ECONOMY
Swaziland
ranks among the more prosperous countries in Africa. Most of the
high-level economic activity is in the hands of non-Africans,
but ethnic Swazis are becoming more active. Small entrepreneurs
are moving into middle management positions. Although 70% of Swazis
live in rural areas, nearly every homestead has a wage earner.
The past few years have seen wavering economic growth, which has
been exacerbated by the economy's inability to create new jobs
at the same rate that new job seekers enter the market. This is
due largely in part to the country's population growth rate, which
strains the natural heritage and the country's ability to provide
adequate social services, such as health care and education. Overgrazing,
soil depletion, drought, and floods are persistent problems.
Nearly
60% of Swazi territory is held by the Crown in trust of the Swazi
nation. The balance is privately owned, much of it by foreigners.
The question of land use and ownership remains a very sensitive
one. For Swazis living on rural homesteads, the principal occupation
is either subsistence farming or livestock herding. Culturally,
cattle are important symbols of wealth and status, but they are
being used increasingly for milk, meat, and profit.
Swaziland
enjoys well-developed road links with South Africa. It also has
railroads running east to west and north to south. The older east-west
link, called the Goba line, makes it possible to export bulk goods
from Swaziland through the Port of Maputo in Mozambique. Until
recently, most of Swaziland's imports were shipped through this
port. Conflict in Mozambique in the 1980s diverted many Swazi
exports to ports in South Africa. A north-south rail link, completed
in 1986, provides a connection between the Eastern Transvaal rail
network and the South African ports of Richard's Bay and Durban.
The sugar
industry, based solely on irrigated cane, is Swaziland's leading
export earner and private-sector employer. Soft drink concentrate
(a U.S. investment) is the country's largest export earner, followed
by wood pulp and lumber from cultivated pine forests. Pineapple,
citrus fruit, and cotton are other important agricultural exports.
Swaziland
mines coal and diamonds for export. There also is a quarry industry
for domestic consumption. Mining contributes about 1.8% of Swaziland's
GDP each year but has been declining in importance in recent years.
Recently,
a number of industrial firms have located at the industrial estate
at Matsapha near Manzini. In addition to processed agricultural
and forestry products, the fast-growing industrial sector at Matsapha
also produces garments, textiles, and a variety of light manufactured
products. The Swaziland Industrial Development Company (SIDC)
and the Swaziland Investment Promotion Authority (SIPA) have assisted
in bringing many of these industries to the country. Government
programs encourage Swazi entrepreneurs to run small and medium-sized
firms. Tourism also is important, attracting more than 424,000
visitors annually, mostly from Europe and South Africa.
From the mid-1980s, foreign investment in the manufacturing sector boosted economic growth rates significantly. Beginning in mid-1985, the depreciated value of the currency increased the competitiveness of Swazi exports and moderated the growth of imports, generating trade surpluses. During the 1990s, the country often ran small trade deficits. South Africa and the European Union are major customers for Swazi exports.
Swaziland became eligible for the African Growth and Opportunity Act (AGOA) in 2000 and qualified for the apparel provision in 2001. AGOA created over 30,000 jobs, mostly for women, in Swaziland’s apparel industry. However, the industry suffered in 2005-2006, due to both increased global competition as a result of the end of the Agreement on Textiles and Clothing (ATC) on January 1, 2005, and the strong Rand (Swaziland’s currency is linked to the South African Rand at par), which reduced exports.
Swaziland, Lesotho, Botswana, Namibia, and the Republic of South Africa form the Southern African Customs Union (SACU), where import duties apply uniformly to member countries. Swaziland, Lesotho, Namibia, and South Africa also are members of the Common Monetary Area (CMA) in which repatriation and unrestricted funds are permitted. Swaziland issues its own currency, the lilangeni (plural: emalangeni).
GDP (2004): $2.8 billion.
GDP real growth rate (2005): 1.8%.
Per capita income (2004): $1,553.
Inflation (2006): 5.4%.
Natural resources: Coal, diamonds, quarry stone, timber, talc.
Agriculture (15.7% of GDP): Products--sugarcane, corn, citrus fruits, livestock, wood, pineapple, tobacco, rice, peanuts.
Manufacturing (35.0% of GDP): Types--sugar refining, light manufactured goods, wood pulp, textiles, processed foods, consumer goods.
Trade (2003): Exports--$920.2 million: soft drink concentrates, sugar, pulp, canned fruits, cotton yarn. Major markets--South Africa, EU, Mozambique, U.S. Imports--$1,018.8 million: chemicals, clothing, foodstuffs, machinery, motor vehicles, petroleum products.
