Mbabane- Food manufacturers in Eswatini are facing pressure on their operating margins as the cost of producing essential food products rises, while regulations governing the prices of finished goods limit their ability to pass on higher costs to consumers.
The concern emerged during discussions between Business Eswatini (BE) and food manufacturing company Premier Eswatini, where the two parties examined the impact of administered prices on key production inputs, including fuel, electricity and wheat, as well as the regulation of bread prices.
According to Business Eswatini, the combined effect of these measures is placing pressure on manufacturers, particularly when increases in production costs cannot be adequately reflected in the prices of finished products.
The issue raises questions about the sustainability of food manufacturing operations, which depend on a balance between the cost of raw materials, energy and other inputs and the prices businesses can charge for their products.
The discussions highlighted the need for policymakers to consider how decisions made under different regulatory frameworks affect businesses across the food value chain.
While price controls may serve specific policy objectives, including protecting consumers from unaffordable essential goods, the business federation argued that their combined impact on manufacturers also needs to be considered.
The discussions come amid wider concerns about strengthening domestic food production and improving food security, with the viability of food processors and manufacturers closely linked to the availability and affordability of agricultural inputs.
BE also raised concerns about local procurement requirements, noting that although supporting domestic producers remains an important national objective, manufacturers need reliable supplies of raw materials that meet required quality standards and are available at competitive prices.
The federation said a balance was needed between promoting local production and ensuring that manufacturers could obtain the inputs required to sustain their operations.
The engagement also brought food security and agricultural productivity into focus, including Eswatini’s approach to genetically modified organisms (GMOs). BE called for an open discussion informed by scientific and economic evidence, involving policymakers, farmers, processors, researchers, regulators and consumers.
The organization said the country’s policy and regulatory framework should be examined to determine whether it adequately supports domestic food production, reduces vulnerability to external supply disruptions and improves the affordability of essential food products.
Beyond production costs, the meeting also addressed proposed changes to immigration and employment legislation, with BE highlighting the need for clear enforcement procedures and consultation with businesses where new requirements could affect investment, employment and business continuity.
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