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PUBLIC DEBT SOARS TO E13.8 BILLION

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MBABANE – Preliminary figures indicate that total public debt stood at E13.8 billion, an equivalent of 22.3 per cent of GDP at the end of October 2018.


The Central Bank of Eswatini (CBE) reported that this reflected an increase of 1.5 per cent from the revised figure of E13.6 billion recorded in September 2018.


At the end of October 2018, external debt stood at E5.6 billion, an equivalent of 9.0 per cent of GDP.
“This shows that external debt increased by 1.8 per cent over the past month. The increase is mainly a result of a depreciation of the Lilangeni against the US Dollar and other major currencies in which the countries liabilities are denominated,” said CBE.


Equivalent


Domestic debt stood at about E8.2 billion at the end of October 2018, equivalent to 13.3 per cent of GDP.
Domestic debt increased by 0.5 per cent when compared to September 2018. The marginal increase was a result of increased uptake of the 91 Days Treasury Bills, as the Auction Committee applied the ‘green-shoe option’ which allows allotment of up-to 50 per cent over and above the amount on offer.


The bank also reported that the Plain Vanilla Bond accounts for over 50 per cent of the total domestic debt instruments issued. This instrument is mainly used for financing general government operations. Treasury Bills, which are used for similar purpose, amount to 30 per cent, whilst the Suppliers’ and Infrastructure Bonds account for 9 per cent and 6.8 per cent, respectively.
 The remainder is made up of Promissory Notes, which have been offered to specific suppliers to government.


Securities


CBE said while commercial banks continued to dominate participation in government securities on the shorter end of the yield curve, non-bank financial institutions dominate on the longer term securities.


Latest trade data indicated that as at September 2018, Eswatini recorded a merchandise trade deficit of E127.3 million from a surplus of E16.8 million in the previous month. Exports contracted by 7.8 per cent month-on-month to E2.119 billion, while imports narrowed by 1.6 per cent to E2.246 billion. Cumulative year-to-date balance in the merchandise trade amounted to a deficit of E1.374 billion in September 2018.


Miscellaneous edibles continue to be the leading export commodity followed by sugar. Export proceeds from miscellaneous edibles decreased to E821.8 million in September 2018, a 15 per cent month-on-month slump from the previous month.

On the contrary, receipts from the exports of sugar and sugar confectionary surged by a nine per cent month-on-month to E625.3 million during the review month. Textiles and articles of textiles posted a 29 per cent month-on-month drop to E144.6 million in September. These products were mainly destined to China, South Africa, Taiwan, United Kingdom and the US.


Depicting


During the same period, export proceeds from wood and wood articles amounted to E112.5 million, depicting a month-on-month decline of 1.5 per cent from August 2018.
Data shows that all wood and wood products exports are destined to the South African market.


“On the import side, the main commodities that were imported include cereals, mineral fuels, vehicles other than railway equipment, nuclear reactors, electrical machinery and equipment, iron and steel, cotton, plastic and plastic products, electricity, and essential oils. All these products accounted for 61 per cent of the total import bill for September 2018,” added CBE.

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