ESWATINI’S TRADE INDICATES POSITIVE ECONOMIC GROWTH

MBABANE - When exports exceed imports, the net exports figure is positive and this indicates that a country has a trade surplus. 

Conversely, when exports are less than imports, the net exports figure is negative and this indicates that the nation has a trade deficit. 

In the case of Eswatini, exports exceed imports meaning that the country has a trade surplus and the latter contributes to economic growth in a country. 

merchandise

This is informed by the Eswatini’s merchandise trade comparison between January-May 2019 and January-May 2020 which depicts that the value for exports is more in both periods than the value for imports. When there are more exports, it means that there is a high level of output from a country’s factories and industrial facilities, as well as a greater number of people that are being employed in order to keep these factories in operation. 

When a company is exporting a high level of goods, this also equates to a flow of funds into the country, which stimulates consumer spending and contributes to economic growth. 

According to a Tralac report, Eswatini’s exports for the first five months of 2019 and 2020 were valued at E11.7 billion (US$761.84 million) and E9.2 billion (US$601.88 million), respectively and the difference is E2.5 billion. 

amounted

 On imports, the first five months of 2019 and 2020 amounted to E11.1 billion (US$723 million) and E8.8 billion (US$571 million), respectively and the difference is E2.3 billion. 

These projections from the report depict that Eswatini has more exports than imports and the difference in value between the imports and exports in the first five months of 2020 is E400 000.

According to a business.com, a healthy economy is one where both exports and imports are experiencing growth. 

This typically indicates economic strength and a sustainable trade surplus or deficit.

declined

 If exports are growing, but imports have declined significantly, it may indicate that foreign economies are in better shape than the domestic economy.

 Conversely, if exports fall sharply, but imports surge, this may indicate that the domestic economy is faring better than overseas markets. An economist who spoke on condition of anonymity stated that this means the country was doing well as productivity is high. The economist said if exports are greater and the country was selling more, it meant more income and it creates space for investments and creation of jobs. 

“The more we produce, the more opportunities for employment. 

This could also help government in bringing down the debt stock and paying of business suppliers as the country is generating more income. It also attracts investors into the country,” she said. 

projections

The economist also mentioned that the projections of the merchandise trade showed that the private sector was taking advantage of the trade agreements that the country had and it was also taking advantage of the demand regionally and internationally. 

The country’s merchandise trade comparison in 2019 and 2020 in the stipulated period was reported by Tralac, looking at the Eswatini Revenue Authority (SRA) statistics. Tralac is an organisation that is closely monitoring trade-related policy measures and responses to the COVID-19 pandemic adopted and implemented by African countries and beyond. 

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