…..Eswatini GDP at 38.4 % and stood at E84.847 billion as of March 31, 2023
BY MBONGENI NDLELA
MBABANE – Even though Eswatini’s Public Debt increased by 23 percent in 2023, government Auditors believe that the country is still rated better when compared with other countries in the SADC Region.
Public debt refers to the amounts owed by the different levels of government and used to finance public deficits resulting from a higher level of program spending to budgeted income.
According to the Financial Audit Report on the Consolidated Government Accounts of Eswatini for the Financial Year ended on March 31, 2023, which was released in Parliament yesterday, Eswatini’s public debt increased by 23 percent in 2023 when compared to 2022.
“The figures show that total Public Debt stood at E32.6 billion as of 31st March 2023 compared to E26.5 billion as of 31st March 2022,” reads the report.
The increase in Public Debt has been attributed mainly to External Public Debt (external debt is the debt owed to lenders outside the country) as opposed to Domestic Public Debt (debt owed to creditor residents in the same country).
The report states that the current year’s Domestic Debt recorded E17.5 billion whilst External Debt totalled E15.05 billion. The increase in Domestic Debt is 4.8 percent from E16.7 billion in the previous financial year ended on 31st March 2022, it is said.
“On the other hand, External Public Debt took a massive increase of 53 percent from E9.8 billion in the previous year to E15.05 billion in the current year. This sharp increase considering that in the previous year the movement was a decrease of 5.5 percent from the preceding financial year,” it reads.
It is further reported that the increase in External Public Debt is quite alarming, it is not only accredited to the issuance of new loans by government.
In fact, the Auditors said the increase is also attributed to the volatile movements of exchange rates on foreign currencies and continuous drawdowns.
“On the other hand, the increase in Domestic Debt is due to the outstanding treasury stock and treasury bonds as well as disbursements made during the year.
According to reports by the Ministry of Finance and the Central Bank, the total Gross Domestic Product (GDP) of the country stood at E84.847 billion as of 31st March 2023.
“This means that as a percent of GDP, total Public Debt stood at 38.4 percent as of 31st March 2023. In the previous year, the country reported a ratio of 37.2 percent of Public Debt to GDP. External Public Debt contributed 17.8 percent whilst Domestic Debt contributed 20.6 percent to this ratio,” reads the report.
It further states that it worth noting is that the 38.4 percent of GDP shows a slight increase of 1.2 percent from the previous year’s 37.2 percent.
“though the 32.4 percent is above the 35 percent threshold recommended by Breton Woods Institutions (IMF and the World Bank Group), it is within the Southern African Development Community threshold which is above 50 percent. Thus the country is still rated better when compared with some countries in the SADC Region,” it reads.
