- Minister of Finance Neal Rijkenberg says Eswatini is overhauling its governance structures
- The Kingdom of Eswatini has spent two years tightening its belt to create fiscal space
- One of the ways we are tackling economic growth is through a private sector-led economy
Mbabane: Minister of Finance Neal Rijkenberg says Eswatini is overhauling its governance structures to allow a private sector-led recovery from the Covid-19 pandemic – and to ensure sustainability.
The Minister shared his opinion on the South African new site, the Business Insider on March 25, 2021. The Kingdom of Eswatini has spent two years tightening its belt to create fiscal space by reducing both overspending and its stock of arrears — and it’s working. The country is slowly improving the fundamentals of its economy. However, there’s still a long way to go.
Rijkenberg said Eswatini entered the Covid-19 pandemic with an already deteriorating macro-fiscal position of sluggish growth and waning institutional strength. Since then, the widespread effects of the pandemic have significantly and permanently altered the national trajectory.
He said, however, Eswatini is focused on growing out of this situation by ensuring that the government is as effective as possible — doing as much as possible with minimal resources.
He said Eswatini has been on a mission to change the fabric of its economy. At the heart of that has been reforming regulations and processes for efficient spending, limiting waste, rooting out corruption, overhauling the country’s tax system and ensuring effective service delivery.
“One of the ways we are tackling economic growth is through a private sector-led economy. We believe the private sector will be successful in taking the reins as a key employer, while the government re-establishes itself as the key enabler of growth across all sectors of the economy,” the minister said.
He added that naturally, we cannot talk about economic growth without addressing the ease of doing business. He said the aim of the government is to create a conducive environment for the establishment of businesses.
“By reducing red tape and other barriers, we aim to unlock development projects with high returns on investment,”
He said the government was in the process of establishing an electronic “one-stop-shop”, which will offer a number of services, including company registration, trading licences, issuance of work permits, health inspections, labour compliance, and registration for utilities, including electricity, water, and telecommunications.
Evidence indicates a high correlation between countries that have made significant ease-of-doing-business improvements and the establishment of a centralised one-stop-shop facility.
He said another goal of the government was to shorten the timeframe for opening a business in Eswatini, among other factors, to unlock further economic growth.
Already, the country was seeing some exciting new developments in the private sector. For example, Kellogg’s opened a factory in Eswatini that has already created 250 jobs. It is through further reducing barriers to entry that companies such as Kellogg’s will invest in Eswatini.
“We are also proud to see that our SMMEs have taken the initiative in diversifying their operations and retooling their factories to produce export-quality personal protective equipment and sanitizers,” Rijkenberg said.
Innovation and adaptation
He revealed that other businesses in Eswatini are preparing to occupy the latest factory shells in urban and rural areas alike. These factory shells are designed to be occupied by businesses around the country so they can employ thousands of Emaswati each year.
He said the only challenge with the model was that it led to a high pattern of migration, with workers moving systematically from one region to another for work.
This began to undermine social structures as many families became separated.
To devolve economic activities and create jobs where people live, the government have decided to construct factory shells at the level of the Tinkhundla (the local administrative unit) and also to expand the women-led textile industries.
The finance minister said despite the challenges caused by the pandemic and lockdowns, a number of projects (similar to those mentioned above) are now at an advanced stage, and the nation will continue to see the implementation of this job-focused plan in the course of the year.
Eswatini has worked very hard to fix the holes in its bucket, and we are beginning to see the results of our labour. The country remains confident that its economy is gearing up to be on a sustainable path.