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7.9% ECONOMIC GROWTH FOR ESWATINI

02/09/2022 08:56:00 Stanley Khumalo

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MANZINI – The economy of the country is bolting towards recovery as it grew by 7.9 per cent in 2021, says the Central Statistical Office (CSO).

The growth of the economy is calculated through the gross domestic product (GDP), which is a measure of the size and health of an economy. According to the bank of England, it is the total value of goods and services produced over a specific time period. The report by the CSO stated that the GDP for the year 2021 stood at E70.123 billion. It stated that this was a growth of 7.9 per cent compared to a decline of 1.6 per cent realised in 2020. In fact, when comparing the growth of the economy in the country since 2011, it is the highest in a decade. A growth of the economy recorded above 2.7 per cent was in 2012 wherein it expanded by 5.4 per cent while in 2013 it was 3.9 per cent. The other years leading to 2019 were recorded on average of two per cent.

It is worth noting that trade was severely compromised in 2020 following the advent of the coronavirus pandemic which resulted in constant restrictions to travel. Subsequent to these restrictions, the economy was open as movement of goods and people was permitted. Due to this, the CSO reported that in 2021 growth was recorded in the secondary sector which grew by 15.4 per cent while the tertiary sector expanded by 4.1 per cent.
Manufacturing, according to the report, contributed the largest share to the growth of the economy at 26.7 per cent. This industry is under the primary sector which consists of electricity supply, water and sewage, water collection and construction. The second best performer in the economy was the wholesale and retail industry which recorded 14.4 per cent growth, which was 0.01 per cent higher than the expansion recorded in 2020. Also, agriculture and forestry recorded a growth of 8.1 per cent which was the same rate of growth recorded in 2020.

On the other hand, public administration and defence recorded eight per cent in the past year, which was a decline from the 10 per cent growth achieved in 2020. The least contributing industries were mining and quarrying, with 0.2 per cent last year, while it had achieved the same growth even in 2020. Arts, entertainment and recreation also recorded a 0.1 per cent in growth as there were constant restrictions in the industry due to the COVID-19 pandemic which rendered the industry dormant. In light of this, the Minister of Commerce, Industry and Trade, Manqoba Khumalo said there was definite growth in the private sector. He said they had seen growth and reinvestment in existing firms.

“Some of the firms have secured new markets, particularly during the COVID-19 period. Secondly, we have a few new companies that have set up or are setting up as we speak and this has expanded the economy in the manufacturing sector,” he explained. Khumalo said the retail industry was also growing in leaps and bounds and as more emaSwati chose to buy goods locally against internationally, it had helped the economy. The minister said this was evidenced by the fast growth of retail malls and outlets that had been seen in the last two years. He said the growth symbolised that consumer spending had increased significantly.

Highest

The minister said this when he was sought for comment on what could have attributed to the highest growth of the GDP in a decade; more so because in 2020 the country recorded a -1.6 per cent growth. He was also asked what policies could the nation anticipate from the ministry to ensure that growth continued in order to ensure that the country did not lose this momentum and his ministry’s overall target as it was responsible for luring the business community into the kingdom. Khumalo said: “I do not believe we will lose this momentum. Actually, the pipeline of projects in the economic recovery plan is still very strong, and many private sector players are delivering on their commitments. The mining sector will be a very significant engine of growth in the next two years, and will hopefully match the manufacturing industry soon.”

Also, he said the Mkhondvo - Ngwavuma Water Augmentation Project would unleash sustained economic activities in the next five years. This, he said, would see Eswatini having a more balanced economy. The minister said the overall objective was to continue driving a private sector-led and export driven economy. He said as long as that was done, the country would record GDP growth in the region of 5 -10 per cent each year consistently.
This result, Khumalo said, showed that Eswatini remained a preferred investment destination for both growth and new investment projects. He said: “I’m very happy about this result, but it is a result of our strategic road map and supported by the post COVID-19 Recovery Plan.”

On the other hand, Chief Executive Officer at Business Eswatini Nathi Dlamini said: “If the GDP figure you’ve quoted me is accurate, I’m very elated.” He said it was good news to everyone who called this country home. Dlamini said despite being pummeled from all directions, the Eswatini economy seemed to be more resilient than it had always been given credit for. “Thanks to the business community and its workers who keep on pushing the envelope despite the odds. I wouldn’t leave out government, especially the Ministries of Commerce and Finance, for the role they have been, and are, playing to make things happen,” Dlamini said.