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INSTITUTIONAL COOPERATION VITAL IN PRIVATE SECTOR

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MBABANE - Institutional cooperation is vital to Eswatini and the business sector, as it would help the country avoid the economic fragility trap.

This was mentioned by Dr George H. Choongwa, Southern African Research Foundation for Economic Development (SARFED) Regional Coordinator. Choongwa said fragility in all its forms in Eswatini would pose a formidable obstacle to eradicating extreme poverty and promoting sustainable development for the country beyond Agenda 2030. Therefore, the country’s competitiveness would heavily depend on success in building resilient institutions and societies on reducing conflict and promoting institutional cooperation.

Impede

He said if left unaddressed, fragility would impede Eswatini’s post-2020 development goals towards the attainment of the Sustainable Development Goals of 2030, whose core focus were that of significantly reducing poverty levels for the betterment of the entire society. “Unless there is a collective effort from both Government of Eswatini and its stakeholders, mainly the non-State Actors focused on addressing fragility and building institutional capacity which would result in economic stability and reduction of conflict, nearly half of the country’s population would remain faced with income poverty in the next five years which is 2027,” he said. The economist said this was based on the understanding that if the country’s institutions develop and conflict declines faster, the general economic stability would have been achieved faster, hence meeting the country’s goals for national development.

strengthening

Choongwa also mentioned that Eswatini needs to focus on strengthening local public and private sector capacity on various cross cutting issues that affect national development, either directly or indirectly. He said this includes issues of public finance and governance, so as to address the country’s economic performance from being impaired by limited administrative capacity, persistent social tensions, ongoing conflict and political instability. “The country would suffer much financial or fiscal-related challenges if it is to slide into fragility, this is due to the understanding that post-COVID-19 crisis, the country has been faced with fiscal challenges as SACU recorded much challenge in export market which were hampered with restricted supply chain of sugar and other country’s export commodities,” he said.

He further outlined that the cost of economic fragility might be too high for an average liSwati to pay should the country slide into that zone. Lessons can be learnt from other African states that have been left behind with high levels of poverty by the global economic transformation process towards 2030. Choongwa said the fragility trap has high possibility to bring about conflict trap and higher levels of poverty as government would fail to provide basic necessities to the general public. This would work against the country’s notable positive trends in reducing its poverty levels.

He attested that the degree of economic vulnerability the country might find itself might result in what can be termed as economic exclusion and instability. This was as a result of noticeable high structural challenges which might result into poor public service delivery. “In this regard, stakeholders together with the various public institutions should constantly revise their performance strategies so as to achieve the country’s sustainable development agenda,” he said.  

Challenge

He added that one other challenge that Eswatini might face due to ongoing tensions was that of experiencing negative regional spillover effect, which could not on cripple the two neighbouring countries namely South Africa and Mozambique, but the entire COMESA - EAC - SADC Tripartite agenda for regional integration. He said  Eswatini fared well in the previous bid for promoting intra-regional trade as His Majesty King Mswati III launched the African Electronic Trade Group (AeTrade) Regional Headquarters for Southern Africa in Eswatini on October 4, 2019. This initiative was aimed at creating about 600 000 SME (Small and Medium-Sized Enterprises) jobs which would in turn create 22 million jobs across Africa. About 4 000 emaSwati were likely to be employed in various fields such as technology, trade, legal and finance during the initial stage of implementation.

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