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1. The Economic Benefits of Vocational Education and Training in the Kingdom of Eswatini

Author:
Gugulethu Mgabhi and Mangaliso Mohammed
Publication Date:
01-2020
Content Type:
Working Paper
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
This study assesses the economic benefits of the Government of Eswatini’s investment to technical vocational education and training (TVET) from 2005 to 2017. TVET Graduates from 12 public TVET Institutions have been tracked to uncover their absorbability in the labour market and, or self-employment. The study finds that the economic return of the Government of Eswatini’s investment to TVET in 2017 is E1,51. This means that for every E1 invested by the Government of Eswatini to TVET, the economy generates E1,51 through the TVET graduates’ activities in self-employment, formal employment, and part-time skills utilisation. With regards to highly demanded courses amongst the graduates, ccomputer studies have been found to be highly demanded at 20.9%, while agriculture is lowly demanded at 6.3%. The study finds that 56.6% of the graduates are absorbed in formal employment, while 13.7% are engaged in self-employment, meaning that 29.9% are part of the 32.4% unemployed persons in the country. However, the level of unemployment is still high, 43.3%. Graduates who were not economically active before enrolling at the TVET colleges have been found to be formally employed, 35%, 14% are self-employed, 2.5% are both formally and self-employed, while 48.5% are unemployed. A majority (58.5%) of employed graduates are from Gwamile VOCTIM, while self-employment is high amongst graduates from Big Bend Rural Education Centre, 44.4%. Unemployment has been found to be very high among graduates from Ekululameni, 100%. The study recommends that the Government of Eswatini should consider promoting self-employment amongst graduates. This could be done through establishing links with financing agencies to increase the rate of self-employment and reduce unemployment.
Topic:
Economics, Education, Governance, Training, Vocational Training, and Investment
Political Geography:
Africa and Eswatini

2. Financial Inclusion in Eswatini: What is Driving the Adoption of Mobile Money?

Author:
T. Magongo
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Mobile money has gained increasing importance and prominence in many sub-Saharan African countries and as a result, it is seen as a possible key to fast-tracking financial inclusion in developing countries including Eswatini. Although financial inclusion rates have improved considerably in Eswatini, the adoption of mobile money is still relatively low in the country compared to other countries in subSaharan Africa, yet a majority of the population knows about the technology. This study investigates the driving factors of mobile money adoption in Eswatini using a logit and probit analysis based on the 2014 FinScope Financial Access and Consumer Survey. Findings reveal that the likelihood of using mobile money increases with increasing levels of financial literacy, education, sending and receiving remittances using mobile money, usage of informal financial products, living in an urban area, and adjusting income during times of shock. Results suggest opportunities for financial inclusiveness such as designing and implementation of financial literacy education and money management programs, purposely targeting the underserved population (rural), as well as informal financial product usage formalization.
Topic:
Development, Economics, Finance, and Inclusion
Political Geography:
Africa and Eswatini

3. Economic Impact Analysis of Credit Guarantee Schemes in Eswatini: A Case of the Small Scale Enterprise Loan Guarantee Scheme (SSELGS)

Author:
Maqhawe Zwane
Publication Date:
01-2019
Content Type:
Working Paper
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Using data from 315 beneficiaries of the Small Scale Enterprise Loan Guarantee Scheme, this study assesses the impact of the Small Scale Loan Guarantee Scheme. The study assessed both the financial and economic additionality of the scheme. The study used a structured questionnaire and face-to-face interviews to elicit data from beneficiaries whereas key informant interviews were used to elicit data from participating banks. The study also assessed visibility of the scheme as well as its efficiency in terms of loan approval period and claim processes. From the sampled beneficiaries, 174 SMEs would not have accessed credit if the scheme was non-existent. Collectively, these SMEs received E42, 918,616.00. On the other hand, 72 of the 174 started new businesses and at the time of the interview, they collectively employ 681 people. The study found that the default rate is high at 44.3 %. The approval period of loan application varies widely, with some respondents reporting a period of less than a month while others reported a period of up to four years. The study concludes that the scheme has made a positive impact in both financial and economic additionality. However, two factors (inefficiency in scheme’s operation and high default rate) threaten the scheme’s existence. It is therefore a recommended that scheme managers should put measures to curb the default rate and improve the efficiency and visibility of the scheme.
Topic:
Economics, Business, Credit, and Loans
Political Geography:
Africa and Eswatini

4. An Insight into Community-Based Ecotourism in Eswatini: Theory versus Practice

Author:
Tamika Du-Pont and Thabo Sacolo
Publication Date:
01-2019
Content Type:
Working Paper
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
The study provides a baseline of the performance of Community-based Ecotourism (CBET) ventures in Eswatini using primary data collected from 186 participants. The data was collected through face-to-face interviews amongst across five CBET sites. Descriptive and thematic analysis were used to identify; the benefits of CBET accrued to host communities, challenges communities experience in providing goods and services to CBET ventures, and the factors preventing broad based participation. Frequencies of responses were used to determine the perceptions and attitudes of host communities towards CBET. The study finds that many of the promises of CBET have not been fully met in Eswatini. Economic benefits have not been widespread and remain minimal, with approximately 42 jobs in total. Participants receive an average monthly income of E1457.40 ± 933.80, an indication of high disparities in monetary incentives amongst participants. The study finds that CBET has been a catalyst for infrastructural development within rural landscapes and provides participants with additional intangible benefits such as a sense of empowerment and belonging. Poor infrastructural maintenance, inadequate marketing and declining tourist visitations are major threats to the sustainability of CBET ventures. Efforts to augment the performance of CBET in Eswatini should focus on investment in research and monitoring of present and potential new CBET ventures. The study recommends integrated and inclusive policies that will promote and allow for expanded local production in the tourism supply chain, partnerships between host communities and industry experts, and local capacity enhancement to reignite CBET within the tourism sector as a serious contender for economic growth.
Topic:
Economics, Tourism, Employment, and Community
Political Geography:
Africa and Eswatini

5. Assessing the Relationship between Brain Drain and the Economy of Eswatini

Author:
Zamokuhle Manana
Publication Date:
01-2019
Content Type:
Working Paper
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Eswatini has been experiencing the brain drain phenomenon since the early 90s. Previous studies on the phenomenon attribute the brain drain to high unemployment and the labour market’s inability to absorb emaSwati. With that said, there are still no studies have been conducted to quantify the impacts of brain drain on the economy of the country given its upward trajectory. It is on this premise, that this paper quantifies and assess the relationship between brain drain and economic growth in the short-run. To this end, the study employs secondary annual time series data from the World Bank Indicators for the period 1991 to 2017. The study employs the Bounds approach for co-integration and the short-run Autoregressive Distributed Lag (ARDL) model as estimation techniques. The bounds test found that there is no long-run equilibrium relationship between the variables. According to the ARDL short-run model the study found that all other things being equal, when brain drain increases by 1 percent at a given time period, Gross Domestic Product increase by E171 million the following year in the short-run. Furthermore, the Granger causality test reveals a unidirectional relationship running from Gross Domestic Product to brain drain at the 1% significance level, that is, past economic growth trends is an important predictor of future brain drain trends.
Topic:
Economics, Intelligence, GDP, and Unemployment
Political Geography:
Africa and Eswatini