NO LEADERSHIP ON SWAZI MELTDOWN

Where in Swaziland is the leadership to save the kingdom from economic catastrophe?

Not with Barnabas Dlamini, Swaziland’s illegally-appointed Prime Minister. He has his head stuck firmly in the sand.

Last week, the Central Bank of Swaziland could sell only one-fifth of the E750 million worth of financial bonds it needed to raise to meet the government’s short-term spending commitments.

This week it was admitted that the government did not have the money to pay for an early retirement scheme to pay off some of the 7,000 public servants it needs to shed, under instructions of the International Monetary Fund (IMF), if Swaziland is to be supported in a loan application to the African Development Bank.

Following the shortfall from the bonds, there are serious doubts about Swaziland’s ability to pay wages for much longer, or to finance retrenchment packages for the public servants.

But when questioned by journalists yesterday (2 February 2011) about the financial meltdown in the kingdom he had no response to Swaziland’s immediate crisis.

Instead, he told the Swazi people, they must wait two weeks to see what will be in the budget presented by Majozie Sithole, the Finance Minister.

With breathtaking complacency, he told reporters that if Swaziland didn’t get support from the IMF, ‘... we will be in trouble even during the next financial year’.

Swaziland is on the abyss now. The IMF and the government agreed a short-term plan to help Swaziland through the coming months. A central plank of this plan was that the Swazi Government would raise money on the international financial markets to pay its bills, especially wages, over the coming months.

With the failure to raise money from the international markets, the IMF / Government plan is in tatters. The Swazi Government needs to tell the people right away what its next move is.

Dlamini is not the only one who can’t see the seriousness of the situation. Last week, King Mswati III, sub-Saharan Africa’s last absolute monarch, told his subjects that prayer would save the kingdom from the economic meltdown.

SWAZI ECONOMY ON EDGE OF ABYSS

Just when you thought Swaziland’s economic crisis couldn’t get any worse, it does. The Swazi Government that is being forced to sack 7,000 public servants says it no longer has the money to pay for early retirements.

Evart Madlopha, Principal Secretary at the Ministry of Public Service said, ‘We seriously have a problem of cash flow at the moment due to the financial crisis faced by the country.’

Now, there must be serious doubts about whether the government has money for redundancy payments of any kind for the civil servants.

The Swazi Government promised last year (2010) to put aside E65 million (US$9 million) in an Enhanced Voluntary Exit Retirement Scheme (EVERS) that would allow people to retire after 10 years service. Some people would be able to retire aged 45.

The news that the money is not there comes less than a week after the Swaziland Government managed to sell only one-fifth of the E750 million worth of bonds it needed to on the financial markets. The money from the sale was meant to pay the government’s bills in the short term.

With that failure, the Swazi economy is close to the abyss. The International Monetary Fund (IMF) is demanding 7,000 public service job cuts and a raft of cuts in public expenditure and financial reforms in return for supporting Swaziland’s application for a loan from the African Development Bank.

What happens next is unclear. Barnabas Dlamini, Swaziland’s illegally-appointed Prime Minister, has already voiced concerns that job cuts could lead to civil unrest. It is estimated that in Swaziland every civil servant salary supports 10 family members. If civil servants are forced out of work the social consequences are huge. They will be even greater if the civil servants are sent home with no pay-offs.

King Mswati III, sub-Saharan Africa’s last absolute monarch, will be aware of events in Tunisia and Egypt where dictatorships have toppled after social unrest. Many of the people who led the protests were from the ‘middle class’, but unemployed.

Now Swaziland is putting 7,000 middle class civil servants and their tens of thousands of dependents on the scrapheap. Who can predict what happens next?