September 2, 2011

Crisis deepens as loan stalls / Global Day of Action on Independence Day / Students boycott classes

September 6th is Swaziland’s Independence Day. It is also the second international day of action on Swaziland, with the Swazi democracy movement planning a "global day of action". The Swaziland Federation of Trade Unions has also announced its intention to engage in solidarity protests.

The planned protests come amidst new fiscal problems in the country, as South Africa admitted it had not paid the first slice of an emergency 2.4 billion rand ($342 million) loan in August, as previously expected. “We were aiming for August. We're still in discussion with the Swazi authorities,” South African Treasury spokeswoman Kershia Singh said. “It's obviously taking longer than we anticipated.” She declined to say when the agreement, which was unveiled a month ago, might be concluded or what was holding it up.
The crisis has already sparked unprecedented demonstrations against the UK-educated monarch, who has at least a dozen wives and a fortune estimated at $200 million. The absence of the funds, seen as the final lifeline of an unelected administration that appears to have run out of money, may mean civil servants receiving their pay late, if at all -- piling more political pressure on King Mswati III. "It is a material fact that progress can only be achieved through action and sometimes confrontation," South Africa's powerful NEHAWU health workers union said in a statement calling for a mass uprising. "The people of Swaziland owe it to themselves and the next generation to make a united stand against this corrupt and brutal dictatorship."

Furthermore, Swaziland’s only university has reopened a month late for the new academic year, but the nearly 6000 students are boycotting classes over cuts in their allowances, which the government says will only be paid in a few months time. “These allowances not only pay for students’ room and board, transport and books but they also are used by families to pay for the education of the students’ relatives. This suspension will lead to a domino effect throughout the education system so that none but the rich are able to afford schooling,” Ntombi Dlamini, one of the affected university students, said.

The government has said allowances which ranged from US$3,500 per annum for students living off campus, to $1,250 for students living on campus, would be reduced by 60 percent.

The Swaziland Solidarity Network (SSN), an umbrella organization of pro-democracy NGOs, said in a statement: “With the current fiscal crisis, the government has reduced allowances to an amount that effectively makes it impossible for most students to continue with their studies. “Most students in Swaziland come from very poor backgrounds where their tertiary education is the only hope of them escaping the cycle of poverty. Such students are known to use the little allowances that they get from the Swazi government to help their younger siblings through school and to help them with their living expenses. “With the cut in students’ allowances, the Swazi government is effectively saying that only those students who come from well-to-do families will be able to afford to have tertiary education,” the SSN statement said.

Furthermore, Wilson Ntshangase, minister of education, cast doubt in a recent radio broadcast that the country’s primary schools would open later this month for the final term of the year, because of financial considerations. According to local media, the Education Ministry has held meetings with school principals indicating that the payment of school fees for orphans and vulnerable children (OVCs) across all school grades was also in doubt. OVCs are estimated to comprise nearly half of the country’s school enrolment and their school fees ensure the schools can pay their bills.

The International Monetary Fund (IMF) declined a bail-out to Swaziland for among other reasons its failure to reduce its public sector wage bill, which is seen as far too large for the country’s size. King Mswati III, sub-Saharan Africa’s last absolute monarch, resorted to South Africa for assistance to prevent a financial collapse.

However, the government has reportedly amassed US$180 million in unpaid bills, and the South African loan is merely seen as providing a temporary lifeline for the economy. The loan has been agreed but not enacted as yet, as conditions for it are similar to those imposed by the IMF.

The IMF, after completing a two week assessment, said in a statement on 31 August 2011 that the country’s reserves had dropped to below the three months import cover, which is generally considered the cut-off point for a stable currency. The pegging of the emalangeni, the local currency, to the South African rand, is seen as the only barrier preventing the currency from being affected by rapid inflation. The IMF statement said: “The fiscal crisis in the Kingdom of Swaziland continues to deepen. The mission concurred with the authorities’ views that the government will continue to face severe liquidity constraints over the coming months, notwithstanding the recently announced 2.4 billion rand loan from the South African authorities. “In this context, the mission advised the government to pass a supplementary budget to cut expenditures, while preserving pro-poor spending, and strengthen expenditure controls in order to restore fiscal sustainability. (IRIN/IOL/SADOCC)

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