Africa-Press – Eswatini. Government’s proportion for capital expenditure could induce a long-term negative effects on economic growth.
This could be due to the fact that the international market, where most of the materials were sourced, had not yet stabilised their prices. However, the increase in budget allocation could have taken into consideration the risk of uncertainty. This is as per an analysis by the Southern African Research Foundation for Economic Development’s (SARFED) of the budget speech presented by the Minister of Finance, Neal Rijkenberg, to Parliament last Friday. The appropriated capital expenditure announced by the minister in the budget speech was E5.36 billion.
Regarding unemployment, SAREED said despite the fact that more jobs were expected to be created as a result of factory shells being established, the national budget did not point out its quick fix measures to address issues of current job losses caused as a result of both COVID-19 as well as social unrest which resulted in many small, medium and large firms to either scale down or completely shut down.
Widening
The ripple effect of this would be that of widening the social gap. SARFED, through Regional Coordinator George Choongwa also addressed the issue of export markets. He noticed that the minister mentioned that one of the key aims of Eswatini was to accelerate and become one of the competitive export-driven countries in the sub-Sahara Africa. However, limited information was shared on how competitive and what strategies Eswatini was embracing in championing international trade market during and post-COVID-19 crisis,” said Choongwa.
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