eSwatini’s Prime Minister, Russell Dlamini, has announced a significant financial milestone for the country. The African Development Bank (AfDB) has approved a loan of approximately R2.4 billion to develop key infrastructure projects. The funding will focus on upgrading road networks in the Lubombo and Shiselweni regions, areas identified as critical to improving connectivity and driving socio-economic progress.
A Strategic Approach to National Development
Speaking at the Government’s One Year in Office Performance Report briefing in Mbabane, Dlamini revealed that the Ministry of Finance had been tasked with expediting a national borrowing plan to channel resources effectively.
“The AfDB’s approval of this loan is a significant step towards achieving our infrastructure goals,” Dlamini said. He highlighted the government’s ongoing efforts to overhaul the country’s procurement system to eliminate inefficiencies and reduce costs, noting that the existing Procurement Act of 2011 posed significant limitations to effective service delivery.
Clearing Debt and Strengthening Fiscal Stability
One of the key achievements reported by Dlamini was the reduction of government arrears owed to local companies. Outstanding debts decreased from E2.8 billion to E700 million in a year, reflecting a 75% reduction. This progress aligns with broader efforts to stabilise eSwatini’s economy and restore trust among domestic stakeholders.
Credit Rating Upgrade: A Boost for Investor Confidence
A pivotal moment for eSwatini came on 25 November when Moody’s Investors Service upgraded the country’s long-term credit ratings from B3 to B2. This improvement reflects the government’s strides in fiscal management and policy implementation.
Moody’s commended the country for achieving a primary surplus in the 2023 fiscal year and its commitment to fiscal consolidation. The agency predicted that eSwatini’s debt would stabilise around 40% of GDP, considerably lower than many similarly rated nations.
The upgrade also recognised eSwatini’s strong integration with regional economies and its relatively high wealth levels compared to peers. This stable outlook is expected to attract more investment opportunities and reduce borrowing costs, paving the way for sustainable economic growth.
Driving Reforms for Economic Advancement
To further enhance fiscal accountability, the government is implementing financial management systems such as the International Public Sector Accounting Standards (IPSAS) and an Integrated Finance Management and Information System (IFMIS). These systems aim to improve financial reporting, streamline cash management, and support efficient resource allocation.
Economic Prospects and Regional Integration
eSwatini’s economy, while still developing, relies heavily on agriculture and trade with partners like South Africa, China, the United States, and the European Union. The AfDB loan, coupled with the recent credit rating upgrade, positions the country favourably for greater economic integration and growth.
The Prime Minister emphasised that these milestones mark a turning point for eSwatini, reflecting the government’s commitment to economic reform and infrastructure development. “This is a clear signal to investors and our people that eSwatini is on a path to stability and prosperity,” Dlamini concluded.
