In-Depth Analysis
eSwatini
Landlocked eSwatini is ruled by Africa’s last absolute monarch and most of its people are dependent on subsistence agriculture. Unwarranted state spending blemishes the country’s reputation, along with its foreign investment appeal. Key macroeconomic indicators have underperformed in recent years, mainly due to the widening fiscal deficit. While disruptive political change seems certain, it does not look imminent.
The fiscal budget for this year makes plain that the Covid-19 pandemic has accelerated an economic and fiscal deterioration that was already brewing in eSwatini. Although eSwatini has a particularly ambitious plan to consolidate its fiscal position, execution will prove difficult. With Southern African Customs Union receipts expected to decline over the medium term, and the government reluctant to increase taxes over the short term, spending will need to be strapped in. Fiscal consolidation will place a further cap on economic growth, which is already weak to begin with. Although we expect the economy to rebound in 2021, the outlook is uncertain and the risks high, with GDP growth expected to trend at low levels over the medium - to long term. (Source: eSwatini Quarterly Update, published September 2021)
Macroeconomic Data
(2020)
|
Fiscal Balance (as a % of GDP) |
-8.2 |
|
Consumer Price Index (% change y-o-y, avg) |
3.9 |
|
Current Account Balance (as a % of GDP) |
6.4 |
|
Real GDP (annual % change) |
-1.8 |
|
GDP per Capita, US$ |
3,419.8 |
|
Import Cover (months) |
3.86 |
|
Population, million |
1.2 |
| Total External Debt (as a % of GDP) |
20.3 |