MBABANE (15 May 2025): Eswatini may issue another bond to be listed on the Johannesburg Stock Exchange next month to provide further budget support. “It won’t be a massive amount, it won’t be in the billions, but it will be in the hundreds of millions,” the minister of finance Neal Rijkenberg told the globally influential business publication, Bloomberg news.
The country listed a E400 million bond under a E4 billion programme on the bourse with a coupon of 11.875% in 2024.
Rijkenberg expects the terms of the issuance to be more favourable as Moody’s Ratings upgraded the its rating for the country bond programme on the JSE to investment grade. “This should also reduce the cost of our bonds and broaden the market,” the minister said in his budget speech in March.
The minister also told Bloomberg that legislation to create a sovereign wealth fund is expected to be approved within the next 3 months.
The minister said the fund would be created with E5 billion from a pool of government assets such as certain state owned companies, shares in banks and insurance companies and stakes in mines. The purpose of the fund is to build wealth for future generations and growing the economy.
“We are hoping the fund can be quite strategic in trying to crowd-in the private sector investments into manufacturing production, agro-processing, agriculture…. those kinds of industries.”
The minister told the publication that the government is also working on budget-support loans to clear arrears of about E2 billion and address the financial gap. Arrears to the private sector, especially the construction industry is one of the main frustrations of doing business with government.
The minister said they estimate a budget fiscal deficit of 3% of gross domestic product in the year which ended in March.
The government recently secured a loan of E100 million from the World Bank and is negotiating for a further $45 million from the African Development Bank and $50 million from the OPEC Fund for International Development.
Eswatini’s 2025 economic growth is forecast at 8.3% though this may be revised downwards following the introduction of tariffs on the United States of America market where Eswatini sells sugar, textiles and other products under the African Growth Opportunity Act (AGOA).
The minister of commerce Manqoba Khumalo indicated that Eswatini trade with the USA in the year 2023-2024 was worth $1.7 billion in which Eswatini exports to the USA were worth $384.32 million. Minister Khumalo told the ongoing investment conference in Mbabane that while Eswatini is part of the broader Southern Africa Custom’s Union negotiations to reduce tariffs to SACU, Eswatini is also conducting bilateral negotiations with the USA government that recognizes that the kingdom imports more from the USA than it exports to the that country.
In the tariff schedule announced by President Trump in April, the USA imposed 10% tariffs on Eswatini, one of the lowest in the world while tariffs to South Africa are rated at 30%.
The country’s economic growth rate is premised on a series of major development projects, such as the ongoing construction of the Five Star Hotel and International Convention Centre (FISH&ICC) at Ezulwini.
The anchor of the national economic growth trajectory is ongoing multi-billion work to develop the Mpakeni Dam in Lavumisa. The dam and associated works to augment its water capacity involves harnessing water off the Mkhondvo River and building tunnels to bring the water to the Mpakeni dam and to convey the water to irrigate 30,000 hectares of lowveld land for food production and cash crops. At completion in 2028, the project will benefit over 100,000 people and inspire a flush of new economic development enterprises.
Jm/today/15.5.2025
