1 July 2011
Swazi loan has state in a quandary
The South African government is in a sticky spot.
Since King Mswati III of Swaziland made a request for R1.2-billion loan to bail his country out of its dire financial situation two weeks ago, South Africa remains caught between the need for stability in the region and standing up to what has been called Mswati's "illegitimate regime".
Swaziland, one of Africa's last absolute monarchies, asked for the money to pay its public servants, as it battles to remain afloat after losing nearly 60% of its revenue from the South African Customs Union.
The requested loan is merely a tenth of the R10-billion the Swazi government initially asked for.
According to Lucky Lukhele, the spokesperson for the Swaziland Solidarity Network, the first two loan requests failed because Swaziland refused to adhere to the terms and conditions set by South Africa.
"This R1.2-billion looks more like a handout from a friend. It doesn't have any conditions," he said.
Elizabeth Sidiropoulos, the national director at the South African Institute of International Affairs, said the treasury should reveal the conditions attached to the loan, if any, "in the interests of transparency", but that financial accountability was the most important consideration. "There is certainly a case to be made for political conditions. However, they are very difficult to implement in practical terms.
"Also, we are dealing with a country on our border, which, should it implode, will have major implications for South Africa. Desperate people will flock across our borders. Widescale unrest is difficult to deal with, politically and economically."
She said that although there was a moral case to be made about Swaziland's monarchy and its regime, "we must be careful to not take a stance that leads to instability". It was important to recognise that refusing the loan straight out was not going to bring stability to Swaziland.
"A good idea is to use this loan as an opportunity to open dialogue in good faith on political challenges. It's an opportunity to engage in a constructive manner on the removal of draconian legislation."
But Narnia Bohler-Muller, the director of social sciences research at the Africa Institute, thinks that the loan is not the right way to go.
"We know that 70% of the Swazi people live on less than a dollar a day, but if we give the money to the king, it won't get to the right people," she said. "There [must be] some way to get money through to non-governmental organisations without it going through government."
If South Africa granted the loan, the country would be even more unstable. "There will be more protests. The Swazi people have had enough of government corruption," she said.
Civil-society organisations in South Africa and Swaziland are opposed to South Africa granting the loan while Swaziland remains an undemocratic country. The Swaziland Democracy Campaign said this week: "It is reliably reported that the sum of R1.2-billion is to be handed over to a regime that is notoriously bad at managing the national treasury and preventing the chronic misuse of funds for corrupt purposes.
"One thing that we can be certain of is that a significant amount of it will go to maintaining the state's repressive apparatus." The Congress of South African Trade Unions and the South African Communist Party have also urged the treasury not to provide Swaziland with the money.
Meanwhile, Swaziland's financial crisis is beginning to take its toll on the ground with a number of public services being cut. This week, local media reported that all non-essential government vehicles were to be grounded because of a lack of fuel and only the security forces and emergency services would be able to fill up.
Magistrates and prosecutors are reported to be sharing lifts to court and it is said even the prime minister's wife no longer has access to a government vehicle to get around.
Although Health Minister Benedict Xaba denied claims that the country, which has the world's highest HIV rate (one in four adults is infected), was running low on antiretroviral treatment, correctional services commissioner Isaiah Mzuthini Ntshangase has admitted that, to save cash, prisoners will now get two instead of three meals a day.