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1. Assessment of the Economic Costs of Electrical Power Outages in Swaziland

Author:
Eswatini Economic Policy Analysis and Research Centre
Publication Date:
05-2019
Content Type:
Policy Brief
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Electricity access has improved significantly since introduction of the National Energy Policy of 2003. However, challenges in electricity supply still exist due to the frequency of interruptions, which has resulted in harsh penalties and costs to the economy. In 2016, power outages cost Swaziland E700 million in nominal monetary terms, representing 1.67% of Swaziland’s Gross Domestic Product (GDP). If not addressed, the problems with the electricity sector will severely undermine the government’s effort to improve the development of the country. In essence, the benefits of increased access to the electricity grid will not be realised if power supply is as unreliable as it currently is. Considerable effort should be made to ensure that the country’s electricity supply system is stable and uninterrupted. Hence, in order to achieve this, there is need for policy attention towards improving the energy sector through investments in electricity generation using renewable energy sources, expediting the promotion of decentralised electricity generation to vulnerable areas, and setting stringent standards for the generation and distribution of electricity.
Topic:
Economics, Energy Policy, Infrastructure, and Electricity
Political Geography:
Africa and Swaziland

2. Quantifying the Size and Development of the Shadow Economy in Swaziland

Author:
Eswatini Economic Policy Analysis and Research Centre
Publication Date:
03-2019
Content Type:
Policy Brief
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
The size of the shadow economy has been declining at a slow rate over the past 16 years in Swaziland. The size of the shadow economy was found to be 37.4 % in 2016. This was equivalent to E20.5 billion of the Gross Domestic Product (GDP) in 2016. The key drives of the shadow economy in Swaziland were found to be the tax burden (direct and indirect taxation), self-employment, the importance of the agricultural sector and the institutional quality of governance institutions. For the country to fast tract its developmental agenda (Vision 2022), it is important for the country to enact policies that will harness and transition the shadow economy into the mainstream economy by targeting the drivers of the shadow economy locally.
Topic:
Development, Economics, Governance, and GDP
Political Geography:
Africa and Swaziland

3. The Socio-Economic Impacts of the 2015/16 EL Niño Induced Drought in Swaziland

Author:
Eswatini Economic Policy Analysis and Research Centre
Publication Date:
06-2019
Content Type:
Policy Brief
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
The 2015/16 El Niño drought proved to be the worst drought Swaziland has experienced since 1992. In total nominal monetary terms, the drought cost Swaziland minimally E3.843 billion, representing a 7.01% of Swaziland’s Gross Domestic Product (GDP) in 2016 or 18.58% of government expenditure in 2016. Despite the significant drought losses, the country has on paper a solid Disaster Risk Management (DRM) Policy (2010). However, even with extensive experience from past droughts in 2009/10, 2007, 2001, and 1992, the country is still struggling to become drought proof. The reason Swaziland is so affected by drought is that the country’s economic backbone rests on agriculture. The inherent vulnerability to drought is that the food production system in the country is still highly dependent on direct rainfall. Due to chronic drought-like conditions in the Shiselweni and Lubombo regions, households in these regions are now discouraged from participating in agriculture. To illustrate, an assessment of agricultural assets in households reveals that household participation in agriculture is less than 30%, with a measly national average of 25.3%. As a result, the country is now too dependent on the international, basically South African, market for its basic food needs. The implication is that as droughts become more frequent, their impact on the country will be detrimental to the economy, particularly on rural livelihoods.
Topic:
Economics, Environment, Natural Disasters, Socioeconomics, and Drought
Political Geography:
Africa and Swaziland

4. The Economic Benefits of Technical and Vocational Education and Training (TVET) in the Kingdom of Swaziland: A case of the National Handicraft Training Centre (NHTC)

Author:
Eswatini Economic Policy Analysis and Research Centre
Publication Date:
06-2019
Content Type:
Policy Brief
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Technical and Vocational Education and Training (TVET) in Swaziland is key for employment and self-employment opportunities which result in economic growth. TVET has proven to be an educational pathway that can be used to significantly reduce the unemployment rate by 2022. TVET graduates acquire skills that empower them to be immediately absorbed by the labour market and/or be self-employed. About 73.1% of the graduates are in productive employment after graduating from NHTC; with 47.6% formally employed, 25.5% self-employed, while 26.2% were unemployed in the period 1995 – 2015. The Benefit-Cost Ratio of NHTC, based on the Government of Swaziland and the Republic of China on Taiwan’s investment in NHTC, is 1:4.66. This means for every E1 invested in NHTC, the economy realises E4.66 through the income generating activities of graduates. The positive return on investment in NHTC indicates that if Government can increase funding to TVET institutions, the economic return can make significant contributions to skills development and GDP growth in the country.
Topic:
Economics, Education, Labor Issues, and Employment
Political Geography:
Africa and Swaziland

5. The State of the National System of Innovation in Swaziland

Author:
Eswatini Economic Policy Analysis and Research Centre
Publication Date:
03-2018
Content Type:
Policy Brief
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Swaziland, in the National Development Strategy (NDS), aspires to achieve development through investments in science, technology, and innovation (STI). However, using innovation to uplift the country from poverty and tackle economic growth requires investment in research and experimental development (R&D), human capital development, and the establishment of relevant institutions and governing bodies to direct scientific and technological development which are currently missing. Due to low investments in innovation and R&D, the lack of funding sources, absence of a national STI strategy and R&D agenda, and low collaboration between institutions, the country is struggling to propel STI-driven development. As a result, Swaziland is largely a consumption-based economy, with high imports and low exports, and the domestic industry is underdeveloped. The implication is that as economies grow and become more competitive, Swaziland will continue to remain behind. Hence, to use STI to drive social and economic development the country needs to affirm this concession by developing a national STI strategy. Establishing a Ministry of Science, Technology, and Innovation would enhance the coordination of STI activities and manage the funding and implementation of STI policies.
Topic:
Development, Economics, Science and Technology, and Innovation
Political Geography:
Europe and Switzerland

6. Industry Labor Force Skills Gap Investigation

Author:
Eswatini Economic Policy Analysis and Research Centre
Publication Date:
01-2018
Content Type:
Special Report
Institution:
Eswatini Economic Policy Analysis and Research Centre (ESEPARC)
Abstract:
Sluggish economic growth coupled with high unemployment rates have become synonymous with the economy in Swaziland. In particular, youth unemployment, which stood at 51.6% in 2014, the last year for which reliable data is available, has skyrocketed amidst limited opportunities for young people in the economy. Put differently, these figures suggest that one in every two young people in Swaziland is unemployed. Moreover, the ‘youth bulge’ – a situation in which the population share of the 15-24 year-olds exceeds 20% and the share of the 0-14 year-olds (often also referred to as the "children bulge" and a good predictor of future youth bulges) is higher than 30% –, means the country’s population is also growing faster than jobs are created. This calls for urgent strategies and public policies that can transform the economy, reignite economic growth, and capitalise on Swaziland’s youthful population. Technical Vocational Education and Training (TVET) has emerged as a credible route for the production of the necessary skills and knowledge that will feed directly into industry in a bid to enhance the employability of young people and create employment. Indeed, the talent, know-how, skills and capabilities of human capital can provide the relevant stock of competencies needed to increase efficiency and overall productivity in industry. However, at the present moment, there is very little information on whether or not the skills produced by the TVET sector in Swaziland are meeting the needs of industry. Conceivably, this has compromised efforts aimed at increasing the contribution of TVET in human capital development in Swaziland. In an attempt to make TVET education more relevant in Swaziland, His Majesty’s government has partnered with the government of the Republic of China on Taiwan, which has agreed to provide assistance in upgrading technical skills in Swaziland with a focus on the automotive, electrical engineering, and information and communications technology (ICT) industries. This Report presents the results of a TVET-industry skills gap analysis in the automotive, electrical engineering, and information and communications technology (ICT) industries in Swaziland. It investigates the relevancy of the skills supplied by the TVET institutions against the skills demanded/required by the three industries considered in this study. Closing the skills gap in the technical and vocational labour force could directly impact the productivity of local companies, create new enterprises, and enable the economy to grow through both formal and informal employment. The study focuses on four objectives: (i) to ascertain the development trends in each of the three industries and specify the existing challenges and opportunities; (ii) to assess the capacity and quality of Swaziland’s TVET system and its position to serve the skills required by industry; (iii) to identify the gaps between the skills supplied by TVET training institutions in Swaziland, (particularly, SCOT, and Gwamile VOCTIM) versus the skills demanded by the automotive, electrical, and ICT industries; and (iv) to recommend strategies for reducing the labour force skills gap within the three focus industries.
Topic:
Economics, Education, Employment, Economic Growth, Training, Vocational Training, and Industry
Political Geography:
Africa and Swaziland