MYSTERY OF SWAZI KING’S $10m ‘LOAN’

There is a mystery as to why King Mswati III of Swaziland needed a US$10 million loan from the company running the Ngwenya Iron Ore Mine.  

The company had a cash-flow crisis after the King’s representative Sihle Dlamini halted all sales of iron ore in August 2014. When the King was asked to repay part or all of the loan to save the company he refused. The company then went out of business owing creditors about US$4 million and more than 700 people lost their jobs.

The King asked for and was granted the loan in April 2012, shortly after he gave a mining licence to a company called Salgaocar Swaziland to operate at Ngwenya.

Salgaocar Swaziland was the original name of SG Iron Ore Mining (PTY) Ltd (SG Iron). SG Iron was 50 percent owned by Southern Africa Resources Ltd (SARL), 25 per cent by the Swaziland Government and 25 percent by King Mswati in trust for the Swazi nation.

SARL has lodged an arbitration case claiming US$141 million against the Kingdom of Swaziland stating that the company failed in 2014 after only being in business for two years because the King’s representative Sihle Dlamini halted all sales of iron ore. It said a major reason it did this was because the King, who rules Swaziland as sub-Saharan Africa’s last absolute monarch, did not want to repay the loan.

It also stated that the closure and subsequent court order winding up the company was an attempt by Swaziland to illegally seize the assets of the company. The Swazi High Court wound up the company in December 2014 and it was liquidated on 30 January 2015.

It is not clear why King Mswati needed the US$10 million loan, since he sits on a personal fortune amassed at the expense of his subjects.

In August 2014 the Sunday Times newspaper in South Africa reported King Mswati personally received millions of dollars from international companies such as phone giant MTN; sugar conglomerates Illovo and Remgro; Sun International hotels and beverages firm SAB Millerto.

In its report the Sunday Times said the companies, which are based in South Africa, ‘have all brokered cosy relationships with the monarchy’.

It added, ‘These companies have either given large chunks of the shares in their Swazi businesses to Mswati directly or to Swaziland’s investment institution, Tibiyo Taka Ngwane over which Mswati has absolute control.’

It reported that MTN, which has a monopoly of the cell phone business in Swaziland, paid dividends directly to the King. He holds 10 percent of the shares in MTN in Swaziland and is referred to by the company as an ‘esteemed shareholder’. It said MTN had paid R114 million (US$11.4 million) to the King over the past five years.

The newspaper also reported that the King was receiving income from Tibiyo Taka Ngwane, which paid dividends in 2013 of R218.1 million. The newspaper reported ‘several sources’ who said it was ‘an open secret’ that although money generated by Tibiyo was meant to be used for the benefit of the nation, Tibiyo in fact channelled money directly to the Royal Family.

The newspaper quoted a report from Freedom House which stated, ‘Foreign companies wishing to enter Swaziland must bribe Mswati with shares or cash in varying amounts depending on the potential for profitability of the proposed venture and the new business’s possible impact on Mswati’s own business interests.’

The Sunday Times reported that MTN had a monopoly in Swaziland and was used by 57 percent of the population. It said MTN was able to keep prices high, citing the cost of 300 megabytes of data in Swaziland as R149, while in South Africa the same amount of data cost R79.

King Mswati holds substantial stakes in numerous companies. The Sunday Times said sugar giant Illovo owned 60 percent of Ubombo Sugar and Tibiyo owned the other 40 percent. Tibiyo also owned 40 percent of Royal Swazi Spa hotel of which Sun International held an ‘indirect’ 50.6 percent stake.

Remgro’s sugar subsidiary TSB owned a 26.4 percent stake in the Royal Swaziland Sugar Corporation and Tibiyo held 50 percent. SAB Miller, which owned 60 percent of Swaziland Beverages was in business with Tibiyo, which owned the remaining 40 percent.

In 2009, Forbes magazine estimated that the King himself had a personal net fortune worth US$200 million. Forbes also said King Mswati was the beneficiary of two funds created by his father Sobhuza II in trust for the Swazi nation. During his reign, he has absolute discretion over use of the income. The trust has been estimated to be worth US$10 billion.  

All this is happening while seven in ten of Swaziland’s tiny 1.4 million population live in abject poverty with incomes less than US$2 a day; three in ten are so hungry they are medically diagnosed as malnourished and the kingdom has the highest rate of HIV infection in the world.

At the last national budget in Swaziland in 2014 the King’s annual household budget increased by more than 10 percent to US$61m, this was on top of the 13 percent increase he had in 2013.

The AFP news agency reported in May 2014 that the figure also included provisions for construction work on palaces that would cost the tax payer about $12.6m.

The King has taken huge increases in his slice of the Swaziland budget in recent years.

In the Swazi national budget introduced in February 2012 King Mswati and his royal family received E210 million (US$21 million) a year from the Swazi taxpayer for their own use. This was the same amount they got in the financial year 2011/12, but was an increase of 23 percent over 2010/11 and a 63 percent compared with what the King took from his subjects in 2009/10.

Observers note that the King has had many chances in the past to cut back on his spending and reduce the amount of money he takes from his subjects, but so far he has increased his budget, rather than reduced it. In 2011, as Swaziland hurtled towards financial meltdown, Majozi Sithole, the then Finance Minister, in his budget demanded 10 percent budget cuts (later increased further) from government departments, but in the same budget the amount of money given to the King increased by 23 percent.

Despite the poverty of the kingdom, King Mswati continues to live a lavish lifestyle. He has 13 palaces, fleets of top-of-the-range Mercedes and BMW cars and at least one Rolls Royce.

In 2012 he acquired a private jet. He refused to say who had paid for it, leading to speculation that the money came from public funds.

The King travels abroad in style. In May 2012  he went to London to visit Queen Elizabeth II for lunch on a trip estimated to cost US$794,500.  

The previous year he was in London with a party of 50 people for the wedding of Prince William and Kate Middlelton, staying at a US$1,000 per night hotel on a trip that was also estimated to cost US$700 000 for the hire of a private jet to take the King and his party from Swaziland to the UK.  

In 2012 Queen LaMotsa, the second of the King’s wives, stayed at a Johannesburg hotel on a personal trip at a cost of US$60,000 a month. 

In July 2012, some of the King’s 13 wives went on a shopping trip to Las Vegas, where 66 people reportedly stayed in 10 separate villas – each costing US$2,400 per night. The party were reported by South African newspapers to have travelled by private jet which might have cost US$4.1 million.

See also

KING AT CENTRE OF IRON MINE FAILURE

http://swazimedia.blogspot.com/2015/02/king-at-centre-of-iron-mine-failure.html

 

ONLY KING GAINS FROM MINE FAILURE

http://swazimedia.blogspot.com/2015/02/only-king-gains-from-mine-failure.html

HYPOCRISY OF KING MSWATI III

http://swazimedia.blogspot.com/2012/02/hypocrisy-of-king-mswati-iii.html

‘TIMES’ SIDES WITH TV AGAINST QUEEN

The Times of Swaziland reported the news that King Mswati’s 12th wife Inkhosikati LaDube had been thrown out of the royal palace – but only to let Swaziland’s ‘traditional prime minister’ Timothy Velabo (TV) Mtetwa deny that it was true.

It had been expected that the Times, along with all other media in Swaziland, would censor the news because it was embarrassing to the King.

The report that LaDube had pepper-sprayed a royal guard who refused to let her leave the palace started in South Africa’s Sunday Times yesterday (20 November 2011) and quickly spread around the world.

Today, the Times, the kingdom’s only independent daily newspaper, gave Mtetwa space to deny it ever happened. The Queen, who last year was involved in a love affair with then Minister of Justice Ndumiso Mamba, had not been exiled, she was simply away visiting her grandmother, he said.

Oh, and the Times didn’t say the bit about the love affair because that’s censored information that the Swazi people aren’t allowed to know.

Mtetwa responded to the media reports of LaDube’s expulsion with ‘shock and anger’, the Times reported.

The newspaper reported Mtetwa ‘wondered where the South African media got the story which he described as untrue’. That was a strange thing for it to say because the Sunday Times made it clear it got the story from Queen LaDube herself and quoted her extensively. Mtetwa claimed to have read the South African media reports so why did he ask such a question?

And, if he genuinely didn’t know, why didn’t the Times of Swaziland tell him – and its readers for that matter.

Instead, it allowed Mtetwa, who was implicated in the original media report, to suggest that the South Africans just made the story up off the top of their heads. The Times of Swaziland didn’t interview LaDube for her side of the story.

Mtetwa, the most senior of the traditionalists in the kingdom, ruled by King Mswati III, sub-Saharan Africa’s last absolute monarch, had been accused in the original report of personally ordering LaDube to leave her palace after she pepper-sprayed the guard.

King Mswati was not present at the eviction; he is in seclusion, which may explain why Mtetwa ran to the Times of Swaziland. He wanted to get his retaliation in first, before the King heard about what he had done and dropped a ton of you-know-what on his head from a very great height.

See also

KING’S WIFE THROWN OUT OF PALACE

http://swazimedia.blogspot.com/2011/11/kings-wife-thrown-out-of-palace.html

KING’S WIFE THROWN OUT OF PALACE

Inkhosikati LaDube, the 12th wife of Swaziland’s King Mswati III, who last year was involved in a love affair with a cabinet minister, has been kicked out of the royal palace following a fight with a security guard. She said she pepper-sprayed him in the eyes to protect herself.

The Sunday Times newspaper in South Africa reports today (20 November 2011), ‘Inkhosikati LaDube [also known as Nothando Dube] was ordered to “immediately leave the palace” by royal governor Timothy Mthethwa, who was accompanied by other senior members of the royal family.’

The news will not be published by the media in Swaziland because they have a long-standing agreement not to report on King Mswati without his permission.

The Sunday Times says LaDube, aged 23, told the newspaper she had had an argument with a security guard who refused to let her out of the palace last Saturday.

She wanted to take the youngest of her three children, aged two, to hospital after she had injured herself while playing - but the guard said she was not allowed to leave.

‘[He] threatened to hit me, saying I am not going anywhere with my child, who was bleeding from a deep wound,’ she told the newspaper.

LaDube says an altercation ensued and she was ‘physically prevented’ from leaving the palace. ‘I had to protect myself so I [pepper]-sprayed him in the eyes.’

The matter was reported to the Queen Mother, who, the Sunday Times reports, apparently decided that LaDube had been disrespectful and had to be kicked out.

‘I couldn't even take all my stuff, because they just said “you have to pack and leave now”,’ she said. Her children remain at the palace.

The Sunday Times is usually on sale in Swaziland so we shall have to see if copies are pulled from the shelves today.

After LaDube’s love affair with the then Justice Minister Ndumiso Mamba was revealed in August 2010 by the City Press, another South African newspaper usually available in Swaziland, security forces were reportedly dispatched around the kingdom to buy up all copies.

TIMES BOSS: WHO NEEDS DEMOCRACY?

Paul Loffler, publisher of the Times of Swaziland newspapers, says Swaziland doesn’t need democracy.

He is quoted by a South African newspaper today (5 June 2011) saying the Swazi cities are clean and the local municipalities work fine, so there’s little to complain about.

Loffler, who with his family is based in Namibia, was quoted by the Sunday Times newspaper in South Africa.

It was reporting on how Swaziland was ‘open for business’ despite the recent increases in protests from workers demanding democratic reforms in the kingdom ruled by King Mswati III, sub-Saharan Africa’s last absolute monarch.

Loffler owns the only major media in Swaziland that is not under state control or in effect owned by King Mswati. His titles are the Times of Swaziland, the Swazi News and the Times Sunday.

He was quoted by the Sunday Times saying, ‘Swaziland doesn’t need democracy. We’ve never had a genocide, we’ve never nationalised farms, our municipalities run like clockwork, the cities are clean, there are no potholes - or not many - and we have little violent crime.’

The newspaper went on to report that ‘he admitted, there is room for improvement, particularly regarding the profligate spending on unnecessary items in the face of dire poverty. The king’s proposed jet, for example - rumoured to cost in the region on $45-million - is a sticking point for many, as are the palaces, expensive cars, overseas holidays and extravagant shopping trips for the king’s wives and children.’

Lofler inherited the Times newspapers from his father Douglas Loffler.

In March 2010, Paul Loffler announced that he was to sue a tiny independent newspaper in Swaziland, the Swazi Mirror, after it reported that Loffler paid himself E1 million a month from his newspapers, while his staff worked for low wages. His lawyers said the report ‘implied our client is greedy, selfish and has no regard for the employees’ welfare’.

The Times group has a long history of kowtowing to King Mswati. In March 2011 it censored coverage from foreign media that criticised the king’s undemocratic regime; in August 2010 it censored a paid advertisement that drew attention to the king’s publicly-stated refusal to engage in dialogue with democracy advocates.

In 2009, it dropped the column written by Mfomfo Nkhambule that was mildly critical of the royal regime in Swaziland; in May 2009 Loffler personally grovelled publicly to the king after his newspaper reported truthfully that the king had purchased a fleet of Mercedes cars.

In March 2007, the Times Sunday published a report from the international news agency Afrol that criticised King Mswati and included a reference to the king’s spending, ‘Swaziland is increasingly paralysed by poor governance, corruption and the private spending of authoritarian King Mswati III and his large royal family.’

The article went on to say, ‘The growing social crisis in the country and the lessening interest of donors to support King Mswati’s regime has also created escalating needs for social services beyond the scale of national budgets.’

King Mswati threatened to close down the Times group unless an unreserved apology was printed. It was, and the newspapers survived.

SWAZI UNIONS FEAR POLICE RAIDS

Labour unions and civic society organisations in Swaziland have placed themselves on alert after what is being described ‘as credible information’ was received that they are about to be raided by Swazi state authorities in an attempt to disrupt the ‘uprising’ scheduled for next Tuesday (12 April 2011).

King Mswati III, sub-Saharan Africa’s last absolute monarch, and the government he handpicks, have become increasingly worried about the ‘uprising’ that is being coordinated by a Facebook group.

Yesterday, it was revealed that Swazi government representatives had approached the crack South African police squad the Hawks to ask it to monitor the movements of the Swaziland Solidarity Network, a Johannesburg-based organisation that is one of the bodies publicly supporting the ‘uprising’. According to the Sunday Times, a South African newspaper, the Hawks refused.

Today (4 April 2011), it became public that labour unions in Swaziland planned a three-day protest next week, starting on 12 April.

Meanwhile, a report that cannot be independently verified is circulating that some foreign country ambassadors based in Swaziland approached King Mswati prior to the 18 March demonstrations that attracted about 8,000 people and warned him that if his state police or army caused violence during the protests there would be consequences from the international community.

Unusually for Swaziland, the protest which was demanding the immediate resignation of the entire government, passed peacefully.