MBABANE – More than five years after the launch of Eswatini’s Special Economic Zones (SEZs), the country is yet to see a single operational investment take root.
The prolonged dormancy of the SEZs has ignited concern across the political and economic spectrum, with stakeholders demanding a solution to unlock the zones’ full potential.
Eswatini currently has two designated SEZs;
- The Royal Science and Technology Park (RSTP), aimed at attracting biotechnology, high-tech manufacturing and research and development firms; and
- The King Mswati III International Airport (KMIII) Precinct, designated for aerospace industries, agro-processing, freight logistics and advanced manufacturing.
Despite this promising foundation, no company has begun operations in either zone.
In a stakeholder engagement session held yesterday, Minister for Commerce, Industry and Trade Manqoba Khumalo led critical discussions with Members of Parliament (MPs), regulators and SEZ developers, pushing for amendments to the Special Economic Zones Act of 2018 to address systemic roadblocks stalling investor participation.
Minister Khumalo outlined three major structural and procedural challenges currently hindering progress, along with a fourth challenge relating to the sustainability of fiscal incentives.
The minister stated that a major obstacle lies in the SEZ Act’s requirement that 80 per cent of goods produced in these zones be exported outside the Southern African Customs Union (SACU).
“This provision is out of step with economic realities,” said Khumalo. “Most investors are targeting the South African market, which is both geographically accessible and commercially viable. South Africa also happens to be Eswatini’s main trading partner. To insist that 80 per cent of output must bypass this market is simply discouraging investors.”
He emphasised the need to align the SEZ framework with Eswatini’s real-world trading environment and ensure that policies facilitate, rather than restrict, cross-border business.
Another pressing issue that Khumalo talked about is the bureaucratic licensing process that potential investors must navigate.
More details in today’s paper.
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