Mbabane: Last year wood pulp exports recorded E0.00, says Central Bank of Swaziland (CBS) Executive Assistant to the Governor Bhadala Mamba. He said in 2009, the exports recorded E40 million. Mamba said the closure of Sappi Usuthu contributed to this drastic decline.
He said though the exports declined when Sappi closed, the country realised a couple activities in the timber sector. However, these days forest fires were greatly affecting the sector.
Mamba was speaking during an economic conference organised by the Coordinating Assembly of Non Governmental Organisations (CANGO), in partnership with the Open Society of Southern Africa (OSISA) held at the Convention Centre yesterday. The conference is to assist the country's civil society craft an economic roadmap that will be used as an advocacy tool for government.
The organisers noted with great concern that the economic crisis faced by Swaziland was very serious and not a passing phase, which caused the country to plunge into an unprecedented economic crisis in 2011 due to the 60% decline in the Southern Africa Customs Union (SACU) revenue.
He said despite the 2008 world economic crisis, exports in the country have been stable. Mamba said as a result the overall exports rose to E17 billion.
"Other exports include ethanol, handcraft, fridges from Palfridge, pressure pumps by Peterstow at Ngwenya. Worth noting is that jam exports to the United Kingdom (UK), Canada and Holland also increased. If government supports them, we will see so much growth," he said.
Mamba said the country's economy was projected to grow at 1.3% in 2011 from 2.0% in 2010. He said the coming in of the sugar cane at the Lower Usuthu Smallholder Irrigation Project (LUSIP) and Komati Downstream also contributed to the growth. The executive assistant said companies like Conco, DD Williamson and Kraft Foods have been performing well. He said Conco was also anticipating expanding its operations as it was scaling down operations in some parts of Africa.
Mamba said the country's manufacturing was very profound in the economy, it continued performing well and was also influenced by companies Conco and DD Williamson. "We have seen an improvement in the agriculture sector, sugar production, maize, cotton and raw milk production. The retail sector is also improving as a number of malls are being established around the country. This sector is growing at a small rate but is creating small level of jobs," he said.
SD far from implementing FAR
Despite having been developed in 2010, Swaziland is far from implementing the Fiscal Adjustment Roadmap (FAR), says Independent Economist Dumsani Sithole. He said since 2010, there has been no fiscal sustainability in the medium term by controlling expenditure and enhancing revenue. Sithole said the country had weaknesses in domestic revenue administration.
"There is also lack of appropriate reforms to accelerate economic growth. Swaziland, amongst the sub-Saharan countries, has a very long and unsustainable wage bill," he said.
He said there were only three known revenue streams in Swaziland namely; the SACU, direct and indirect tax collected from individuals and companies and the accumulation of external and domestic debt. Sithole said SACU was a major contributor to the country's revenue while the others were not growing so significantly. He said none of them has increased above 25% as their growth was around 20%.
Sithole said the other sources combined failed to yield anything more than 50% of the national budget. "The sources are predominantly based on direct and indirect tax. The target is anyone or any company that receives or makes a profit. The value added tax (VAT) in particular focuses on importers of goods and services. On the indirect tax like VAT, this reduces disposable income of vulnerable particularly the poor," he said.