MINISTER of Finance Neal Rijkenberg tabled E2.2 billion loan bills before senators yesterday.
In a meeting held at The Royal Villas, he said the four loan bills would give him a go ahead to seek finance for the development of different sectors including the youth empowerment.
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Rijkenberg said the country would be able to develop other sectors economically; the water, sanitation and hygiene (WASH) in the rural areas and close gaps in the budget especially payment for suppliers.
The institutions that the country will seek loans from are the International Bank for Reconstruction and Development, the International Development Association (IDA), the African Development Bank (AfDB) and the Opec Fund.
The loans Bills include E138.4 million (US$8 million) for the water project and E467.1 million (US$27 million) from IDA funding, which he said was very cheap because it is almost half grant for the youth project. Government is simultaneously leveraging the financial credibility and setting sights on securing new funding from other lenders including the World Bank and the African Development Bank (AfDB) for new financing to manage arrears.
READ MORE: Economist Urges Government to Delay New Loans Despite IMF Settlement
“Other loan bills have been submitted to Parliament, including E865 million (US$50 million) facility from OPEC Fund and E821.7 million ($47.5 million) loan from AfDB which will ensure that suppliers are paid,” he said.
The World Bank requires Eswatini to meet nine prior actions. World Bank documentation indicates that such actions include measures to strengthen public financial management, increase transparency in debt reporting and improve fiscal discipline.
These conditions were designed to ensure that countries avoided slipping back into arrears and maintain a sustainable debt path.
During the question and answer session, Senator Princess Ntfombiyenkhosi said she was empathetic about the situation on the ground, especially the high unemployment rate of the youth in the country.
She said the thorny issue was depicted during the ongoing recruitment exercise for the Umbutfo Eswatini Defence Force (UEDF), which she said was insignificant since only three people per constituency would be hired.
Senator Lizzie Nkosi raised concerns about the 15 years repayment period for some of the loans, citing one from OPEC Fund.
She said it sounded like the loans were temporal solutions not long term. She noted that it was not the first time she raised such concerns.
Meanwhile, Senator Lorrain Nxumalo suggested that they followed the Strategic Oil Reserve model where government did not repay the loan because the investors would be making money and profits.
Senator Fezeka Dlamini noted the country’s initiatives for the youth including the Youth Enterprise Revolving Fund (YERF). She said they seemingly did not address the unemployment issue among the youth.
“Minister, I feel that the loan should be redirected to the ministry of education and training to revamp the curriculum because that is where our problem is,” she said.
In response, Rijkenberg said the loan bills would help the unemployed youth regardless of interventions. He pleaded with the senators to support and pass the four bills so that the country could develop in all sectors.
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