OUR VULNERABILITIES EXPOSED

THE Eswatini economy is not designed to stand on its own to survive any serious shock or crisis should it be cut off from South Africa. Our economic system is deeply rooted and dependent on South Africa to a point that our neighbour is increasingly becoming a limiting factor to the sustainability of Eswatini’s economy. 

Of course, Eswatini, like many Southern African Customs Union (SACU) member states, needs South Africa to keep its trade alive; however, not all trade and economic survival has to be about South Africa. Being landlocked seems to have given government every reason imaginable to also lockdown our economy to SA’s economy too. Being close to a giant economy like South Africa can be a huge disadvantage for small economies if they become too dependent on it to a level that nothing happens in the small economy without touching base with the giant economy for fear of being cut off from the benefits of rubbing shoulders with the giant economy.

It is a fact; everything we consume and a majority of our economic policies are tied to South Africa. About 90 per cent of Eswatini’s imports come from South Africa and 70 per cent of our exports are destined for South Africa. At the same time, Eswatini’s responses to any global economic shocks, pandemics, and regional crises largely depend on SA. The problem is that when South Africa puts its people first or when things ‘go south’ in that country, Eswatini comes to a standstill. 

Firstly, it was the pandemic that exposed just how vulnerable we are as an economy when South Africa decided to shut its borders during the first lockdown at the onset of the COVID-19 pandemic. The result was an unavoidable hike in food prices in Eswatini and other essential commodities as SA rationed essential commodities it was exporting to other countries, including Eswatini. SACU did not protect us then. Secondly, it was the fuel shortage experienced over the Christmas weekend, which proved just how much Eswatini is ridiculously in need of South Africa, even for the most basic factors of production, that is, fuel. SACU did not come to our rescue.

Access

Jokes aside, SACU is not meant to protect us from anything: it is just a trading bloc that is meant to enhance access to markets and enable free movement of goods and services in order for Eswatini to realize its national trade aspirations, including the goal of being an export-led economy. The issue now is that SACU has become convoluted to more than just a trade bloc for government. It is now a cash cow for government revenue that is overtaking all other economic and social policy aspirations the country could ever imagine. Should SACU cease to become government’s personal ATM, Eswatini’s economy would become history.

Government should stop putting all its eggs in one basket. It needs to think of viable alternatives to protect the integrity and sustainability of the economy beyond our crutch, South Africa. The issue is not that the country must let go of SACU or cease to trade with South Africa – that would be equally ridiculous. Instead, government must invest in other economic options to cut the dependency on one trade partner or regional trade bloc.

We are a sovereign nation after all; our government is tasked to deliver a standard of living for all emaSwati akin to those of First World nations. Tying the economy down to one neat box of policy options will not achieve this dream! 

Achieved

What government has achieved in the past 20 years since the inception of the National Development Strategy (NDS) in 1997 is simply positioning Eswatini for South African businesses to make billions through our economy. Take this for the fruits of the NDS; Eswatini imports almost all of its electricity from South Africa and almost all our fuel comes from South Africa. Our food comes from South Africa, even our staple food, which NMC is always happy to import from that country to the detriment of smallholders in Eswatini. Our commercial banks are South African and are making a killing in Eswatini while Eswatini Bank is just another government department. One of the country’s biggest investments – King Mswati III International Airport – is also being used to prop up a South African airline. The television most emaSwati consume is proudly South African through Multichoice SA/DStv, while Eswatini TV continues to operate just like another government department. 

Perhaps the next development strategy should focus on cutting these painful dependencies and diversifying the economy to serve our national interests and secure trade partners that will help us grow than to suffocate the economy to its peril.

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