A New Public Finance Review Aims to Help Eswatini Improve Fiscal Policy for Better Development Outcomes
The World Bank and the Government of Eswatini launched a new review highlighting ways to make fiscal policy in Eswatini more efficient and effective. The Eswatini Public Finance Review (PFR): Leveraging Fiscal Adjustment for Better Development Outcomes, is the first review for Eswatini since 1996.
The review aims to support the country in enhancing the efficiency and effectiveness of public spending and revenue mobilization to drive sustainable and inclusive economic growth. It provides a comprehensive analysis of Eswatini's fiscal policy and its role in addressing constraints to economic growth and livelihoods. The review acknowledges Eswatini's strong post-pandemic recovery, which averaged 5.3% growth from 2021 to 2023, while underscoring the urgent need for reforms to achieve broad-based economic progress.
'The Government has made significant progress since 2019 in reducing the fiscal deficit and implementing fiscal adjustment measures. Notwithstanding, stepped-up efforts are needed to implement some of the critical reforms highlighted in the Public Finance Review' says Eswatini's Minister of Finance, Honorable Neal Rijkenberg.
The review highlights Eswatini's need for prudent fiscal management and identifies key pathways for achieving its development objectives. It emphasizes the need to make fiscal policy an instrument for macroeconomic stability and external competitiveness. Enhanced revenue mobilization through improved tax administration and streamlined procedures is crucial, along with strengthened public financial management for maximizing value-for-money. Improving public investment management while integrating climate considerations is essential to maximize the impact of public spending on economic growth and development, The review stresses the importance of directly tackling challenges in the health sector – a sector critical for human development and improving health outcomes.
Eswatini can enhance economic efficiency and social equity in several areas. First, it can work to contain expansionary fiscal policy, eliminating expenditure arrears, and addressing the wage premium between the public and private sectors to promote macroeconomic stability and external competitiveness. Second, it can make improvements in tax administration such as creating a specialized unit for high-net-worth individuals, streamlining procedures, and maximizing electronic tax filing to boost revenue by 1.6 to 3.3% of GDP. Third, public financial management could be strengthened by enhancing budget preparation, improving budget execution and commitment controls, reforming state-owned enterprises, and streamlining public procurement, especially by implementing electronic procurement solutions. In the health sector, addressing inefficiencies could be achieved through better expenditure management, improved supply chains, and enhanced healthcare access and quality, particularly in primary care.
'Eswatini's future hinges on its ability to leverage fiscal policy strategically. By implementing the reforms outlined in the Public Finance Review, Eswatini could create a more competitive and resilient economy, fostering inclusive growth and improving the lives of all Emaswati. The World Bank is committed to providing technical assistance and financial support in guiding the country towards fiscal sustainability and inclusive growth," says Satu Kahkonen, World Bank Country Director for Eswatini.
Distributed by APO Group on behalf of The World Bank Group.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The National
18 hours ago
- The National
'Trumped' again: Taking stock of Tesla's market ups and downs
Tesla Motors' stock price is taking a beating again, this time because of the very high-profile squabble between chief executive Elon Musk and US President Donald Trump. Its 15 per cent decline on Thursday reflects the volatility that shadows the company's shares, which remain vulnerable to everything from market trends to short tweets, especially from Mr Musk. Now, with his increasingly bitter fight with Mr Trump, Mr Musk might find himself on the short end of the stick: once a trusted adviser, he has now fallen out of favour with his blitz of criticism over Mr Trump's "big, beautiful" budget bill. Mr Musk derided it as a "disgusting abomination". His gripes won't surely sit well with a "very disappointed" Mr Trump, who is notorious for getting back at his critics. Mr Musk curried favours during his time in the US administration, securing contracts and deals for his companies. Those favours are now likely up in the air. Mr Trump had already suggested that one way to save "billions and billions" is to "terminate" Mr Musk's government subsidies and contracts. It's a spectacular U-turn for the once allies; Mr Trump said he even bought a Tesla to show his support for Mr Musk. Losing the White House's support would be "terrible for Tesla, which is being eaten alive in Europe and Asia by Chinese competition, and Elon Musk's irritating involvement in politics", said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank. She pointed out that Mr Musk would need the President's support, especially for Tesla's self-driving cars and Robotaxis, which "need friendly legislation to thrive". "Legislation is Trump. The hype around Tesla is not looking good," she added. Tesla's shares were up nearly 5 per cent in premarket trading on Friday amid reports of a scheduled call between Mr Trump and Mr Musk to end the spat. While Tesla's stock still remains slightly above its level when Mr Trump won his second presidency in November – Mr Musk splashed $250 million to help ensure that – it's now uncertain how the Musk-Trump clash will affect its share price moving forward. Here are some of the biggest movements in Tesla's stock history. July 24, 2024: Competition heat Tesla's stock dove 12 per cent to $215.99 after its second-quarter financials disappointed, with revenue sliding 7 per cent. The EV maker began feeling the heat from intense competition, most notably from China, as BYD famously overtook it as the world's biggest EV maker in the fourth quarter of 2023 and, subsequently, for the entirety of 2024. October 24, 2024: 22% blitz After solid third quarter financials that saw Mr Musk boldly projecting up to 30 per cent more sales in 2025, Tesla's stock rocketed nearly 22 per cent, putting investors at ease. This was the biggest single-day gain in more than a decade, which also added $150 billion to the company's market value. November 11, 2024: Tesla gets 'Trumped' Tesla gained nearly 9 per cent to $350 as investors expected the alliance between Mr Musk and the then president-elect Mr Trump to further boost its stock. The world's wealthiest person threw in about $250 million into Mr Trump's campaign to help the latter recapture the White House earlier that month. January 2, 2025: New Year's peeve After a series of highs, Tesla came back down, starting the new year with a more than 6 per cent drop to $379.28 after deliveries posted their first decline in a decade. This was also the first time the stock went below the $400 level in nearly a month. February 11, 2025: BYD strikes again After the previous coups, BYD once again hit Tesla, this time as it partnered with fellow Chinese company DeepSeek – famous for putting a dent into the auras of OpenAI and Nvidia – to utilise artificial intelligence in autonomous vehicles. That caused Tesla's stock to shed 6.3 per cent to $328.50. March 10 to April 9, 2025: Tariff see-saw The beginning of the Trump tariff effect: on March 10, Tesla's stock slid more than 15 per cent to $222.15, amid concerns and uncertainty around Mr Trump's planned tariffs. It didn't last long, as the company's share price worked its way back up, peaking – for this period – at $288.14 on March 25, as Mr Trump signalled he might scale back some of the levies. Mr Trump unveiled his Liberation Day tariffs on April 2. By April 8, investors were now raising concerns on how the company would cope with them: that combination pulled down Tesla's shares nearly 5 per cent to $221.86, its lowest since the March 10 slide. This time, it seemed like a blip: the following day, April 9, Tesla shares soared more than 22 per cent after Benchmark Company analyst Mickey Legg dismissed the sell-off as 'overblown'. April 21, 2025: Dogged by Doge Tesla shares gave up almost 6 per cent analyst fears that there was an 'continuing brand erosion' stemming from Mr Musk's role in the Trump administration. Mr Musk and Tesla had already been feeling the backlash: consumers and the general public, particularly those incensed by his federal job and budget cutting, have protested outside Tesla stores and vandalised its EVs, in addition to Tesla owners "rebranding" their cars out of protest. May 14, 2025: Tariff reprieve Tesla gained more than 9 per cent to $347.68 from the close on May 12 – the day the US and China agreed to temporarily halt their tit-for-tat tariffs. The company's stock would then remain largely steady, until Mr Musk departed from his role in the US government – leading to the public squabble with Mr Trump.
Arabian Post
a day ago
- Arabian Post
Middle East Debt Surges as External Influence Deepens
The debt burden across the Middle East and North Africa has escalated markedly over the last decade, with many governments relying heavily on borrowing to sustain public spending amid economic challenges. This growing fiscal strain, combined with an increasing dependence on external donor funding, has amplified the influence of foreign actors on both domestic policies and regional geopolitics, raising concerns about the long-term economic sovereignty of these states. State borrowing in the MENA region has expanded substantially due to a combination of declining oil revenues, rising public expenditures, and the economic fallout from global disruptions. Countries that historically relied on hydrocarbon wealth to finance budgets have faced persistent pressures to diversify revenue sources, but with uneven success. The persistence of conflict, political instability, and the lingering impacts of the COVID-19 pandemic have exacerbated fiscal deficits, pushing governments to turn to international lenders and multilateral institutions more frequently. The Gulf Cooperation Council members, traditionally seen as relatively debt-resilient, have witnessed a gradual uptick in sovereign borrowing. For instance, Saudi Arabia and the United Arab Emirates have issued substantial sovereign bonds in international markets to fund large infrastructure projects under their economic diversification agendas. Nonetheless, their debt-to-GDP ratios remain relatively contained compared to other MENA nations. Meanwhile, countries like Egypt, Jordan, and Lebanon have accumulated debt at levels that alarm economists and credit rating agencies. Egypt's public debt has exceeded 90% of GDP, while Lebanon remains mired in a sovereign debt crisis, with its economy contracting sharply and international lenders demanding stringent reforms. ADVERTISEMENT The rise in borrowing often comes with conditions attached by international creditors, including the International Monetary Fund and World Bank, as well as bilateral donors such as the European Union, the United States, and Gulf allies. These conditions frequently mandate structural reforms, austerity measures, and adjustments in subsidy programmes that affect large segments of the population. Such fiscal tightening has stirred public discontent and occasionally sparked protests, underscoring the delicate balance governments must strike between fiscal responsibility and social stability. The reliance on donor funding has widened the scope for foreign influence in national decision-making. Some nations find themselves aligning their foreign policies to appease key donors, ensuring continued financial assistance. This alignment manifests in diplomatic stances, regional alliances, and participation in international coalitions, sometimes at odds with local priorities or public opinion. For example, the strategic partnerships between Gulf states and Western powers have intensified, with financial aid often linked to military cooperation or counterterrorism initiatives. Beyond geopolitics, the conditionality of donor funding can limit the policy options available to governments, constraining economic strategies and reform agendas. This external pressure has raised questions about sovereignty and the capacity of states to chart independent development paths. Economists warn that a cycle of debt dependence could undermine the very economic growth that these countries seek, trapping them in a cycle of borrowing and reform fatigue. The structural challenges that fuel debt accumulation in MENA are multifaceted. Demographic pressures, with a large youth population entering the job market, heighten the demand for public services and employment opportunities. However, the private sector remains underdeveloped in many countries, unable to absorb the expanding labour force or generate sufficient revenue to alleviate public finances. High unemployment rates and income disparities compound the strain on state budgets, forcing governments to maintain subsidies on essentials such as fuel, electricity, and food, which constitute significant fiscal burdens. Energy transition trends and volatile global markets further complicate the fiscal landscape. The drive towards renewable energy and reduced reliance on fossil fuels threatens to erode the traditional income bases of hydrocarbon-exporting countries. While some Gulf states have embraced ambitious clean energy projects and economic diversification, the transition carries upfront costs that add to borrowing needs. Non-GCC nations that rely on oil and gas revenues for budgetary support face more acute vulnerabilities, with fluctuating commodity prices directly impacting their fiscal stability. ADVERTISEMENT Policy experts advocate for enhanced fiscal reforms focused on broadening the tax base, improving public financial management, and fostering private sector growth. Greater regional cooperation on debt restructuring and coordinated economic policies could also alleviate pressures. Yet, political instability and entrenched governance challenges hamper implementation efforts in several countries. Transparency and accountability deficits remain a significant obstacle to efficient debt management and the effective use of external funds. International financial institutions have called for a balanced approach to lending and aid, one that supports immediate fiscal needs while promoting sustainable development. This includes encouraging greater domestic resource mobilisation and reducing reliance on donor funding in the medium term. Failure to address these issues risks escalating debt distress and diminished policy autonomy, with potentially destabilising repercussions for the entire region.
Arabian Post
a day ago
- Arabian Post
Unregulated Gold Rush Poses Existential Risk to Ghana's Mining Future
Ghana's gold reserves have surged to 31.37 tonnes in 2025, reaffirming its position as Africa's leading gold producer. However, this growth is shadowed by a significant rise in artisanal and small-scale mining , which now accounts for nearly 40% of national output. The proliferation of unlicensed operations is raising alarms over environmental degradation, regulatory challenges, and the long-term sustainability of the country's mining sector. The Ghana Chamber of Mines projects a 6.25% increase in gold production, reaching 5.1 million ounces this year. This uptick is driven by both large-scale projects, such as Newmont's Ahafo South and Shandong's Namdini mines, and a notable expansion in ASM activities. Despite contributing significantly to gold output, an estimated 70–80% of ASM operations remain unlicensed, complicating efforts to regulate the sector and mitigate its environmental impact. The environmental consequences of unregulated ASM are evident. In Senegal, similar practices have led to mercury contamination in the Faleme River, prompting a suspension of mining activities along its banks until 2027. In Ghana, the use of mercury and other hazardous chemicals in ASM poses serious risks to both ecosystems and public health. ADVERTISEMENT To address these challenges, the Ghanaian government has established the GoldBod initiative, aiming to streamline small-scale gold purchases and combat smuggling. The removal of withholding taxes has also been implemented to reduce illegal trade. However, enforcement remains a significant hurdle, with many ASM operations continuing outside the legal framework. The rise in ASM is not unique to Ghana. Across Africa, artisanal mining supports the livelihoods of millions but often operates in legal grey areas. In the Democratic Republic of Congo, for instance, ASM is a major component of the mining industry, yet it frequently involves child labor and unsafe working conditions. Efforts to formalize the sector have been inconsistent, leading to ongoing concerns about human rights and environmental sustainability. The World Bank has introduced a new framework to promote sustainable and inclusive ASM practices. This approach emphasizes the professionalization of artisanal miners, urging governments to implement regulatory measures that ensure environmental stewardship and social well-being. By fostering partnerships among governments, multilateral institutions, and civil society, the framework seeks to integrate ASM into the formal economy, enhancing transparency and accountability. Technological advancements offer potential solutions for sustainable mining. In Zimbabwe, the introduction of biological oxidation techniques has reduced pollution by 20%, minimizing the use of harmful chemicals like mercury and cyanide. Similarly, the adoption of renewable energy sources, such as solar and wind power, is transforming mining operations across Africa, reducing carbon footprints and operational costs. Despite these initiatives, the path to sustainable mining in Ghana remains fraught with challenges. The informal nature of ASM, coupled with limited access to financing and equipment, hampers efforts to improve efficiency and safety. Moreover, the lack of clear property rights and tenure security often leads to conflicts between artisanal miners and large-scale mining companies. To mitigate these issues, experts advocate for comprehensive reforms that include simplifying licensing processes, providing technical training, and ensuring fair market access for artisanal miners. By integrating ASM into the formal economy, Ghana can enhance regulatory compliance, protect the environment, and promote equitable economic growth.
