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MBABANE – Business Eswatini (BE) has summed up the Minister of Finance, Neal Rijkenberg’s, budget speech as sensible and unpretentious; and one that lays a strong foundation.
BE Chief Executive Officer (CEO) Nathi Dlamini said the minister was starting off from a particularly stronger foundation this year than before. Dlamini said the fiscal deficit has come down to 1.8 per cent of gross domestic product (GDP) from 4.8 per cent, which suggested that the minister has been relentless in applying fiscal prudence throughout the previous year.
Undermine
Dlamini said the speech was a cautiously optimistic budget with some modicum of foreboding due to unknown future events, which could undermine the basis for the minister’s projections.
He said the minister’s speech was restrained and practical to a large degree: “The minister, thankfully, did not yield to the temptation of going gung-ho on new taxes – great move on his part.”
Dlamini said Rijkenberg seemed rather upbeat this time around and stopped short of being idealistic; most probably emboldened by the positive economic projections for this year and the next.
He said the 4.9 per cent GDP growth projections for 2024/25 was not a figure to be sneezed at primarily because, if attained, it would positively alter the national fiscus ratios in the right direction, including the country’s debt to GDP which currently stands at 39 per cent as well as well as the country’s fiscal or budget deficit which was estimated to be E1.84 billion or 1.96 per cent of GDP.
“If that is achieved it will create scope for government to manoeuvre through what seems like tight national cash flows,” Dlamini said.
The CEO mentioned that the minister made sure he was unmistakably restrained in his posture ostensibly in recognition of the fact that unforeseen exogenous factors and economic headwinds could easily disrupt his buoyant projections for this budget cycle.
Wounds
Dlamini said his (minister) general posture though was clearly a far cry from the previous budget speech when the country was still reeling from the fresh wounds of the social unrest and the deleterious impact of the pandemic.
Dlamini noted that the minister admitted that some E740 million was still owed to suppliers and these creditors were mainly BE members.
“We are pleased that the minister hopes to address this matter expeditiously. And BE stands ready to provide any assistance the minister may need in this regard.
“The scope of the debt book in the hands of the private sector is worrisome and will most definitely undermine economic growth if left unaddressed by way of settlement,” Dlamini said.