Swaziland’s Minister of Finance Martin Dlamini misled the
people of the kingdom and the global community when he claimed the International
Monetary Fund (IMF) had given Swaziland an ‘almost clean bill of health’ on its
economy.
He was reacting in local media to the latest IMF statement
following its recent ‘mission’ visit to Swaziland.
In fact, the IMF statement
issued on 12 May 2014 said the opposite. It said Swaziland’s challenges were ‘significant’.
It said in particular that, ‘the economy has
suffered from weak growth performance, which adversely affects social
developments. Furthermore, there are risks to Swaziland’s economic prospects,
in particular the uncertain global and regional economic outlook that could
lower SACU [Southern Africa Customs Union] revenues.’
It went on say that Swaziland should make reforms
to its public sector, by which it meant reduce the amount of money spent on
public servants’ salaries.
‘To help implement the prudent fiscal policy, the
mission also encourages the authorities to enhance efforts for public sector
reforms and public financial management reforms, while welcoming further
efforts to enhance tax administration,’ it said.
It also said Swaziland had ‘weak growth performance’,
adding, ‘This weak performance has been largely associated with low private
sector development (depressed private investment in particular).’
It concluded, ‘In this light, the [IMF] mission
encourages the authorities to proceed with wide-ranging structural reforms,
including further improving business climate, facilitating financial
intermediation, and pursuing land management reforms.’
This is not the first time the Swaziland Government has
misled the public about its relationship to the IMF.
In 2013, the then Finance Minister Majozi
Sithole was untruthful when he said the kingdom’s economy had recovered. He
said at the time, ‘I can safely say the economy is now under control. We have
survived the worst economic challenges ever.’
But, the IMF had never said such a thing. Instead,
in February 2013 it
reported the Swaziland economy, ‘will be unsustainable over the medium term
and subject to significant downside risks’. It said there needed to be ‘upfront
expenditure cuts, including on the wage bill’.
The IMF said that in the recent past the government
had repaid some of its debt but this was ‘partly achieved through cuts in
education, health, and other poverty-alleviating spending’.
To underline the fragile state of the economy, the
IMF said, ‘Swaziland’s economic prospects remain difficult and that, without
credible and comprehensive fiscal adjustment and structural reforms, the
current fiscal and external position will be unsustainable over the medium term
and subject to significant downside risks.’
There are many similarities between the 2013 IMF report and
the one published this month, including poor economic prospects, underfunding of
social care projects and the need to reduce spending on public service spending.
The Swazi Government has a long history of being untruthful
about the IMF and what it says about Swaziland.
In 2011, the Prime Minister Barnabas Dlamini called a press
conference to announce that the IMF was about to issue a ‘letter
of comfort’ that would express its confidence in the Swazi economy and allow
the Government to seek loans from international organisations such as the
Africa Development Bank. But, no letter existed and since that date, the IMF
has never given its support to Swaziland’s economic policies.
See also
IMF CONFIRMS ECONOMY IN TROUBLE
NOT MUCH COMFORT FROM IMF
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