Mbabane, Eswatini, September 8, 2022—The Kingdom of Eswatini can grow its economy, create jobs, boost exports, and speed economic recovery from COVID-19 by introducing reforms to build a stronger private sector and attract investment into key sectors, according to a new report published today by IFC and the World Bank.
The Eswatini Country Private Sector Diagnostic (CPSD) highlights reforms needed to increase Eswatini's competitiveness to unlock export potential and increase private sector participation to sustainably grow its economy. The CPSD suggests strengthening the trade and regulatory environment and reducing the state footprint in sectors that can be better served by the private sector. It also encourages private participation in key enabling sectors like telecommunications and energy.
The report outlines actions Eswatini can take to unlock the potential of four important sectors, sugar, beef, forestry, and textiles/apparel. These sectors have greater job creation and value addition potential and can help expand export markets, according to the CPSD.
The MSME sector, which accounts for 40 percent of employment in the country, could be better supported by developing regulations to foster new financial products, including digital products, and more effective programs to improve skills and capabilities.
"The CPSD provides concrete reform proposals as Eswatini recovers from the COVID-19 pandemic and looks ahead. The World Bank Group supports Eswatini to return to growth that expands job opportunities, reduces poverty and brings shared prosperity in a sustainable manner," said Marie Francoise Marie-Nelly, World Bank Country Director for Botswana, Eswatini, Lesotho, Namibia, and South Africa.
"Eswatini can speed economic growth by supporting micro, small, and medium enterprises to thrive and by enabling the private sector to take a leading role in the economy," said Adamou Labara, IFC's Country Manager for Eswatini. "By focusing on export-led private sector growth and entrepreneurship, Eswatini can restore its past performance, create jobs, and sustain growth in an inclusive manner."
Despite its lower middle-income status, Eswatini's development challenges -- high unemployment, especially among women, young people, and those in rural areas, and high poverty and inequality --mirror those of low-income countries. COVID-19 caused widespread business closures, and job and export losses, further slowing growth.
Eswatini's economy also faces the impact of climate change, with drought threatening the country's environmental and socioeconomic stability.
The CPSD aligns with reform commitments outlined in Eswatini's National Development Plan 2019/20–2021/22 and its post-COVID-19 Economic Recovery Strategy. The World Bank Group is committed to supporting Eswatini to accelerate key reforms in sectors with high export and job-creating potential.
About the Country Private Sector Diagnostic (CPSD).
Launched in 2017 as a corporate priority, the World Bank Group's Country Private Sector Diagnostics support the institution's strategic focus on expanding private investment and leveraging private solutions to address development challenges in client countries. The diagnostics assess critical constraints to private sector engagement and identify policy and regulatory reforms needed to unleash private sector growth. They are jointly delivered by the World Bank and IFC. For more information, visit www.ifc.org/cpsd.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
About the World Bank
The World Bank provides financing, global knowledge, and long-term commitment to help low- and middle-income countries end poverty, achieve sustainable growth, and invest in opportunity for all. We comprise the International Bank for Reconstruction and Development (IBRD), the world's largest development bank, and the International Development Association (IDA), one of the largest sources of funding for the world's poorest countries. With the other World Bank Group institutions as well as partners across the public and private sectors, we are helping build solutions to the global challenges of the 21st century in all major sectors of development. A world where no one lives in poverty and everyone has the opportunity for a better life is within our reach.
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