MBABANE – Eswatini’s rising public debt is pushing the economy into a danger zone, warns Dr George Choongwa, Regional Coordinator at SARFED, calling for urgent fiscal discipline.
The Coordinator at the Southern African Research Foundation for Economic Development (SARFED), Dr Choongwa, has warned that Eswatini’s rising public debt is pushing the economy into a danger zone that could compromise long-term growth, stability and social progress.
Responding to Finance Minister Neal Rijkenberg’s defence of the nation’s E38 billion debt earlier this month, Dr Choongwa said that although Eswatini’s debt-to-GDP ratio of 40.2 per cent remains within the 41 per cent benchmark, the country has little room left to manoeuvre.
“Eswatini is effectively operating with less than a 2 per cent debt-free margin, which is a high-risk position in an unpredictable global environment,” Dr Choongwa said.
According to the Ministry of Finance’s 2024/25 Annual Performance Report, the country’s external debt stands at about 40.2 per cent of GDP. While technically below the safety threshold, Dr Choongwa cautioned that international experience shows debt levels in the 40–50 per cent range are widely considered a red flag.
He further pointed out that Eswatini is grappling with vulnerabilities ranging from global geopolitical tensions such as the Russia-Ukraine war, to domestic challenges like climate shocks and high poverty levels, currently estimated at 53 per cent.
Despite this, Eswatini continues to attract foreign investment in mining, infrastructure and technology — a trend that Dr Choongwa said could be undermined if debt reliance deepens.
Dr Choongwa emphasised that Eswatini’s public finance policy must become more forward-looking rather than reactive if it is to shield the economy from widening fiscal risks.
“Short-term fiscal fixes may keep the numbers in line, but they do not provide the stability that long-term investors are looking for,” he cautioned.
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