BY MBONO MDLULI
LOBAMBA – The Eswatini government is actively working to secure approximately E1.8 billion in loans to settle outstanding payments owed to suppliers. This initiative was announced by Minister of Finance Neal Rijkenberg during his Budget Speech on February 14, 2025.
Loan Details
The government plans to obtain loans from two major financial institutions:
– World Bank: Seeking USD 50 million
– African Development Bank (AfDB): Also seeking USD 50 million
These loans are intended to alleviate cash flow constraints and help clear existing arrears to suppliers.
Recent Payments and Challenges
On January 7, 2025, the government announced that it had settled all pending invoices for suppliers who submitted their bills before December 31, 2024. However, it was revealed that there are still other suppliers awaiting payment, highlighting ongoing challenges in managing government debts.
E. Nathi Dlamini, CEO of Business Eswatini, emphasized that the government’s debts to suppliers have created significant issues, as suppliers often need to secure loans from banks to fulfill government contracts. The interest accrued from the government’s failure to pay the E2.8 billion owed is estimated at around E170 million, which has adversely affected production across various industries.
Measures to Improve Payment Processes
Dlamini praised the government’s introduction of a price catalogue, which standardizes the prices of products supplied to the government. This measure aims to prevent the inflation of prices and the accumulation of debts. For instance, he noted that a product costing E10 could be sold to the government for E30, a practice he described as corrupt and a result of delayed payments.
Additionally, Dlamini commended the government for issuing a performance progress report that reflects positive developments and a commitment to improving the lives of citizens. He expressed optimism for a productive 2025, bolstered by the government’s Plan of Action report for the year.
