Discover Eswatini

Eswatini’s economy presents a landscape of contrasts. The kingdom boasts a well-developed manufacturing sector that thrives within the Southern African Development Community (SADC) due to preferential trade agreements. This has positioned Eswatini as a reliable regional supplier, attracting foreign investment in export-oriented industries. Tourism flourishes due to Eswatini’s stunning natural beauty and rich cultural heritage, generating foreign currency and creating service sector jobs.

However, significant challenges remain. High unemployment, particularly among youth, and widespread poverty threaten economic growth. Limited water resources and reliance on rain-fed agriculture constrain agricultural productivity, hindering food security and rural livelihoods.

Industry: A Manufacturing Powerhouse with Diversification Potential

Manufacturing reigns supreme as the backbone of Eswatini’s economy, contributing significantly to the Gross Domestic Product (GDP). The textile and apparel industry is a major player, attracting foreign investment due to favorable production costs and trade agreements like the African Growth and Opportunity Act (AGOA) that grant duty-free access to the U.S. market. This industry not only generates export revenue but also provides crucial employment opportunities, particularly in urban centers. However, over-reliance on a single industry exposes Eswatini to external economic fluctuations. Diversification into higher value-added industries and fostering innovation are crucial steps to ensure long-term economic resilience.

Agriculture: Balancing Tradition with Modernization

Despite a recent decline, agriculture remains a vital sector for Eswatini, employing a significant portion of the population and ensuring food security for many households. Subsistence farming, where families cultivate crops primarily for their own consumption, remains widespread, particularly in rural areas. Cash crops like sugar and citrus fruits are also significant contributors, generating income for rural communities. However, limited arable land and reliance on unpredictable rainfall patterns pose significant challenges. Modernizing agricultural practices through improved irrigation systems and promoting sustainable land management techniques are crucial to ensure the sector’s long-term sustainability.

Service Sector: Poised for Growth

The service sector is steadily expanding, driven by tourism and government services. Eswatini’s breathtaking natural beauty, ranging from the majestic Drakensberg Mountains to sprawling savannas teeming with wildlife, combined with its rich cultural heritage, make it an attractive tourist destination. The government remains the largest employer, providing essential public services. However, fostering entrepreneurship and attracting foreign direct investment (FDI) in knowledge-based industries like information technology and business process outsourcing (BPO) are crucial steps to diversify the service sector and create a more dynamic economy. Investment in education and training programs to equip the Swazi workforce with the necessary skills to thrive in these new industries is essential.

Infrastructure: Bridging the Gap for Inclusive Growth

Eswatini’s infrastructure is undergoing development, with a focus on improving transportation and communication networks to meet the growing demands of its economy:

• Transportation: A well-maintained road network connects major towns and cities, facilitating the movement of goods and people within the kingdom. However, rural areas may lack proper access roads, hindering agricultural development and limiting access to essential services for those residing in remote locations. Upgrading rural infrastructure is essential for inclusive growth. International connections are facilitated by Matsapha International Airport, offering limited air travel options. Expanding air cargo capacity could further enhance Eswatini’s participation in regional and international trade.

• Communication: Mobile phone penetration is high, particularly in urban areas, ensuring relatively good connectivity across the country. This fosters communication and information exchange, playing a vital role in social and economic development. However, access to high-speed internet, particularly reliable broadband connections, remains limited in some areas, especially rural ones. This digital divide can hinder educational opportunities and limit access to essential online services like e-commerce and telemedicine. Investing in expanding broadband infrastructure is crucial for bridging the digital divide and ensuring equitable access to the information age.

Financial System: A Pillar of Stability

Eswatini’s financial system is relatively stable, with a well-established banking sector that plays a critical role in channeling investments and facilitating economic activity:

• Central Bank: The Central Bank of Eswatini (CBE), formerly known as the Central Bank of Swaziland (CBS), regulates the financial system and maintains monetary policy. The CBE’s role is to ensure price stability, promote a sound financial system, and foster economic growth.

• Commercial Banks: Several commercial banks operate in Eswatini, offering a range of financial services to individuals and businesses. These institutions play a vital role in providing loans, facilitating deposits, and enabling money transfers. Ensuring a competitive banking sector with a focus on financial inclusion is crucial for broadening access to financial services, particularly for unbanked or underbanked populations. This can be achieved by exploring innovative solutions like mobile banking and microfinance.