MBABANE – Eswatini’s Treasury financial reports, tabled in Parliament, unveil a debt portfolio with Mainland China-linked institutions leading the way, accounting for over E7 billion in loans. Concerns arise over the country’s ongoing reliance on loans amidst geopolitical considerations.

As of March 31, 2023, the African Development Bank (AfDB) emerged as the largest lender, with E3.89 billion in loans, closely followed by the Exim Bank of China at E3.25 billion. The World Bank also features prominently, extending over E3.2 billion in loans.

Additionally, the International Monetary Fund (IMF) and Probase stand out as major lenders, with E1.88 billion and E1.25 billion respectively. Notably, Inyatsi Construction Company secured over E520 million for the Sicunusa-Gege Road construction.

The total debt stock stood at E32.6 billion, equivalent to 30.4% of the Gross Domestic Product (GDP). External debt amounted to E15.1 billion, constituting 17.9% of GDP, while domestic debt reached E19.4 billion, representing 22.9% of GDP.

During the 2023/24 financial year, external debt surged by 46%, reaching E15.054 billion, driven primarily by multilateral creditors, accounting for 75% of total debt. Bilateral sources contributed E3.6 billion (24%), with private/commercial lenders making up the remainder.

USD denominated debt dominated at 35%, exposing the debt portfolio to exchange rate fluctuations. Concerns over the sustainability of international loans persist, with critics warning of potential economic strain. Minister of Finance Neal Ri Jenberg disclosed that E2.3 billion was allocated to service debt interests, emphasizing the fiscal burden on the nation.

Despite efforts to service loans through tax revenues, concerns linger over the long-term implications of debt accumulation. Ri-jkenberg highlighted the loans’ accruing interest during the grace period, underscoring the need for prudent