Mbabane: The European Union (EU) has predicted that next year, the country’s Southern African Customs Union (SACU) receipts might be significantly less than this year. EU Delegation to Swaziland’s Head of Operations, Raniero Leto said this year the receipts would reach E7.1 billion, far above their usual levels.
“While this SACU windfal is a welcome relief, we should not lose sight of the fact that receipts for the next year may well be significantly less. Over reliance on SACU may again pitch Swaziland into fiscal crisis. This is why government introduced value added tax (VAT) in April of this year,” he said during a first opening of a three-day workshop by the Common Market for East and Southern Africa (COMESA).
The event was themed ‘Improving the business climate in Swaziland.’ It was staged in partnership with the Swaziland Investment Promotions Authority (SIPA) at the Convention Centre. Leto said there was more Swaziland could learn from Mauritius, South Africa, Botswana and others, and that the workshop would afford Swazis the platform to learn from its neigbouring countries and improve.
He said more than 60% of Swaziland’s annual governemnt revenue came from SACU receipts. Leto said while there was no denying of the importance of SACU to Swaziland, it has proved a rather unpredictable friend. He said last year receipts fell to E2.9 billion and government had to work extremely hard to ensure that it could pay wages each month. “To its credit it managed,” he said.
Leto said also, Minister of Finance Majozi Sithole stressed the need for Swaziland’s economy to grow by at least 5% each year in order to reduce poverty in the country. He said over the last decade it had average about half of that.
“In my opinion the only way to achieve this 5% growth is through development of the private sector. This is why creating an enabling environment and increasing Swaziland’s competitiveness is so crucial for Swaziland. Remember that we are attempting to do so at a time of global economic turmoil, especially in Europe,” he said.
Leto said the event came at a time when the country had just launched the ambitious Investor Road Map. He said while government was commended for its launch, it should not be forgotten that the audit of the original investor road map was launched in 2005. Leto said only 19% of the proposed measures has been fully implemented and on 25% no progress had been made. He said there would be a need to fully understand why that was the case and how this time it would be different.
Full implementation of investor road map can take SD far
If Swaziland can fully implement all the stipulations of the newly launched investor road map it can approach fast to its neigbours and might overtake them, says EU Delegation to Swaziland’s Head of Operations, Raniero Leto.
“I sincerely hope that if we work diligently and implement what the various road maps state, then in few years’ time when the Mauritiuses, the South Africans, the Batswanas will look in their review mirrors and see Swaziland approaching fast and looking to overtake them,” he said.
He said there would be a need also to fully appreciate Swaziland’s comparative advantages, which were many, its weaknesses and the factors that would make the country different to the Mauritiuses, the South Africans, the Batswanas such as its governance system. Leto said if these issues would not be accomodated openly and honestly, a majority of the recommendations of the investor road map might again remain unimplemented.
SD’s economy grows slowly than its SACU partners
AS Swaziland continues to grow slower than its Southern African Customs Union (SACU) partners, its economy is likely to be marginalised.
President of the Zimbabwe Business Council David Govere made this observation during a seminar on improving the business climate in Swaziland. He said as compared to other countries like South Africa, Botswana, Swaziland was trading softer behind while the other partner’s were developing rapidly. Govere said this posed a very big challenge to Swaziland, as the country was keen on growing. He said very soon the overgrowth mode must apply so as to resuscitate the already ailing economy.
However, Govere was quick to state that the country boasts a number of comparative advantages which would come in handy. “What is needed is to gather courage and there is no better way to start than with the courage. Do the right thing and Swaziland will rise above its SACU partners. It’s very possible to achieve positive change,” he said. He said the creation and adoption of the country’s investor road map was critical for Swaziland’s economic development.
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