The economy in Swaziland (eSwatini) continues in
free-fall. Public debt is still rising, domestic arrears have grown, and international
currency reserves have fallen ‘below adequate levels,’ the International
Monetary Fund (IMF) reported.
The growth in private investment is slowing and declining external
competitiveness is hindering the kingdom’s growth prospects. Now, 40 percent of
the population is living in extreme poverty and unemployment is high.
The IMF report published on Tuesday (11 February 2020) came after the
group’s latest visit to the kingdom ruled by absolute monarch King Mswati III.
The IMF reported, ‘Economic indicators are expected to
remain weak. GDP growth [the total value of goods and services in the kingdom] is
projected to temporarily pick up in 2020, as the government plans to repay some
arrears, but growth would be subdued afterwards as fiscal imbalances persist
and the private sector remains hamstrung.’
The IMF predicted the government’s deficit was
expected to remain large and public debt would rise to above 60 percent of GDP
over the medium-term and contribute to further reduce international currency reserves.
Swaziland’s economy has been in freefall for many
years. The government which is not elected by the people but handpicked by King
Mswati has failed to pay its suppliers. Public services across the kingdom have
ground to a halt with reports
of people dying for lack of medicines and children
going hungry because the government was unable to pay suppliers of meals
for children.
Last week (5 February 2020) Swazi Minister
of Finance, Neal Rijkenberg said government
suppliers and service providers would have to wait six more weeks for their
payments. The government had previously promised payments would be made by the
end of January 2020. Previously, the deadline for payment had been set at the end
of September 2019.
It is unclear how much the government owes and it has itself reported
the figure as E4.2 billion and E2.2 billion.
Rijkenberg reported the Office of the Auditor General
and the Office of Internal Audit were trying to verify how much was owed.
In November 2019 the Swazi parliament
approved a bill to allow government to seek a E2 billion loan from the AFREXIM Bank to clear arrears and for
other expenditure.
In 2017 Business
Insider reported King Mswati had a net worth of US$200 million (about
E3 billion in local Swazi currency). The King rules a population of about 1.3
million people and seven in ten of them live in abject poverty with incomes of
less than E30 per day.
See also
Swaziland
breaks promise to pay off its suppliers to halt public services meltdown
More
deaths in Swaziland as government fails to pay medicine suppliers
Swaziland
schoolchildren learn under trees or in tents as government runs out of money
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