LOBAMBA – Prime Minister Russell Mmiso Dlamini says local construction companies have the capacity to undertake major infrastructure projects.
The prime minister said several local companies had successfully delivered large-scale projects, proving they had the expertise to compete. Dlamini said this during the Portfolio Committee debate on the prime minister’s Office First Quarter Performance Report for the 2026/27 financial year on Thursday.
Responding to concerns over government contracts awarded to foreign companies, Dlamini said Cabinet had agreed that local companies should be prioritised where they had capacity.
“The issue of foreign companies being awarded work locally is one that we have also discussed at Cabinet. It is a real concern because when we award contracts to foreign companies, it is as though we are exporting money and jobs that should be stimulating our own economy. That money should be circulating within the country,” he said.
The prime minister said Cabinet had resolved that foreign companies should only be awarded contracts where the required expertise or specialised skills were not available locally. “Foreign companies must only undertake work where we do not have the necessary skills. For major projects, we have seen excellent work being done by local companies,” he said.
Dlamini cited the Gege-Sicunusa Road as an example of work local contractors could deliver. “I always use the Gege Road as an example. The road is beautiful. We cannot continue saying Eswatini does not have capable construction companies. There are others, such as AG Thomas, which are among the big and capable companies in the country,” he said.
The Gege-Sicunusa Road was commissioned by His Majesty King Mswati III in October 2024. The 42.5-kilometre road was built by Inyatsi Construction. The E647 million project links Mahamba, Gege and Sicunusa, and was hailed by the King as a pivotal development for the region and the country.
During the official opening, His Majesty the King acknowledged the role played by Inyatsi Group in delivering the project.
Meanwhile, during the Portfolio Committee debate, the prime minister said Cabinet had agreed on a procurement policy after waiting for more than two years. “There is a procurement policy that we have received. As Cabinet, we have been calling for it for the past two and a half years. All the necessary procedures must still be followed, and the legislation must come through the Ministry of Finance. However, at least we have now agreed on a procurement policy,” he said.
Dlamini also acknowledged weaknesses in the country’s contract negotiation processes, particularly in engagements with development partners and funders. “There are also challenges relating to poor negotiations. Those who negotiate with our funders must be properly skilled. We have to address that in our procurement law, and I hope those provisions will be introduced soon,” he said.
Thursday was not the first time the prime minister spoke strongly about local participation in major projects. At the beginning of this month, he was quoted as saying Cabinet had discussed how government projects could maximise benefits for local businesses and communities.
He was speaking during the launch of Phase I of the Eswatini Road Infrastructure Improvement Programme at Sithobela Inkhundla. The roads will be constructed by Stefanutti Stocks and WBHO, both foreign-owned companies, together with local company AG Thomas. “We want these works to be done by emaSwati contractors so that the money stays in Eswatini and continues circulating within our economy,” he said.
The pm said the decision formed part of government’s broader strategy to stimulate economic activity and achieve double-digit economic growth through increased local participation in infrastructure development.
Last month, our sister publication reported that the prime minister had reiterated the need for the construction of the Strategic Oil Reserve Facility to deliver meaningful economic benefits for emaSwati. He said achieving the targeted 30 per cent local participation remained a key priority. He said this during a site tour of the facility at Phuzumoya, Siphofaneni.
The pm said while the project would strengthen Eswatini’s energy security once completed, government was also focused on ensuring that local contractors, suppliers, service providers and workers benefited during construction.
He said major infrastructure projects should not only deliver physical assets, but also stimulate economic activity by creating opportunities for local businesses and building the capacity of the country’s workforce. “I, therefore, wish to reiterate the importance of achieving the targeted 30 per cent local participation on this project. This will not only create immediate opportunities, but will also contribute towards building the capacity of local companies and developing skills that will enable emaSwati to participate in future infrastructure projects, both locally and beyond our borders,” he said.
The pm said government would continue to monitor progress towards the local participation target through the appropriate reporting mechanisms.
During the same tour, Prince Lonkhokhela, the Minister for Natural Resources and Energy, also raised concerns about local participation in the Strategic Oil Reserve Facility project.
Towards the end of the tour, the minister demanded answers from Project Manager Haness Kleymhaus. The concerns came amid calls for meaningful local participation in major construction projects, with foreign companies continuing to secure a significant share of work on large-scale public infrastructure developments.
The Strategic Oil Reserve Facility became the latest project of debate following reports that certain elements of the works had been subcontracted to WBHO Construction. The reason, it was gathered, was allegedly that local companies lacked capacity.
Although WBHO is a South African construction company, the work is being undertaken through its local branch, which was appointed by the project’s main contractor.
Our sister publication reported that although the company employed a considerable number of emaSwati at the site, concerns had emerged that several services which could have benefited local businesses had instead been awarded to foreign companies.
Meanwhile, according to figures compiled by procurement watchdogs, infrastructure and development projects currently under way or recently awarded are estimated at about E18.4 billion, with most allocated to foreign-owned companies. Industry stakeholders said this appeared inconsistent with government’s broader objective of building local capacity and promoting citizen-owned enterprises.
Unlike many infrastructure projects awarded to foreign contractors, the Strategic Oil Reserve Facility agreement contains a provision requiring at least 30 per cent of the project to be subcontracted to local suppliers and service providers.
The agreement further requires project partners to empower emaSwati through employment opportunities and collaboration with local businesses, making it one of the few major infrastructure projects with an explicit localisation target. In monetary terms, 30 per cent of the E5.2 billion project translates to about E1.56 billion in opportunities for local companies.
