By Delisa Thwala
The Covd-19 pandemic battered all sectors of the economy and saw job losses as some companies were forced to fold.
Realising the impact of the pandemic and the need to stimulate the economy and create jobs, His Majesty King Mswati III’s government stepped in and spearheaded at least 10 projects that cost E12 billion and rejuvenated several industries.
The bigger manufacturing and processing industries were somewhat insulated and managed to survive and respond to the economic challenges than smaller businesses.
The world over saw thousands of staff retrenchments, with about 14% of overall staff laid off following the resumption of activities. The government’s Post-Covid-19 Economic Recovery Plan has yielded some positive results as detailed in a report compiled by the Eswatini Economic Policy Analysis and Research Centre (ESEPARC).
According to the report, the investment in the economy came from agriculture, energy, infrastructure, ICT, Manufacturing, retail, textile, tourism, mining, and aviation.
One of the sectors with the highest investment was agriculture at E2.8 billion, translating to a total of 3,700 jobs created. Investments in this sector were by the Royal Eswatini Sugar Corporation (RES) and the LUSIP 2 project.
The energy sector led to the creation of 615 jobs, and a total investment of E1 billion. Investments comprised Mitra Energy, an energy company that has committed to opening 10 service stations, mostly in rural areas.
The Eswatini Electricity Company also invested a total of E560 million in their Network Reinforcement project. The Lavumisa Solar Project on the other hand contributed a total of E400 million to the local economy.
In terms of infrastructure, health, and property, a total of E3 billion was invested in the local economy leading to a total of 2100 jobs created.
Infrastructure projects entailed the Manzini Mbhadlane Highway, the Manzini Interchange, and the Gege Sicunusa Road which created about 1000 jobs.
The Ezulwini Private Hospital’s Investment value was at E400 million with an estimated 110 jobs created.
The AHF Health Facility also had a E400 million investment value, and the FNB Headquarters had an investment value of E200 million. The ICT sector contributed E419 million to the country’s recovery according to the report. The ESCCOM Headquarters project is estimated to be worth E200 million.
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Manufacturing which is one of the sectors that has led to the country being considered one of the most industrial economies on the continent had an investment of E1, 5 billion.
Projects under manufacturing included the Lush Hair Care Factory, Umtfombo Wekuphila Health Care Factory, SANO Foods, Britannia Brands, Invert Syrup Plant, Nurscon Flexibles, and Mondelez Expansion, which was to the tune of E60 million.
The Kellog Tolaram Production Plant was to the tune of E150 million, and the SOMI expansion had an investment value of E450 million. Retail injected a total of E875 million into the local economy and comprised of projects such as Matsapha Link, Spar Hilltop, Ok Msunduza, Matsapha Lifestyle, Ngwenya Mall, Siteki Mall, Manzini Junction, Malkerns Square Retail, Cardo Square and Siphofaneni Pick n Pay.
Tourism, Mining, and Aviation had a combined investment of E950 million, with a total of 400 jobs. The report further states that the Government of Eswatini (GoE) recognizes that the Covid-19 pandemic is not just a health crisis but also an economic crisis.
Before Covid-19, the Kingdom of Eswatini was already experiencing key economic challenges and so the pandemic exacerbated an already fragile economic situation.
In the 2019-2022 Economic Outlook provided by the Ministry of Economic Planning and Development, growth in Eswatini declined from 2.4 per cent in 2018 to 1.3 per cent in 2019 due to a slowdown in economic activity in the primary and tertiary sectors of the economy.
Another key factor contributing to subdued economic growth in Eswatini is the Government’s large footprint as the key driver of the economy. As a result of many businesses/economic activities being dependent on the Government, the current fiscal challenges have constrained public expenditure and limited the ability of the economy to create employment and opportunities for growth.
While economic growth forecasts for 2020 had given prospects for economic recovery with a projection of more than 2 per cent growth, the global outbreak of Covid-19 has resulted in a downward revision of the growth projections so that in the next coming months, the Eswatini economy is expected to experience a significant contraction in economic activities.
Lots of opportunities in manufacturing – Minister Manqoba
Minister of Commerce, Industry and Trade Manqoba Khumalo has indicated that emaSwati are still not in the manufacturing space.
Khumalo has always preached and advocated for emaSwati to venture into the manufacturing space as there were a lot of opportunities.
He said this was, therefore, where the focus should be for the country because it was noted that most of the products available in the country were imported.
When previously speaking during the launch of the Entrepreneur of the Year Awards (EYA) 2024 last month, Khumalo said foreign companies who were running the manufacturing firms, especially in the textile firms, were making a lot of money that would have been made by emaSwati.
The minister challenged stakeholders like the Small Enterprises Development Company (SEDCO), to find ways to transform the local MSMEs into large manufacturers.
He noted that through manufacturing, a lot of people would be hired. Khumalo further highlighted that jobs were not created at the expected pace and at the rate at which the country was producing graduates and such was leading to untold frustration.
He said partly, it was because the country was still stuck in the past.
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Minister Khumalo said their role as the government was to create an enabling environment for local businesses to out-compete imports.
He said it was their duty to see how they could make protections for the local businesses.
He said one of the mitigations to that was the recently passed Citizens Economic Empowerment Act of 2023.
He stated that to see that Act functioning, they were currently busy with the composition of the Citizens Economic Empowerment Council, which would, among other things, prepare the regulations of this Act.
He added that in the wake of the African Continental Free Trade Area (AfCFTA), emaSwati entrepreneurs should think big and establish Eswatini as a production centre for the entire.
The minister encouraged MSMEs to seize the opportunities presented by larger markets, particularly those within the AfCFTA, which was now open for trade.
He said the AfCFTA was ground-breaking, as it has created a single continental market for goods and services, with free movement of businesspersons and investments.
Khumalo said by tapping into this expansive market, entrepreneurs could significantly increase their customer base, diversify their revenue streams, and reduce their dependence on local markets.
