We are still awaiting leadership from Swaziland’s Finance Minister
Majozi Sithole as the kingdom hurtles toward economic disaster.
Last week Sithole
admitted that he and the Swazi Government were not prepared for the massive reduction in receipts from the
Southern African Customs Union (SACU).
This was even though politicians and economists had been warning for more than a year that the
cut was on the way. Swaziland will get
E1.9 billion (250 million US dollars) this year compared to at least E6 billion received in
previous years. SACU receipts accounted for 66 percent of the national budget last year, from 71 percent in the
previous year. Still there is no plan to get Swaziland out of the economic mire. Instead there is wishful thinking and finger pointing.
The latest idea is to attract more foreign direct investment (FDI) into the kingdom. Secretary General of the Swaziland Federation of Trade Unions (SFTU) Mduduzi Gina said,
‘We want FDI that will make the country grow’.
He is not alone in this. Last week
King Mswati III, sub-Saharan Africa’s last absolute monarch, writing in the international magazine
FIRST, said Swaziland
‘continues to use its resources and capabilities to expand investment opportunities for both foreign and local business, as part of our national strategy for socio-economic growth’.
Sorry but it’s not going to happen. Surely if Sithole and his king have been paying attention they will know there is next to no FDI to attract.
In March 2009, before the G20 meeting of most powerful industrialised nations in London, it was announced that
experts predict that FDI – the flow of cash from foreign companies into developing countries – will fall by 80 percent from 929 billion US dollars in 2007 to 165 billion in 2009.
Even the little FDI that is out there will not come to Swaziland as the
Swazi Observer, the newspaper in effect owned by King Mswati,
reported last month (November 2009), Swaziland is
not deemed as a good place for investors to set up business because of its small market, its people are too poor and Swaziland’s limited international reputation as a destination for foreign direct investment.
Sithole said Swaziland
could try to borrow money to get out of the crisis through the use of budget support, where the borrower doesn’t lend to the kingdom as a whole, but just looks at individual programmes it has in place and finances them one by one.
Often this ‘budget support’ comes in the form of development aid.
Sithole had better not go to the United Kingdom cap in hand for his money. The UK
Conservative Party, which is widely expected to win the General Election due in the first half of 2010,
has stated it will only give budget aid to ‘countries where we are satisfied that our duty to the British taxpayer can be discharged through transparency and accountability for the way the funds are used and the results they deliver’.
As Sithole himself
admitted last week the country needs to fight corruption which he said drains some E40 million a month (5.4 million US Dollars) from the national coffers.
According an editorial in the
Observer, those engaged in corruption are ‘the government people, business people, cabinet ministers, Members of Parliament, journalists, police and army officers who line their pockets with money otherwise earmarked for development projects’.
Sithole himself blamed
Swaziland’s customs officials, who he said collude with thugs to rob the kingdom of millions of Emalangeni.
So with all that corruption there’ll be no aid from the UK for Swaziland.
The Swaziland Government will have a hard time persuading ordinary workers in Swaziland that they need to shoulder the burden of the economic crisis.
After suggestions from Sithole that
civil servants might forego their recently-announced salary increases, the Secretary General of the National Public Service and Allied Workers Union (NAPSAWU) Vincent Dlamini said workers should not be penalised for the crisis.
Dlamini said that
government probably knew about the crisis and should have done something about it years ago.
‘Government should have tried to source revenue elsewhere. We cannot not be made to pay for this. Government talks efficiency and if this is to be achieved, civil servants need to be fairly remunerated,’ he said.
Other workers are not ready to take the fall for Sithole either. Swaziland Federation of Labour (SFL)’s Secretary General Vincent Ncongwane
said they would use all tools at their disposal to defend workers’ interests. He said government should first look at cutting the amount of money it paid to politicians, as well as intensify methods of fighting corruption instead of targeting workers.
