New Zealand’s latest quarterly GDP figures may be up by one percent, but they are still an estimated US$1.1 billion (NZD$1.65 billion) a year short of what they should be because they fail to include the economic value of breastfeeding and mothers’ milk.

This was the figure given by Australian National University’s Dr Julie Smith in one of her two presentations during the Third International Conference on Wellbeing and Public Policy, co-hosted by Victoria University of Wellington, The Treasury and the International Journal of Wellbeing.

Smith said GDP is a further US$1.78 billion short of what it could be if all mothers were enabled by quality healthcare and social support and restraints on aggressive formula milk marketing to breastfeed at the biological optimum recommended by the World Health Organization (WHO).

The optimum, according to the WHO, is exclusively to six months and continuing to two years and beyond with safe and adequate complementary foods.

If prostitution, drug sales and other black market activities can be included in GDP, as they now are in the European Union’s European System of National and Regional Accounts, why not breastfeeding and mothers’ milk, asked Smith.

She cited estimates by a WHO-led research team in leading medical journal The Lancet that indicate New Zealand is also losing more than US$565 million a year because of the detrimental effect on IQ and therefore lifetime earnings of people whose early life nutrition was mainly formula milk rather than breastfeeding.

And, through a study of China, Malaysia, the Philippines, India, South Korea and Australia, she and colleagues estimate that sales of formula milk in 2017 in those six countries alone generated nearly 2.9 million tonnes of greenhouse gas emissions along the manufacturing process.

According to their calculations, every kilogram of formula milk creates around four kilograms of greenhouse gas emissions.

A significant proportion of that formula milk, which includes infant formula as well as so-called ‘growing up milk’ or ‘toddler formula’, would have originated in New Zealand.

Smith holds an Australian Research Council (ARC) Future Fellowship focused on the economics of breastfeeding and regulation of markets in mothers’ milk.

“When sales of formula increase, GDP goes up. It also goes up because the health expenditures go up. But when breastfeeding goes up, GDP declines. That’s pretty ridiculous really in terms of human wellbeing.”

She has been an expert adviser on economic aspects of breastfeeding to the WHO and the US Department of Health and Human Services, has contributed to Australian parliamentary inquiries on the subject, and has led other ARC-funded research projects surveying the time use of new mothers and breastfeeding support in workplaces and childcare.

Previously, she was a senior economist in the Australian and New Zealand treasuries and the Australian Departments of Finance, Environment and Prime Minister and Cabinet.

New Zealand, like many other countries, follows the principles of the United Nations’ System of National Accounts (SNA).

“Through how it conceives and measures the economy, the SNA and its primary indicator, GDP, has shaped social norms and public policy about what’s economically important,” said Smith.

“There’s sort of been an assumption that women’s care work, breastfeeding and things like that are not subject to monetary transaction and therefore not valued, and therefore not valuable.”

In her 1988 book If Women Counted: A New Feminist Economics, pioneering New Zealand feminist Marilyn Waring called the SNA “applied patriarchy” (“which I think is a wonderful description”, said Smith).

As national accounting expands to encompass environmental and other wellbeing factors, Smith sees an opportunity to redress the omission of breastfeeding and mothers’ milk.

“Some people, like Marilyn, now think the SNA is dead, it’s doomed, it’s not a useful way to go. But the reality is that GDP is going to be with us for a while. I think that if you’re going to address some of the gender biases in GDP, if you’re going to address some of the anti-environmental biases in GDP, then one way to explore that is to do experimental national accounts of breastfeeding and mothers’ milk.”

Mothers’ milk could be assigned an economic value as a good or commodity. In addition, ‘satellite accounts’, which have been promoted since 1993 to respond to weaknesses in GDP measurement of unpaid services, could measure the labour value of mothers’ time.

Smith’s survey of 156 new mothers in Australia showed that those exclusively breastfeeding a six-month-old baby spend up to nearly 20 hours a week doing so. “Essentially, it’s a part-time job, just feeding a baby,” she said.

There are a range of market prices you can put on mothers’ milk.

In fact, there are companies literally buying and selling it – paying, say, US50 cents to US$1 an ounce to mothers in Cambodia and selling it in the US for US$3–5 or US$100-150 per litre equivalent. One company sells pasteurised human milk to US neonatal units for vulnerable infants for US$300 a litre.

Smith’s GDP estimate for New Zealand, along with around 20 other countries, was based on US$100 a litre. This is its price in Norwegian hospital milk banks.

Against the GDP value of breastfeeding and mothers’ milk, with their health benefits, Smith put using formula milk and its consequences, citing estimates of the economic cost of acute illness in the US because of not breastfeeding at around $10 billion a year.

“A child who is not breastfed for several months loses on average somewhere between three and seven percentage points of IQ, which is equivalent to around three or four months of schooling lost during their lifetime,” she added.

Growth in formula milk use has decreased in high income countries in the past 10 years, but has been rapid in middle income countries such as China, Indonesia and Malaysia, with marketing attention shifting to middle and low income countries, targeting working mothers in particular, said Smith.

The number of mothers breastfeeding in China has more than halved in a decade, from around 66 percent in the 1990s to less than 30 percent now.

The Lancet study above estimated that around 20,000 women a year die from not breastfeeding, most in high income countries such as Australia, where in 2015 cancer epidemiologists estimated around 200 cases a year were due to low breastfeeding rates. China appears set to join these countries in the future, said Smith.

Women’s risk of reproductive cancer is about 20 percent higher if their lifetime breastfeeding duration is less than 12 months, she said.

What, she asked, is the ethical responsibility of exporting countries such as New Zealand and Australia in terms of public health consequences in overseas markets and environmental consequences at home and globally?

Formula milk sales are, of course, included in GDP, in New Zealand as elsewhere, she pointed out.

“When sales of formula increase, GDP goes up. It also goes up because the health expenditures go up. But when breastfeeding goes up, GDP declines. That’s pretty ridiculous really in terms of human wellbeing.”

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