ESWATINI CUTS IMF DEBT BY OVER 50%, MOVES TO 2ND LOWEST

MBABANE - Eswatini has significantly reduced its debt to the International Monetary Fund (IMF) by over 50 per cent.

This has seen the country moving up to the second position among African countries with the lowest IMF debt.

The country, which ranked fourth in December 2024 with a debt of US$39 250 000 (equivalent to almost E723 189 033.28), now owes US$19 625 000 (E361 million) as of March 2025.

This marks a major improvement in Eswatini’s fiscal standing as it continues its efforts to manage its external obligations prudently.

Reduction

According to the latest figures from the IMF, Eswatini’s ranking has improved due to a substantial debt reduction, placing it ahead of Comoros, Sao Tome & Principe and Djibouti in the top 10 African countries with the lowest IMF debt.

Only Lesotho, with an outstanding IMF debt of US$11.66 million, has a lower obligation than Eswatini.

This development aligns with government’s broader strategy to reduce external borrowing and improve debt sustainability. In January, Finance Minister Neal Rijkenberg reaffirmed government’s commitment to clearing its E2 billion IMF loan by 2025.

This loan, secured four years ago in response to the economic challenges brought by the COVID-19 pandemic, supported critical projects in education, health and energy sectors. Some of the key initiatives funded include the construction of the 132kV electricity line connecting Nhlangano and Lavumisa, as well as water supply projects at Mhlosheni and Zombodze Emuva in the Shiselweni Region.

Resilience

Nations with minimal IMF debt are better positioned to promote long-term growth and economic resilience. IMF loans have always been a two-edged sword for African countries. While they offer much-needed financing during economic downturns, they frequently come with strict terms that necessitate austerity measures.

A low IMF debt indicates sound fiscal management, which boosts economic expansion and investor confidence.

Compared to the list of the 10 countries with the lowest debt to the IMF last month, countries including Eswatini and Equatorial Guinea, saw a reduction in their debt load in March.

Despite this positive step in reducing IMF debt, Eswatini continues to manage its obligations with other international financial institutions, including the World Bank and the African Development Bank (AfDB).

As of February 2025, the country’s total public debt stood at E35.6 billion, representing 37.3 per cent of GDP. Government remains committed to ensuring that public debt remains below 45 per cent of GDP, a target outlined by the minister for Finance to maintain fiscal stability and investor confidence.

Reducing IMF debt enhances Eswatini’s economic flexibility, allowing government to implement policies without stringent external conditions. A lower debt burden also signals sound fiscal management, which is crucial in attracting investment and fostering long-term economic growth.

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