GROSS RESERVES UP 20 PER CENT

MBABANE - The country’s gross official reserves were recorded at an improved E9.6 billion at the end of the past month.

According to the monthly statistical release covering December 2020 and the past month from  the Central Bank of Eswatini, the reserves figures improved  by 20.3 per cent month-on-month and 40.7 year-on-year to settle at  the said E9.6 billion at the end of January 2021. The growth in reserves, according to the report, was largely due to the inflow of quarterly Southern Customs Union (SACU) receipts during the first week of the past month. 

Imports

As a result, the import cover rose to 4.2 months of imports of goods and services from 3.5 months observed in December last year.

Valued in special drawing rights (SDR), the reserves amounted to SDR443.2million at the end of January 2021 representing growth of 17.3 per cent compared to the previous month and 33.6 per cent compared to the previous year.

Rules guiding reserve adequacy suggest that countries should hold reserves covering 100 per cent of short-term debt or the equivalent of three months worth of imports.

Meanwhile, according to the report, credit extended to the private sector amounted to E15.8billion at the end of December 2020, reflecting an increase of 2.1 per cent month-on-month and 6.7 per cent over the year. 

Sectors

“The month-on-month growth was evident in credit to other sectors and businesses while credit to households and non-profit institutions serving households (NPISH)) declined over the review period. 

Credit to other sectors increased by 12.6 per cent over the review month and 40.8per cent annually to close at E1.9 billion at the end of December 2020.The month-on-month improvement was driven by credit to other financial corporations and public nonfinancial corporations which grew by 19.3 per cent and 1.1 per cent, respectively,” reported CBE.

On the contrary, credit to local government fell by 1.6 per cent over the month under review.

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