ESWATINI NSHORT-TO-MEDIUM TERM ECONOMIC GROWTH OUTLOOK AVERAGING 4%

MBABANE – Eswatini’s growth outlook is envisaged to be positive in the short-to-medium term (2024 – 2026), averaging 4.0 per cent.

The growth is underpinned by both demand and supply factors. Manufacturing activity is expected to contribute to higher growth in the medium term, benefiting from completed and ongoing expansions in different industries boosting supply capacities. Under the manufacture of beverages, the industry is anticipated to increase production capacity backed by new investment in plant capacity and a warehouse, an investment that was worth over E200 million. Furthermore, the textile industry, which has been constrained for the past three years, is expected to rebound in line with new investment in firms (i.e., Gamula, Jonson and Jonson factories) as well as capacity expansions in existing firms.

Other food manufacturing, particularly sugar processing, is also expected to benefit from supply capacity expansions. The ongoing expansions under the LUSIP II project are expected to boost sugar production in the medium term, with ongoing cultivation earmarked to add 4 500 ha to sugarcane output by the year 2025. However, emerging demand factors are a major risk for the manufacturing sector in the short-to-medium term. These factors include the uncertainty with regards to recovery and the stability of global demand, as well as supply chains, influenced by the perpetual geopolitical tensions, and the high volatility of global commodity prices.

Export-oriented

Additionally, structural challenges and weak economic activity in the RSA economy (the country’s key trading partner) pose negative repercussions for the export-oriented manufacturing subsector in the domestic economy.  The construction subsector is also expected to be among the key contributors to economic growth in the short-to-medium term. Ongoing activity under the multibillion MNWAP3 coupled with other private sector projects including energy-related projects are expected to boost activity under the construction subsector and stimulate growth in other supporting sectors such as the wholesale and retail, Transport, and Professional services.

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