.9 per 100,000 females. Recent adult risk
factors data seem to support this, with 25 percent of the population consuming tobacco in 2011,
23.4 percent having raised blood pressure (2008), and 12.9 percent having obese weights
(2008). Furthermore, the island country has a 16 percent probability of dying due to non-
communicable diseases [WHO 2014]2.

Table 2. Burden of chronic diseases - Cancer

Male Female
WHO South-East Asia 2002 2004 2002 2004
Estimated age-standardized
cancer deaths per 100,000
Bangladesh 110.8 107.6 111.0 107.5
Bhutan 117.0 109.1 107.2 95.4
Myanmar 123.0 123.0 108.2 102.4
Sri Lanka 128.2 126.7 107.2 104.2
India 114.6 105.8 103.4 95.6
Indonesia 142.7 139.2 124.2 117.8
Maldives 114.3 345.0 132.0 266.9
Nepal 119.1 118.5 118.1 114.7
Democratic Republic of Timor-
Leste 128.9 106.6 108.6 85.3
Thailand 138.9 156.7 118.9 116.9
Source: WHO Global Infobase. Retrieved 16 Oct 2014.

Closely linked to high BMIs is the prevalence of diabetes mellitus. Between 2002 and 2004, the
estimated number of deaths has slightly fallen for the observed Asian economies with the
exception of the Maldives, albeit this is likely due to its smaller population relative to other
countries in the table.

Table 3. Burden of chronic diseases – Diabetes mellitus

Male Female
WHO South-East Asia 2002 2004 2002 2004
Estimated age-standardized
diabetes deaths per 100,000
Bangladesh 26.9 26.0 24.7 23.9

2
http://www.who.int/nmh/countries/mdv_en.pdf?ua=1.
 Bhutan 27.6 25.9 20.7 18.9
Myanmar 31.0 30.7 29.4 27.9
Sri Lanka 42.6 42.2 37.7 36.2
India 26.4 25.5 20.5 19.4
Indonesia 30.3 29.3 36.9 35.3
Maldives 30.1 55.5 39.1 77.5
Nepal 30.1 29.6 31.6 30.8
Democratic Republic of Timor-
Leste 32.4 27.1 29.6 24.5
Thailand 31.6 33.5 52.1 52.1
Source: WHO Global Infobase. Retrieved 16 Oct 2014.

Concluding remarks

In this paper we have tested the link between non-communicable diseases and economic
integration in the context of trade. We have argued that along with the increasing integration
especially in the developing economies, health risks have also increased. Increased health risks
can lead to more deaths due to non-communicable diseases, which can eventually derail
potential economic growth.