Private Sector Involvement In Policy Making

The importance of stakeholder consultation is increasing globally and Eswatini cannot live in isolation.[…]

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The importance of stakeholder consultation is increasing globally and Eswatini cannot live in isolation. Consultations give people in all walks of life a chance to get involved in the work of government. Stakeholder Consultation is an important part of the policy-making process; that is to say that, before any policy is gazetted it is critical for the government to engage relative stakeholders. As economies are becoming increasingly competitive, there is increasing need for Private Sector players to engage in policy development.

Who is a Stakeholder?
By definition a stakeholder is a person, a group or an organization that must be taken into account by policy makers before any policy decisions are made. This is an individual who can affect or be affected either positively or negatively by a policy reform. A few examples of stakeholders are shareholders, trade unions, communities and customers. Every Swazi Citizen has the right to have their voice and concerns heard, they have the right to influence policy and Government decisions. The right to be stakeholders and participate in decision making is guaranteed by the Constitution of Swaziland.

Benefits of Effective Public Engagement
When done well, public engagement can have a number of advantages for policymaking, including strengthening the democratic legitimacy of policy, by ensuring that citizens are able to take and influence the decisions that affect their lives.
The practice also increases the accountability of government, by ensuring that citizens are aware and can respond to the decisions that government takes.
When the public is involved in decision making the quality of policy is improved, by ensuring as broad a range of knowledge, views and values as possible are present in the process and ensuring that policy goes with the grain of public values.

Current Process of Consultation
Although considerable lip-service is given to the importance of broad-based Private Sector participation and consideration of the Private Sector as a key stakeholder in the new economic reform process, the realization of that objective has been neither automatic nor simple. The private sector itself has a key interest in taking a prominent role in the development of policies that affect it, but it also needs opportunities and the means to provide input.
The current consultation process used by the Government is not always consistent or designed with implementation in mind; it can be argued that in some cases the consultation is done as a formality. Shortcomings of the current approach include:

  • Policy is drawn up on the basis of a range of inputs that is too narrow;
  • Policy is not subject to sufficient external challenge before it is announced;
  • The policy development process, and the evidence and data underlying it, is insufficiently transparent;
  • Policy insufficiently reflects the reality experienced by citizens; and
  • Policy is often developed with insufficient input from those who will have to implement it.

Proposed Process of Consultation
An ideal consultation process should involve comprehensive stakeholder participation and it should provide a feedback mechanism to the stakeholders after policy comments and submissions. Highlighted below is the suggested method that may be followed during stakeholder consultations.
  • Prior to any discussions, all affected stakeholders should be furnished with the relevant documents beforehand to adequately familiarise themselves with the issue at hand to enable meaningful contributions;
  • During the initial meeting, comments from all stakeholders should be obtained, presented, discussed and noted.
  • Thereafter, stakeholders should be allowed adequate time of at least their written comments.
  • A validation meeting of Stakeholders should be convened, wherein the agency responsible leads discussions and presents the final draft of the legislation. In that process the comments submitted by stakeholders will be discussed and any input and comments excluded be highlighted and valid reasons for the omission if any, be presented and discussed as part of the validation process.

The FSE&CC believes that to enable the private sector to engage in urban planning, public policy and development objectives, the public sector may:
  • Consider incentives that encourage private sector participation. World Bank research suggests legal and regulatory reform is necessary to support more sustainable economic growth and enhance the private sector’s impact.
  • Consider arrangements beyond PPPs to meet its financial needs (e.g. fiscal decentralisation, issuing municipal bonds, etc.) and non-financial obligations (improving service provision through better management of operating systems, reducing distribution and transmission costs, reducing water and electricity theft by informal network providers, combating corruption, promoting e-governance, etc.).
  • Implement specific policy instruments and interventions that complement, coordinate and collaborate with the private sector rather than compete against it.

Whilst, the FSE&CC acknowledges that multiple challenges of private sector involvement in development persist. The private sector is no doubt a major actor for creating economic opportunities for people living in poverty, through investment, generating employment, creating innovation and generating revenue for social sectors. To unlock the full potential of Private Sector contribution to economic activity in the country, the policy development must be fully participatory and transparent.

Corruption perpetuates the Survival of the Unfittest

It is our view as the Voice of Business Eswatini that the sooner we look into the issues of sustainability and development […]

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It is our view as the Voice of Business Eswatini that the sooner we look into the issues of sustainability and development, the better for all citizens and stakeholders of our beautiful Kingdom. As we promised in the previous edition, we would like to report back to you on the findings and discussions that ensued around the subject of corruption from the FSE&CC Anti-Corruption Seminar.

In this article we will delve into the presentation talking points and items that were brought up by the participants during the seminar. The objective we want to achieve here is to look inwards through a solemn introspection, embrace our realities, and ultimately internalise the lessons that we learnt from the seminar. We also want to look outside in the environment to identify issues that we need to address as a collective and investigate some of the approaches that could be used in the combat of the corruption pandemic. The fight against corruption is not going to be easy and it is not going to be won overnight. Some of the lessons are covered in the below discussions:

1. Everyone has a Role to Play (connect the lights to expose corruption)
The Afrobarometer survey revealed one of the insights that were shared by participants in the seminar – there is an aura of fear around exposing corruption in our communities. It was established that a shocking 82% of the respondents felt that they risk retaliation if they speak out against corruption. This minimises the inclusive nature of the solution to the issue because everyone has a role to play in the alleviation of the crisis. The doers of corruption thrive on this situation at the peril of all the victims who believe that the solution is out of their control. Everyone has a role to play by either desisting from enabling corruption or exposing corruption through the use of the anti-corruption structures.

2. Educate Society About Corruption
It has been established that in an environment where corruption has evolved and has been deeply engraved into the lifestyles and culture of society, it becomes difficult to demarcate the red flags. The systems in this situation become contaminated to an extent where “corrupt” and “not corrupt” becomes a hazy grey area. Like any other societal ill, the starting point is education around the subject in order to create awareness about the issue, its impact, and then – what mechanisms should be put in place to alleviate it. The Afrobarometer Round 7 survey in Eswatini had some insights which are consistent with the need for society to be educated about corruption. Out of the respondents interviewed, only 51% believed that corruption has somewhat increased between 2015 and 2018. A combination of respondents who believed that corruption levels stayed the same, decreased, and those who do not know of the status made up a total of 49%. This is stark evidence that there is a deficiency in the knowledge system of society to identify, expose, and prevent corruption because the reports that analyse the incidence of corruption reveal an upward trend on the ground. There has been a lack of activity in the redress of the pandemic, which would be in the form of cases being concluded and individuals being prosecuted for corruption. Therefore, it is conclusive that, the rising trend of corruption is occurring and going unnoticed by society. We are then suffering the consequences of it without even knowing that we are the victims of it. Education on the subject could help for society (all stakeholders) to appreciate that they are the losers in the presence of corruption.

3. Strengthen Anti-Corruption Mechanisms
The state of the anti-corruption structures is another issue that needs attention as the credibility, thereof, also determines whether citizens would have the confidence in them to an extent that they would actually consider to use them. If the confidence levels in the structures are low, they would simply be a formality. The corruption alleviation structures also play the critical role of providing protection for the individuals and institutions who utilise them. Protection of users should ideally go to then level where the users of the system feel motivated to use it because they feel it is to their benefit.

4. Anti-Corruption Efforts Should be Connected with Human Rights
Corruption was cited as an impediment to doing business, a major contributor to a weakened economy, skewed opportunities, compromised law enforcement processes, loss of development funds, poor and costly social services, and a host of other challenges. The lack of amends to corruption is tantamount to an infringement of basic human rights as it leads to the “survival of the unfittest”. A closer look at the United Nations sustainable development goals (SDG’s) shows that corruption is directly in conflict with such goals.

5. Pay now or Pay Later
As a way of closing in the seminar, another notable quote by the presenters was that in the end, the perpetrator of corruption will pay for the consequences. The advice given to those who practice corruption was that they have to pay now and desist from the practice, or they would have to pay later in many ways such as prosecution or/and losses caused by being used to a lifestyle of greed whose revenue would be unsustainable in the long run. Lives are lost through corruption when improperly built structures fail, below-standard goods are procured and the perpetrators have to face the brunt of the law.

We Advocate for a Corruption-free Eswatini

Corruption is one of the worst enemies of business because it can result in far-reaching consequences, including total closure of companies.[…]

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Corruption is one of the worst enemies of business because it can result in far-reaching consequences, including total closure of companies. Now, this renders an unwarranted situation in the hands of the business community and economy. As the Voice of Business, we condemn the presence of corruption of any form, shape, or magnitude. Corruption in business involves misappropriation of funds, bribery, misuse of office by company officials and dishonesty in financial matters. Its magnitude notwithstanding, corruption can hurt the image of the business and jeopardize its profitability.

Economies that are afflicted by a high level of corruption - which involves the misuse of power in the form of money or authority to achieve certain goals in illegal, dishonest or unfair ways—are not capable of prospering as fully as those with a low level of corruption. Corrupted economies are just not able to function properly because corruption prevents the natural laws of the economy from functioning freely. As a result, corruption in a nation's political and economic operations causes its entire society to suffer. If the country is perceived as corrupt, it is eluded by foreign direct investment opportunities. It does not end by losing out on FDI, it creates an element of unfair competition and stifles efforts to enforce compliance with standards and leads to poor quality services and products. According to the World Bank, the average income in countries with a high level of corruption is about a third of that of countries with a low level of corruption. Also, the infant mortality rate in such countries is about three times higher and the literacy rate is 25% lower. No country has been able to completely eliminate corruption, but studies show that the level of corruption in countries with emerging market economies is much higher than it is in developed countries.

His Majesty King Mswati III has laid down a vision for the nation, Vision 2022. One of the key problems that the country is to have conquered to achieve the goal is that of reducing the Corruption rate in our beautiful Kingdom, by so doing we will draw investors and funding who will trust that their resources are being properly used for the benefit of the country and also for business. As a nation there is a lot we can learn from our fellow countries Rwanda and Botswana. They have successfully fought Corruption by creating a zero tolerance to Corruption. Our country has done well to put the Anti-Corruption Commission (ACC) in place - but that is not enough to grind the results we need as our economy continues to slide back on corruption statistics. The awareness in relation to Corruption and its practices in the country has been communicated by the commission, however, to take the Kingdom of Eswatini further in achieving the vision of the His Majesty the King, there has to be robust action.

According to the results in the Anti-Corruption Commission Perception Survey, respondents believed that everyone can fight Corruption at a 72% level together with Anti-Corruption Commission, the public sector and the police at 26%, 15% and 13% respectively.

It is crystal clear that fighting Corruption rests on the shoulders of the whole nation. Surely if we rise up as a country to fight Corruption, the repel effect of this change would do well for the growth and sustainability of the economy of the Kingdom in the years to come. Recent findings have proven that Corruption is one of the biggest impediments to the ease of doing business. According to the World Economic Forum Global Competitiveness Index 2016-17, Corruption is the second-highest destructor to the ease of doing business in the country. Compared with neighboring South Africa, Swaziland was seven places worse off in the Corruption pillar. Swaziland has regressed in the propensity for corruption to a point where it is now the second-best impediment to the ease of doing business. This analysis is especially disconcerting because this scourge is within controllable factors, and therefore, is being perpetuated by our very own society.

Among the vast number of the most common effects of corruption on business, we cite the following:

Discouragement of Shareholders and Investors
Reports of corruption in a firm can cause shareholders and investors to lose trust and confidence in the business. Perpetuation of fraud boosts the entrepreneurs’ risk of accruing losses through a decline in sales and misuse of scarce resources among others. Corruption, either internal or external, can discourage potential innovators and entrepreneurs from investing in business opportunities for fear of failure. This leads to reduced prospects of business activity within the economy as investor confidence migrates to less corrupt economies.

Damaged Organisation Image
Corruption within an institution/firm can dent the image of the organization concerned. As customers and the general public get a negative picture of the company, they may lose trust in the company and its products. This may result in loss of clients and reputable business partners. It can take time for a business organization to rebuild its reputation and win people’s trust again, if ever.

Business Inefficiency
Because corruption entails improper use of the available resources, it can jeopardize the efficiency of a business organization. Resources that would be used in implementing important business operations are instead employed in unrelated or unproductive functions. Bribery in the process of awarding tenders and contracts may result in enlistment of incompetent contractors. In the process, business efficiency and productivity suffer. Inefficiency can also result from employees who are demoralized -- due to corruption in the business. Besides, fraud in the recruitment process may lead to hiring of incompetent employees who are unproductive in the firm.

Please join us next week as we share some of the highlights from the anti-corruption seminar that was hosted by the FSE&CC on the 29th June where there were speakers from the Construction Industry Council, Swaziland Public Procurement Regulatory Authority, Anti-Corruption Commission and former South African Public Protector, Advocate Thuli Madonsela.

The Finance Bill, 2018: A Business Perspective

On the 27th February 2018, the Honourable Minister of Finance gazetted the Finance Bill, 2018.[…]

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On the 27th February 2018, the Honourable Minister of Finance gazetted the Finance Bill, 2018. Since then, there have been many discussions on the expected impact of the Bill on the people of Eswatini. The object of the Bill is to impose and alter certain taxes, duties, levies, tolls and fees and to amend certain enactments of the same. There are many sections of society that are affected by the Bill, therefore the Voice of Business find it pertinent to highlight the concerns from a business perspective on the Bill.

From the outset, it must be stated that there is the concern that the Bill was promulgated, not to improve service delivery, but to contribute to the consolidated fund. If this is indeed the case, then such a Bill cannot be justified in any way, shape or form. A clear position on the objective could go a long way in persuading all constituents to contribute, especially if they value the collective benefit.

Policy Direction
What needs to be clear is what the Policy objectives that the Government is pursing are, that inform these changes. It is not sufficient to say these fees, levies and charges have not been reviewed in a long time. There has to be coherence with the National Policy objective of economic growth. For example, Part VIII of the bill; of the proposed changes in trading licence, together with the general principles guiding the issuance of certain licences, read together with Part IV of the Bill; the proposed amendments in the Company licences fees, does not suggest an encouragement for entrepreneurship. The net result is that it becomes costlier to open a business, particularly for the MSME sector and large businesses alike. This naturally begs for the question - what is the intended Policy objective here? Is it to create more businesses? Is it to make it easier to do business as a citizen of Eswatini?

It is also critical to point out that the promulgated increases could be construed as a double-taxation mechanism as it targets the same individuals who pay taxes as individuals and corporates. Worsening off the consumer reduces the viability of business by reducing their disposable income that could be spent on goods and services and thereby, ensuring sustainability of business.

Another example, Part II of the Bill, relating to stamp duties in particular fixed deposits wherein the duty proposed is E10 for any E200 or part thereof of the fixed amount and for every period of 12 months or thereof. It is expected that will discourage the culture of savings and prevent a barriers to financial inclusion on the part of MSMEs due to it becoming more expensive for the consumer. From the Banks’ perspective it limits their ability to issue credit due to the anticipated decreased deposit.

Example: 1 Million Deposit Earning 5.75% Interest

1 Million Fixed deposit earning 5.75% Current Scenario Proposed Scenario
Stamp Duty on fixed Deposit E200 E50 000
Interest Earned E57 500 E57 500
Total Consumer earnings E57 300 E7 500

A difference of E49 800!!! Of course, an argument can be made in the taxation of the income on savings, but certainly not on taxation of the savings themselves. These examples are only but a drop in the ocean on the final analysis of the impacts of the Bill. If the ease of doing business is not guaranteed and, even destroyed, business will crumble and with it, the whole economy. As United States Senator, Marco Rubio once said: “We don't need new taxes. We need new taxpayers, people that are gainfully employed, making money and paying into the tax system. And then we need a government that has the discipline to take that additional revenue and use it to pay down the debt and never grow it again.”

Consultative process
What is disconcerting the most to the private sector is the apparent lack of consultation on the Bill. There are a lot of negative implications on the ease of doing business and investor confidence that are borne out by? the proposed changes, and it would be expected such a raft of changes would go through a thorough consultation process to determine the impact on businesses. As it stands, doing business in the country is becoming tougher and tougher each day.

Since fees and duties are always politically determined to some extent, it is imperative from the beginning to provide an adequate process of consultation with affected groups and review by both the public and government agencies and departments.

As a rule, the only public voice to be heard when a policy changes is that of the beneficiaries of the previous policy, who are clear losers. It is important to set out clearly the parameters within which such changes should be made, including whom to consult and in what manner.

Even full compliance with these principles, however is not enough: a serious effort must also be made to persuade the affected groups that the pricing policy adopted is reasonable. That is, the policy must not only be reasonable, it must also be persuasively presented as reasonable to a group of people whose natural interests are opposed to it.

Detailed Study
One strategy that government should employ is to present a detailed convincing study of the expected distributional effects of increasing all these fees and duties on a case by case basis. If the effects are found not likely to be serious, the point should be demonstrated convincingly. If, however, they are indeed likely to be adverse effects, as it is widely expected in the Finance Bill, this should be admitted and the proposed policy changes be reviewed to mitigate such adverse effects. It is the position of the Voice of Business that the Finance Bill, 2018 in its current form is lacking in several aspects, and we believe that the Bill should be withdrawn and re-drafted to include the proposed consultation with all the relevant stakeholders.

Change Challenges to Business in Swaziland to Opportunities Eswatini

As the voice of Business in Eswatini, a country that has changed its name, we are hopeful that the name change will extend to a change in a lot of other things.[…]

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As the voice of Business in Eswatini, a country that has changed its name, we are hopeful that the name change will extend to a change in a lot of other things. Speaking on behalf and representing the private sector, we are dealing with numerous issues that affect business. Our role is not only limited to identifying barriers to doing business but we also provide a platform for solutions to be developed collectively as stakeholders. It is imperative that we discuss our mandate and highlight the messages we have for all our stakeholders. We have dedicated this article to, once again, recap on our business advocacy agenda. We are fully aware that an array of issues keeps cropping up as we move along with these, and we are responsive to them too. As indicated that they are not exhaustive, some of the challenges facing industry are indicated below as follows:

1. Slow economic growth, high levels of unemployment and fiscal challenges. A GDP growth rate of less than 3% per annum over the last five years is evidence enough that the economy of the country requires improved ideas to increase economic productivity and output, resulting in positive trade results, reduced budget deficit, trade deficit and unemployment rate (currently standing at over 40%). The latest fiscal approach was to increase taxes and user-fees. In a situation where it is already difficult to do business due to overregulation and expensive levies, there has been little dedicated to enablement of business in order to stimulate economic growth. Government still struggles to pay private sector companies in time, causing some of them to incur serious finance costs and risking going under. We certainly hope that this is recognised soon to avoid straining business any further and being a stumbling block to ourselves.

2. Skills/Policy Misalignment. There lacks correlation between the skills that industry requires and the skills available and produced by the country, especially for multi-national companies establishing business in Swaziland. It is important to note that business is essentially about profitability using the best of skills, thus the importance of the availability of the required skills. However, government has emphasized the need for ensuring localization of positions even for multi-national companies in most cases without due regard to the specific situation of the company, and whether the skills brought by expatriates already exist in Swaziland. Industry has indicated the need and interest in playing a role in skills development which will benefit industry and the country as a whole through increasing the number of employable Swazis. This includes structured skills transfer programmes such as internships, apprenticeship, sponsorships, scholarships and others. The challenge is that this is no longer appetizing to industry since government withdrew its tax incentive scheme that supported the training programme. Such programmes are viewed by industry as costly and not responsive to their profit-oriented approaches especially because trained staff can be easily poached by competition.

3. Slow legislative and policy reform processes. Whereas government’s policy and legislative review process, by design, requires the inclusion of all stakeholders and individuals, the processes often lack transparency and often leaves out crucial contributions by the private sector. Sometimes, such processes are seen to be used as a formality as opposed to genuine engagement for inclusivity. As a result, industry has indicated concerns with various pieces of legislation, some of which were validated, presumably with the private sector in attendance. For instance, the private sector was not extensively consulted in the development of the master plan which includes the energy policy. As a result, there is lack of clarity on the stance of government towards green energy and self-sufficiency in electricity generation. At the same time, business suffers from unreliable electricity supply and high electricity fees resulting in either reduced profits or increased prices transferred to consumers. The damage caused by inconsistent electricity supply to the health, manufacturing, poultry and other industries cannot be overemphasized. The absence of small claims court and commercial courts results in a backlog of cases involving business and as such makes the business environment not so conducive when it comes to speedy resolution of transactional issues, slowing down economic progress in the process. The executive government and parliamentary processes in drafting and amending legislation are slow and lengthy, stalling many business processes and economic development at the end of the day. Numerous bills and regulations for Acts of Parliament await finalization, a number of which directly affect the private sector including the Public Health Bill, Pharmacy Bill, Sectional Title Bill, to name but a few.

4. Increasing levels of corruption. Former Minister for Finance indicated that the country loses millions of Emalangeni per month through corruption and such corruption was observed mostly on the procurement front. While the Swaziland Public Procurement Agency was established to ‘straighten’ the procurement processes in the country, corruption transcends beyond procurement systems to ethics, culture and systems. The Anti-Corruption Commission (ACC), which works to combat corruption in the country, seems to be handicapped when it comes to sufficiency of resources to carry out its work. This is primarily reflective in staffing of the ACC. Secondly, there seems to be challenges with the architecture of the legislation that establishes the ACC, making the agency to be ‘toothless’ in most cases. The FSE&CC developed and introduced the Code of Good Governance for business in Swaziland. It is adherence to this Code that requires monitoring if anything is to change regarding the corruption space.

5. Lack of incentives for business to thrive. Challenges faced by industry include lack of sufficient support for micro, small, and medium enterprises (SMMEs) yet these are known to be crucial for overall economic growth, providing support services and goods to big business. SMMES have been faced with lack of access to finance particularly where financial institutions apply what has been observed to be unreasonably stringent requirements for SMMEs to access finance and viewing SMMEs as risky and penalizing them for that. The tax regime is geared towards collecting every cent in a situation where the government is not honouring its obligation to pay its suppliers within agreed or reasonable timeframes. This has a crippling effect on small business, even big business in some cases. The cost of utilities, in particular, water, electricity and telephone are high, making business less profitable at the end of the day. The country’s reliance on importing electricity from the Republic of South Africa results in the importation of large electricity tariff increases which have been observed over the years in South Africa. Lack of competition and proper regulation and consumerism for the providers of utilities disadvantages industry as these are good ingredients to poor service delivery and lack of efficiency, often reflecting in unnecessarily and unreasonably high costs of services.

Social Protection - ‘YINDZABA YETFU SONKHE’ (PART I)

The History of Social Protection Social Protection is one of the four (4) strategic objectives of the International Labour Standards (ILO) Decent Work Agenda.[…]

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The History of Social Protection Social Protection is one of the four (4) strategic objectives of the International Labour Standards (ILO) Decent Work Agenda. According to the ILO, ‘Decent Work’ “sums up the aspirations of people in their working lives. It involves opportunities for work that is productive and delivers a fair income, security in the workplace and social protection for families, better prospects for personal development and social integration, freedom for people to express their concerns, organize and participate in the decisions that affect their lives and equality of opportunity and treatment for all women and men.” The strategic objective of Social Protection is to enhance the coverage and effectiveness for social protection for all. Under the ILO, Social Protection covers the following thematic components: (a) Social Security; (b) Safety and Health at Work; (c) Working Conditions; (d) International Labour Migration; and (e) HIV/AIDS.

Social Protection is important because it is a human right as declared by the United Nations Declaration on Human Rights (UNDHR) 1948, Declaration of Philadelphia 1944, ILO Standards, national Constitutions, and other international frameworks.

As highlighted, one of the thematic areas of the ILO Decent Work Agenda is Social Security. Since its foundation in 1919 and up to the year 2012, the ILO has adopted 31 Conventions and 23 Recommendations on social security issues. The ILO Convention No. 102, Social Security (Minimum Standards) Convention, 1952 sets the agreed minimum standards which pertain to social protection at an international level. This Convention is considered as a ‘flagship social security instrument’ and serves as a guide when establishing social security frameworks.

According to the ILO, “Social Security” is ‘the protection that a society provides to individuals and households to ensure access to health care and to guarantee income security, particularly in cases of old age, unemployment, sickness, invalidity, work injury, maternity or loss of a breadwinner’.

Convention 102 establishes social security principles on nine pillars or branches, namely:

  • Medical Care – the provision of contingencies for conditions requiring medical care of a preventative or curative nature and includes any morbid condition, pregnancy and confinement and their consequences;
  • Sickness Benefit – the provision of sickness benefits for workers who are incapable of working due to ill health;
  • Unemployment Benefit – the provision of contingencies to cover the suspension of earnings due to the inability to obtain suitable employment to persons who are capable of and available for work.
  • Old – Age Benefit – the provision of contingencies for survival beyond a prescribed age.
  • Employment Injury Benefit – the provision of contingencies where due to accident or prescribed disease resulting from employment result in a morbid condition, incapacity to work, loss of earnings or loss of support.
  • Family Benefit – the provision of contingency for the maintenance of children.
  • Maternity Benefit – the provision of contingencies during pregnancy, confinement, suspension of earnings and the consequences flowing therefrom.
  • Invalidity Benefit – the provision of contingencies for the inability to engage in any gainful activity, which ability may be permanent or persists after exhaustion of sickness benefit.
  • Survivor’s Benefit – the provision of contingencies for loss of support suffered by widow or children as a result of the death of a breadwinner.
The Social Security Landscape in Swaziland It is worth noting that Swaziland, being a Member – State of the ILO has not ratified Convention 102, which is the principle Convention on Social Security, but She has ratified various other Conventions which have an impact on social security such as C019 – Equality of Treatment (Accidental Compensation) Convention, 1925 (No. 19) which was ratified on the 26th April 1978. Convention 19 sets the principles for the equality of treatment for national and foreign workers as regards workmen's compensation for accidents. Upon ratification, Swaziland enacted the Workmen’s Compensation Act No. 7 of 1983 which fulfils the Unemployment Injury Benefit branch of social security.

While Swaziland has not ratified Convention 102, this does not mean that the country does not provide for social security measures in that there are various legislation and programs dedicated to this. For example, the Employment Act No. 5 of 1980 (as amended) provides for maternity and sickness benefits where workers enjoy full protection of the law. The Wages Act No. 16 of 1964 which empowers the Minister responsible for Labour to promulgate Wages Regulations for regulated industries. Through this subordinate legislation, sickness benefits and varying provisions for paid maternity leave on average 30 days full pay are contained in the Regulations, while many industries which are not regulated offer full pay, that is, three months, to workers who take maternity leave.

In terms of the stated legislation, the obligation of paying for employment injury, sickness and maternity benefits is solely on the employer. This literally it means that the employer is, forced by law, to pay/compensate workers for services which they have not rendered during the period of sickness and maternity leave where they are booked off; or to compensate workers for injuries sustained, diseases contracted or deaths which result during the course of employment of their workers, even where such worker have been negligent. Under the current dispensation, employers are disadvantaged by being the only party who bears the obligation of paying towards the stated contingencies, with no contribution required from workers.

In the next article we shall continue highlighting the social protection landscape in Swaziland, looking at Contributory and Non – Contributory Schemes, and examining whether these are sufficient to constitute social security as contemplated by Convention 102.

Comments to this article may be sent to This article was prepared by the Federation of Swaziland Employers and Chamber of Commerce.

Trade Policy and Regional Integration

Most businesses are not as informed on what is happening in the area of trade policy and regional integration.[…]

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Most businesses are not as informed on what is happening in the area of trade policy and regional integration. The reason is that businesses for the most part, don’t participate in discussions around trade policy and regional integration yet in the era of globalization the participation of business in these discussions has become increasingly important.

There are three main reasons why businesses don’t participate as much in discussions on trade policy and regional integration. Firstly, they are not provided with information on what is obtaining on the ground in terms of regional integration, and what it means for their businesses. Secondly, in the event that business people are provided with such information, they get turned off by the jargon often used by trade policy technocrats in discussing issues of trade policy and regional integration. Lastly, the discussions around regional integration take too long such that businesses get discouraged and stop following what’s obtaining and instead focus on adding value to their businesses.

The case for business participation
There are two main reasons why businesses need to participate more in discussions around trade policy and regional integrations.

Firstly, trade policy and regional integration discussions are anchored on negotiations that require input from businesses as they are the traders, merchants, importers, exporters etc. During the negotiations, each country (sometimes a block of countries) specifies its priority sectors for the regional integration process by indicating the sectors of the economy that it would like to completely open up to competition from other countries (offensive sectors) and also those sectors that it would like to ‘protect’ for its own businesses.

Since these negotiations are mostly done by technocrats, guidance is therefore required from the people on the ground (business) on the business opportunities they see in other countries and also on sectors of the economy which they think still need to be competitive internally before they are completely opened up to foreign competition.

The second reason why businesses need to participate in the regional integration agenda has already been implied on the point above: regional integration increases business opportunities for companies in specific countries as barriers to doing business across borders and regional economic communities like SADC and COMESA are reduced. In other words, the market for a business in Eswatini suddenly becomes bigger with regional integration. This is particularly significant for businesses operating in small countries like Eswatini where the market size is small.

How business can participate
In Eswatini, there is the Trade Negotiation Forum, a platform where government and business are meant to discuss issues of trade policy and regional integration. In this platform, businesses who want to participate need to do it via business associations like the FSE&CC and FESBC. However, such a forum has its limitations, logistically and also in terms of effective participation of a diverse group of businesses. For that reason, workshops are there to complement such a forum by allowing businesses to learn and voice out their input into trade related issues.

From time to time, the International Trade Department, under the Ministry of Commerce, Industry and Trade, hosts workshops on trade related issues and regional integration. The Swaziland Revenue Authority (SRA) also, has a role of Trade Facilitation, over and above Revenue collection. However, the attendance at such forums tends to be less than stellar. To complement the work of the Ministry, business organizations have a role to play in sensitizing their constituents on what is obtaining on the ground in terms of regional integration, and how businesses can participate.

For example, on the 21st March 2018, during the extraordinary Session of the Assembly on African Continental Free Trade Area (AfCFTA), the country was among 44 signatories to the framework that will establish the agreement. It is worth noting the country signed the consolidated text of the AFCTA and is not yet a signatory to the Free Movement Protocol (signifying the free movement of people, right of residence and right of establishment.)

During the summit it was agreed that the AfCFTA will come into effect within 18 months. For this to occur, at least 22 countries must ratify the agreement formally. Some countries, such as South Africa (which has yet to sign on but is considering it), say the time frame may be too short, especially given the need for debate and negotiations within each signatory nation. Countries still have to complete negotiations on competition, dispute-resolution mechanisms, intellectual property rights and investments, among other issues. They should also agree on regulatory frameworks for service-trade liberalization (to facilitate market access), submit tariff concessions schedules for trade in goods (specifying the timeline and nature of products that will be liberalized). Sectors or industries that have an interest in expanding the market into the broader continent, should therefore take this opportunity to become involved in the negotiations.

In conclusion
The importance of trade and regional integration to businesses based in small market economies like Eswatini cannot be over-emphasized. The participation by businesses in the process leading up to regional integration is crucial if businesses are to take advantage of opportunities arising from regional integration. The Voice of Business encourages business to actively participate in trade discussions. The Government of the kingdom of Eswatini is also further encouraged expand the dialogue platform that will allow the private sector to be widely heard. The responsibility of creating a business friendly environment falls to all Government Ministries and agencies to work side by side with the Private Sector.

The World Economic Forum

The World Economic Forum in partnership with the Federation of Swaziland Employers & Chamber of Commerce (FSE&CC) is in the process […]

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The World Economic Forum in partnership with the Federation of Swaziland Employers & Chamber of Commerce (FSE&CC) is in the process of conducting the Executive Opinion Survey 2018 in Swaziland which began on the 1st January 2018.

The Executive Opinion Survey, “The Voice of the Business Community” is a major component of The Global Competitiveness Report and provides the key ingredient that turns the Report into a representative annual measure of a nation’s economic environment and its ability to achieve sustained growth. The Survey gathers valuable information on a broad range of variables for which hard data sources are scarce or nonexistent. High level business executives operating in Swaziland will be surveyed to capture their opinion on the business environment in which they operate.

The Global Competitiveness Report has been the World Economic Forum’s flagship publication since 1979 and is widely recognized as the world’s leading cross-country comparison of factors affecting economic competitiveness and growth.

For the first time in 2010, Swaziland participated in the World Economic Forum Global Competitiveness Report. The Federation of Swaziland Employers & Chamber of Commerce (FSE&CC) is a Partner Institute to the World Economic Forum (WEF). As a Partner Institute, FSE & CC administers the Executive Opinion Survey in Swaziland, which is used in the Global Competitiveness Report to calculate the country’s GCI.

The goal of the report is to provide a benchmarking tool for business leaders and policy makers to identify obstacles to improved competitiveness, thus stimulating discussion on the best strategies and policies for overcoming them.

Economic Competitiveness is a political-economic concept that emerged in trade and policy discussions in the last decades of the 20th century. Competitiveness theory posits that while protectionist measures may provide short-term remedies to economic problems caused by imports, firms and nations must adapt their production processes in the long term to produce the best products at the lowest price. In this way, even without protectionism, their manufactured goods are able to compete successfully against foreign products both in domestic markets and in foreign markets. Competitiveness emphasizes the use of comparative advantage to decrease trade deficits by exporting larger quantities of goods that a particular nation excels at producing, while simultaneously importing minimal amounts of goods that are relatively difficult or expensive to manufacture.

Trade Policy can be used to establish unilaterally and multilaterally negotiated rule of law agreements protecting fair and open global markets. While trade policy is important to the economic success of nations, competitiveness embodies the need to address all aspects affecting the production of goods that will be successful in the global market, including but not limited to managerial decision making, labor, capital, and transportation costs, reinvestment decisions, the acquisition and availability of human capital, export promotion and financing, and increasing labor productivity.

Competitiveness results from a comprehensive policy that both maintains a favorable global trading environment for producers and domestically encourages firms to work for lower production costs while increasing the quality of output so that they are able to capitalize on favorable trading environments. These incentives include export promotion efforts and export financing—including financing programs that allow small and medium-sized companies to finance the capital costs of exporting goods.

Last year, over 16, 000 business leaders were polled in a record of 137 economies. The survey is designed to capture a broad range of factors affecting an economy’s business climate. The results show that while competitiveness in advanced economies has stagnated over the past seven (7) years, in many emerging markets it has improved, placing their growth on a more stable footing and mirroring the shift in economic activity from the advanced to emerging economies.

The edition highlights that declining openness is threatening growth and prosperity. It also highlights that monetary stimulus measures such as quantitative easing are not enough to sustain growth and must be accompanied by competitiveness reforms. Final key finding points to the fact that updated business practices and investment in innovation are now as important as infrastructure, skills and efficient markets. Declining openness in the global economy is harming competitiveness and making it harder for leaders to drive sustainable, inclusive growth

In the 2017-2018 edition Swaziland was ranked 122nd which was an improvement from 128 out of 140 countries in 2015-2016. The survey is still ongoing for 2018 and members of the business community are kindly urged to take part in this very important exercise. The questionnaire is to be filled in by any person in the top 3 management positions.

Empowering the Economy

As the economy changes for the worst, we need to increase the impetus and the number of platforms on which issues are discussed with a view to […]

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As the economy changes for the worst, we need to increase the impetus and the number of platforms on which issues are discussed with a view to getting all stakeholders to work towards the development of our beloved country’s economy. In this edition we will discuss some of the means we are engaging to empower women and to get the voice of business out for all to hear.

Business Eswatini recently had a new chairperson for the Business Women Forum of Swaziland (BWFS), Ms. Sindisile Horton. She is the sales and Marketing manager for Total Swaziland. The BWFS is a membership-based organization, representing women-owned businesses and entrepreneurs. The organisation was established is 2006, through funding from the International Labour Organisation and United Nations Development Program.

To Empower Women Entrepreneurs
The vision is to be the leading organization that fosters the development and economic empowerment of women in Swaziland with the mission to facilitate and advocate for an enabling environment for sustainable entrepreneurship of women in Swaziland through the coordination of capacity building programmes, the integration of young women into the business environment and dissemination of business related information and provision of mentorship programmes for existing and aspiring business women. The BWFS has since been operating under the umbrella of the FSE & CC, which has been responsible for administration, implementation of programs and overseeing of the operations of the Forum. The forum is membership based; hence any women in business who is interested may join.

The forum has since introduced meetings at Mountain Inn, which will take place every first Tuesday of the month where issues relevant to business women in the country are discussed. Some of the meetings that were convened since then, include an in-depth presentation by Swaziland Revenue Authority (SRA) where the VRA Sekulula System was unpacked. Some of the areas of discussion included the legislative framework and principles of VAT, and procedural requirements for compliance.

The commemoration of International World Women’s’ Day was themed “Leave no Women Behind”. This is clear indication that there is a global drive to empower women. The theme ensures that there is active participation and positive strides towards equitable attainment of gender equality in social, political and economic dimensions. This also touched on the upcoming elections where women are encouraged to participate and be represented, not only in the economic space, but also in the political sphere.

The Transport Indaba
One of the issues we are advocating for as the voice of business includes the 24-hour operation of our border posts who are a gateway for the flow of goods into and out of the country. We are looking at the necessary gaps that need to be addressed in order for the economy to thrive. This is our mandate. We recently identified and had an Information Technology and Communication (ICT) Workshop where some of the issues that affect local industry were put on the table for discussion. ICT was flagged as one of the areas that would, if leveraged on, give an impetus to our economic empowerment. This is one of the modes we engage to give these issues a platform.

The FSE&CC also views the transport sector as a critical sector to the economy since it enables the movement of goods and services in and out of the country easily. In Africa, Swaziland included according to the World Bank, the cost of transporting goods is the highest in the word. This then places a significant burden on the development of many African economies. PwC, in a recent report titled ‘Africa Gearing Up ‘, urges that whether moving resources off the continent or bringing goods and services into its economies, Africa’s future growth and development will depend on the quality of its infrastructure and efficiency of its transport networks. The report continues to note that, currently around just 11% of the continent’s trade is with other African traders, the firm attributes this to infrastructure barriers to trade, and trade agreement should be an imperative.

Swaziland is one of the 15 land locked developing countries (LLDC’s) in Africa. As a landlocked country, Swaziland is facing impediments in trade facilitation. Due to their remoteness, landlocked countries are dependent on neighbouring countries transit countries for their external trade and suffer from high trade transaction costs. Huge transport costs, inadequate infrastructure and bottlenecks associated with importation and exportation requirements can be a serious stumbling block to their integration into the global economy, impairing export competitiveness or the inflow of foreign investment.

According to the World Bank (1999), LLDC’s pay around 50 percent more in transport costs than coastal countries and have up to 60 percent lower volumes of trade. Inefficient customs and transit procedures are considered to be the main cause of delays and high transport costs and represent a greater obstacle to trade for LLDC’s than tariffs. As a result of LLDC’s marginalisation in global trade, the amount contributed by LLDC’s to developing countries’ share of global exports has exhibited a consistent decline.

Because of these trade reasons, the transport sector in any economy cannot be neglected, and thus engagement and development in the transport sector should be from both the public and the public sector. With the brief over-view, the FSE&CC will host another the Second Transport Indaba on the 12th April which will cover topics including regulatory and legislative affairs, Swaziland Customs Modernization Initiatives, and The Impact of the growing demand for vehicles in Swaziland. The topics will be presented by SRA, The Honourable Minister for Transport and Public Works and Municipalities of Matsapha, Manzini and Mbabane. All stakeholders are encouraged to attend these events to give added life to the voice of business.

Glaring Gaps in Swaziland's Strike Laws

The recent strike at Nedbank Swaziland resulted in two court cases which went on to reveal the glaring deficiencies in our labour laws […]

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The recent strike at Nedbank Swaziland resulted in two court cases which went on to reveal the glaring deficiencies in our labour laws and the manner in which they are interpreted by the courts. The first case, was instituted in August 2017 by Nedbank against the Swaziland Union of Financial Institutions and Affiliated Workers (SUFIAW) after the latter had invited its members in other financial institutions to join the strike as a means of showing solidarity and sympathy to their striking colleagues. In that case, the Industrial Court ruled that sympathy strikes are not provided for in Swaziland and they are therefore illegal.

Before the abovementioned case was concluded, SUFIAW brought an application to interdict Nedbank from using replacement labour during the strike. The Industrial Court declared that the use of replacement labour was contrary to the right to strike and to ILO Conventions. Nedbank appealed this decision and the Federation of Swaziland Employers & Chamber of Commerce (FSE&CC) joined in the appeal as the 2nd Appellant. The grounds of appeal on the part of the FSE&CC were;

  1. There is no right strike contemplated in the Swazi Constitution nor in the Industrial Relations Act, 2000. A strike is not a right but a dispute resolution mechanism that is provided for in the Act. In Swaziland, it is a constitutional nor a legal right but it is merely a recognized and protected activity.
  2. Though Swaziland has ratified ILO Convention 98 on right to Organise and Collective Bargaining, this Convention does not make any mention of any right to strike throughout its entire text.
  3. At the ILO, the Employers group has since 2012, been challenging the position that there is a fundamental right to strike and this dispute has not been conclusively resolved by the ILO Governing Body.
  4. The ILO Constitution provides that, each country must decide on how it shall domesticate an ILO Convention to suite local developmental stages and cultural differences. Indeed, there are significant variations on how different countries treat the issue of replacement and minimum labour.
  5. In this regard, the Judge has unilaterally usurped the powers of the LAB and of Parliament, which are institutions charged with the domestication of ILO Conventions.

The Industrial Court of Appeal set aside the judgment of the Court a quo. On the question on whether, an employer has a right to use temporary replacement labour, the Court held that;
  1. It is incorrect that the Industrial Relations Act, 2000 (IRA) is silent on the protections of an ongoing strike. The protection is a matter of degree and policy and as such, employers may not displace striking workers by hiring new employees.
  2. The Act neither prohibits nor restricts the use of temporary replacement labour and that the question is open and unregulated.
  3. The Act prohibits the permanent replacement of striking employees who participate in a lawful or protected strike.

On the question on whether, the use of temporary labour during a strike action infringes the right of workers to a protected strike action, the Court held that;
  1. Section 32 (2) of the Constitution (which provides for worker rights, including the right to collective bargaining) does not specifically include the right to strike as a constitutionally justiciable right or fundamental right. Unlike the South African Constitution which specifically guarantees the right to strike as a fundamental right.
  2. Equally the IRA is silent on the use of replacement labour as an infringement of the employees’ right to organise or engage in a lawful strike.
  3. On the effect of Convention 87 (on the Freedom of Association and the Right to Organise) on the right to strike, it was observed that there is no obligation on member states to incorporate and guarantee the right to strike within their national laws.
  4. The Court a quo erroneously found that the principles of the Committee of Experts on the Application of Conventions and Recommendations (CEACR) have a legal and binding effect on local Courts.

In both cases, the arguments by the respective parties, acknowledged that there were no specific provisions in our local laws that specifically addressed the issues brought to the court’s attention. The courts were then left with the challenge of how to deal with these grey area issues in the absence of any clear laws in Swaziland. The reliance of the courts on international conventions for guidance in such circumstances, only exposed them to the uneven terrain of the international labour landscape. A recent survey on strike action by the International Organization of Employer’s (IOE) published in December 2017, titled the Findings of the IOE Member Country Survey on Strike Action, revealed that, whereas ILO member states ascribed to the principles contained in the international conventions, the domestication of these found varying expression in national laws.

The survey showed high levels of inconsistency between national regulations on the right to strike and the non-binding opinions of the. This demonstrates that if a “universal” standard on strike action were to be established, current interpretations expressed by the CEACR do not provide a model that can be applied to all national contexts. The results revealed many interesting nuances between the extremes of detailed regulation and the total absence of rules.

These differences in the national expression of international conventions, only show that each country must choose and beat its own path, informed by its own socio-economic realities. In this regard, the Labour Advisory Board and the Parliament, must rise to the occasion and begin to lead the conversation of filling up the many gaps that characterize on labour laws in Swaziland. This will relieve the courts of the dilemma of having to make law when their duties are only to interpret them in the context of the disputes brought before them.

Our Hope for a Resurgent Economy

Compliments to all members of the business community and all stakeholders with whom we collaborate to ensure […]

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Compliments to all members of the business community and all stakeholders with whom we collaborate to ensure that this country is the best place for business in the region and continent. We are humbled to get the opportunity to use this massive platform to address policy matters from which the business community benefits.

A New Year
Exactly six days ago we were celebrating and welcoming a new year, a new year we literally believe brings new hope, new energy, new plans and resolutions to churn new life into the economy of our beloved country. During the previous year we discovered that our economy is volatile, thus a lot of events took place, many of which warrant diligent redress from all stakeholders with a view of getting the best outcome for the economy to move forward. We stand firm on the ground to look for better opportunities for development on behalf of our members and we are hoping for a year of increased productivity and a massive resurgence in our economy.

Before we delve into issues at hand let us start by reiterating our mandate for the benefit of parties who do not know what we are about and for you, dear reader, to fully appreciate and contextualize content. The FSE&CC is the main voice of the private sector in Swaziland. We protect the economic interests of the business community through continuous advocacy, engagement and dialogue on legislative and policy issues. This having being said, it has to be expected that we act as a conduit for cooperation between business and Government to help remove barriers to trade both locally and internationally. We also speak independently for the whole business community on issues of policy and public interest to live true to our slogan of being “the voice of business in Swaziland”. All our efforts are geared towards creating a conducive business environment in Swaziland. A conducive business environment rewards the economy as a whole by enabling business activity within the country which is an attractive scene for foreign investment that would lead to competency on the international markets.

In this column, for which we are deeply grateful, we seek to discuss topical issues that border on trade and commerce, industrial relations and social policy. By doing so, we aim to impact on the behavior of all stakeholders within the economy. We seek to spark meaningful and positive change and the establishment of platforms to address all matters affecting business in order to achieve a vibrant economy that rewards all who participate in it.

On the 17th November, 2017, The FSE&CC in collaboration with The Ministry of Commerce, Industry and Trade and International Labour Organisation (ILO) launched a business advocacy agenda. The advocacy agenda highlights some of the issues that we have to address as the country in order to achieve the vibrant economy we strive for. These range from slow legislative and policy reform, misalignment of skills between training institutions and industry, slow legislative/ policy reforms, high levels of corruption, and shortage of incentives for businesses. We will be discussing and sharing these issues from different angles as the weeks go by. Everyone has a role to play in order for the agenda to see fruition.

AGOA is Back
We begin this year in high spirits due to the good news we received towards the end of December, 2017. AGOA is back! We would like to thank all stakeholders, especially Government for working tirelessly to ensure that we regain AGOA eligibility. This is literally a new lease of life which will inject life into our deteriorating economy through a positive balance of trade, Foreign Direct Investment, Employment, and essentially - a better standard of living for all Swazis.

Two-way trade between Swaziland and the United States of America suffered a big blow as a result of the loss of AGOA. During the 2004-05 fiscal year bilateral trade was at about 200 million Emalangeni with a balance of trade of +180 million Emalangeni. The same took a massive hit to alarming levels where balance of trade was at about -10 million during the 2016 fiscal year.

(picture sourced from AGOA Website:

We need to act swiftly to make our country as welcoming and as conducive as possible for this to yield the most needed boost in the short term. It is the responsibility of all stakeholders to ensure that this happens as a matter of urgency. Increased local industrialization is one way by which the dependence on SACU revenue and tax revenue would be minimized. It is, therefore, in the best interests of all Swazi citizens to embrace this achievement on every possible platform to make the desired economic resurgence a reality. Again, the advocacy agenda cited above speaks volumes to put the country on the map since we need to improve relevant skills within our institutions in order to tap into the opportunities offered by AGOA. Our policies have to be dynamic so as to allow impervious international trade while offering incentives to local businesses. Also, corruption has to be addressed in order to attract more Foreign Direct Investment for an economy in resurgence.

According to the World Economic Forum Swaziland is becoming less attractive to FDI because of a number of factors. Please join us next week for a full discussion on this issue.

We Labour in Vain

Industrial action is one of the democratic rights for every employee in a free society and economy.[…]

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Industrial action is one of the democratic rights for every employee in a free society and economy. It is a constitutional right, and one that is enshrined in labour laws globally. There are several reasons why industrial action is chosen as a solution to challenges faced by employees in any economy. It is usually a choice of last resort when all other avenues have been exhausted. This is a topic which could be discussed at length another time. But for purposes of this article, we will get to the crux of the matter – the burning issue at hand. Let us address these three questions.

Now that there is a legal strike by SRAWU (Swaziland Revenue authority Workers Union), who benefits from the consequences? Are there any winners in this situation? And if there are any, who wins?

We will dissect these questions from various aspects.

1. Budget deficit
We have reached a point where we would like for this information to be accessible only to patriotic local citizens who want to see meaningful positive change for the prevalence of a conducive business climate in the country. This is because the Swazi Government is spending more than she is generating income (deficit). As a result, the Government is in a fiscal crisis to a point that some would even contemplate it safer to have a private company owe you than our government. During the mid-year budget review speech, the honourable Minister of finance pointed out that the country is in a deficit of 8.1% of GDP which could escalate to 10.1% by the end of the financial year. Again, it is noteworthy that this was a situation predicted from an expected positive revenue collection stand-point. If the contrary is happening on the ground the country loses in the midst of the grave consequences, and no one wins.

2. Investor Confidence
A strike action by an entity which (embarrassing to say) is the heartbeat of government’s coffers, paints a grave image of the country’s ability to turn the corner in the struggle to win the confidence of foreign investment. Slow policy reforms, skills mis-alignment, lack of adequate incentives for business, and corruption (which were noted by the IMF report on Swaziland) add salt to the gaping wound experienced by our frail economy in a time when other countries are gaining strength E.g. Mozambique. Swaziland is a land-locked country that should be grateful for the investment they have from current FDI. Current and prospective investor confidence is being eliminated rapidly and if this situation persists, there will be more defections than gains in terms of FDI. Again, the economy loses, everyone loses and no one wins. Even if the striking workers were to get their demands granted, they would bear the consequences of a severe inflation and indirect costs caused by unemployment of their relatives and deteriorating ability by the state to fund social services.

3. SACU Revenue Dependence
We are overly dependent on SACU receipts, which is a cause for concern as the region is moving towards a direction where levies are relaxed by the formation of regional blocs - a strategy to stimulate trade between member states.

In his budget speech, the honourable Minister of Finance, Mr Martin Dlamini stated that a part of Government’s strategy to reduce dependence on SACU receipts is the establishment of Special Economic Zones (SEZs) to help stimulate growth, increase employment opportunities and reduce poverty. Industrialization efforts will be futile without creating an enabling environment for trade. He reiterated also that government has gone the extra mile to make sure that local products have a market in the region and worldwide. Again, if nothing goes across the borders of this country, the country and all who live in it suffer, the country loses in the form of a negative balance of payments and, ultimately, no one wins!

4. Balance of trade
Swaziland’s trade is highly dependent on South Africa (80 percent of total imports and 60 percent of exports). We are a net importer of food, fuel and machinery. As such, we are experiencing a negative balance of trade, which means we have to strive all the more to find a favourable balance between imports and exports. Stimulating local business is the only means towards achieving this balance. Therefore, in the prevailing situation the economy is held ransom to the detriment of local trade. This, again, leads to a state of economic malnutrition leading to a dire crisis where no one wins.

5. Limited consumer goods choice, Spoilage of perishable commodities, Transport business turnaround times, Tourism and Business risk.
All these factors combined paint a gloomy picture of what is the hope of the country in the short and medium term. The FSE&CC and the whole business community bemoan this situation and continue to plead to all stakeholders to exercise sincere patriotic recourse on behalf of all parties affected, especially businesses who have to honour all their financial obligations in a hostile environment. The loss of business at such a critical time will NOT be compensated. Instead, pressure mounts in terms of levies and overheads that are growing disproportionately without recompense. We urge government to spring to the rescue of this beloved economy that is bleeding its last drops as we downgrade. We have stated our position as the business community to ask the Ministry of Labour and Social Security, Ministry of Commerce, Industry and Trade and Ministry of Finance to intervene in this as a matter of urgency. There are no winners here - only losers.

We would have loved to wish our members, the business community, and the whole nation a happy festive season but we are, unfortunately, aware of the irreparable losses they are experiencing. Some have even been forced to reschedule delivery schedules, downsize production capacity, and even close down core business areas as a result of this situation. We stand in solidarity with all affected businesses in these tough times.

Youth unemployment: what can we do in the short run?

Youth unemployment remains one of the most vexing problems facing Swaziland. Numerous ideas, models and policy initiatives have been proposed and/or tried out but in vain. […]

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Youth unemployment remains one of the most vexing problems facing Swaziland. Numerous ideas, models and policy initiatives have been proposed and/or tried out but in vain.

The country adopted its first National Youth Policy in 2009, ratified the African Youth Charter in 2013 and has developed public policies in areas such as education and training (2010), gender (2010), disability (2013), and sexual and reproductive health (2013). In the same period, Swaziland has adopted a number of international frameworks, and worked with international organisations to develop programmes that seek to improve the lives of young people. Yet the problem persists. Swazi nationals and other observers look up to Government to create a conducive environment for the private-sector to create employment, not only for the youth but also for other age groups.

The question arises as to whether the policies that are developed and the institutions that are set can adequately help to address the situation.

The International Labour Organization has warned of a ‘scarred generation of young people’ who are failing to engage in meaningful development as they sit idle, neither employed, studying nor seeking work. This is especially concerning in Swaziland where as per statistics obtained from the Ministry of Labour and Social Security, broadly-defined unemployment amongst 15 to 24 year-olds is estimated at slightly more than 50 percent. The data demonstrates that young people, particularly in rural areas, are disproportionately affected by the challenge of unemployment, and the gap appears to be widening. Given that relatively few jobs are available in rural areas, looking for a job implies travelling to other areas, specifically to urban areas to seek employment opportunities. For someone unemployed, this can be very expensive, so many young people cannot afford to look for employment. For this reason, the income of the poor rural households where these unemployed young people live comes under scrutiny. Since social grants are a key source of income in such poor households, the following, perhaps surprising, question arises: what role could, or do, social grants play in alleviating this problem? Even though the social-grants system is based on other considerations, could its impact on household income possibly extend benefits to work-seeking youths?

More than half of Swazi young people aged 15-24 live in households with a per capita monthly income of less than E600 (the ‘upper bound poverty line’). Many lack access to information as they are unable to afford the high costs of data for the use of mobile phones, or the fees at the Internet cafés that would allow them to search for job opportunities or for application details. Further, unlike their middle-class peers, poorer young people lack ‘productive social capital’, that is, social networks that can be used for information about and access to the labour market. These are important for navigating their entry into the labour market.

Why are we not making progress? A multifaceted challenge
Why is youth unemployment in Swaziland such a seemingly intractable problem? The evidence suggests that it is a multifaceted problem driven by structural elements related to the labour market and the education system, as well as community, household and individual level issues. To understand the youth unemployment challenge better, there is need to consider what is happening at all of these levels. A composite picture of the issue may point in the direction of deliberate policy interventions which aim to adequately prepare those seeking employment to enter the job market. Where this has been applied, the result has been a higher absorption of skilled workers into the labour market. According to the 2013 Labour Survey Report, less than 50 000 Swazis have been to university, and this has contributed immensely to the high youth unemployment rate that Swaziland is currently experiencing.

The youth unemployment challenge may also be largely attributed to the evolving nature of the labour market and mismatches within the education system. Research findings indicate that a key difficulty facing young job seekers in particular is the fact that Swaziland’s labour market favours old employees. The country’s Labour Survey Report asserts that young university graduates applying for the same job with graduates who exited the institute of higher learning at an earlier date are 70 percent less likely to be successful in securing the same job.

The Voice of Business and its members are of the view that the policies and investments in education are not producing the desired skills outcomes. Employers continue to indicate that skills deficit is a major challenge to youth employment in Swaziland. The Voice of Business calls for a review of the education budget to ensure that a higher proportion of the funding is allotted to technical and vocational education and training. This would ensure that in addition to tertiary level education, young people receive adequate vocational training, which matches the expectations of the employment market.

Who will be the next FSE&CC President?

Since its inception in 1964, the FSE&CC has consistently upheld the principles of democracy and good corporate governance contemplated in its Constitution. […]

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Since its inception in 1964, the FSE&CC has consistently upheld the principles of democracy and good corporate governance contemplated in its Constitution. The FSE&CC Constitution provides for a two (2) year term for its President and Governing Board. The presidential position cannot be held for more than two (2) consecutive terms. On Friday, the 22nd September 2017, the FSE&CC shall continue to uphold this legacy during its Annual General Meeting. On that day, the members of the FSE&CC shall, through the ballot box, answer the questions, “who shall be the next FSE&CC President, who shall be appear in the below list of noteworthy business people who have ably captained the FSE&CC ship over the past four (4) decades?”

1964-65 N. Kirsh
1965-67 L. Aldred
1967-68 J. G. Richardson
1968-69 Dr. J Mackenzie
1969-72 D. A. Crabtree
1972-73 J. G. Richardson
1973-75 Rev. Forrester
1975-77 C. Harland
1977-79 R. M. Taft
1979-81 D. A. Crabtree
1981-84 D. Von Wissel M./F. D. Jelley/N. Crowther
1984-87 N. Crowther
1987-89 J. P. Hughes
1989-94 D. Von Wissel
1993-94 R. H. Howe
1994-95 M. R. Seal
1995-98 T. C. Mulroney
1998-01 D. Von Wissel
2001-03 M. I. Hlatshwayo
2003-09 Z. M. Nkosi
2009-11 A. Dlamini
2011-12 T. Mawocha
2012-13 Fikile Nkosi
2013-16 Sandile Simelane
2016-17 A. Le Roux

Members shall not only elect the President but they shall elect the Vice President: Commerce and Trade and the Vice-President: Industrial Relations & Social Policy. They shall also elect twenty-two (22) other Board members who shall be representing the various sectors of the national economy. The outgoing members are appreciated for their dedication, effort and guidance in driving the advocacy agenda of the FSE&CC in the past two years. Especially, in circumstances, where they are not remunerated for their service, since the FSE&CC is a voluntary body meant to drive the interests of business.

FSE&CC Outgoing Board of Directors
1. Andrew Le Roux - President Montigny
2. Fikile Nkosi – VP Trade & CommerceNedbank
3. Bheki Maziya – VP Industrial RelationsRSSC
4. Nick JacksonRSSC
5. Siphephiso DlaminiNAMBoard
6. Guy MoreSwaziland Plantations
7. Dennis MbingoFirst National Bank
8. Mvuselelo FakudzeStandard Bank
9. David RobertsInyatsi Construction
10. Ambrose DlaminiMTN Swaziland
11. Petrous DlaminiSPTC
12. Sikhumbuzo Tsabedze SWSC
13. Vusi GamaSEC
14. Dale AllenSwazi Wire
15. Zama KuneneSwaziland Beverages
17. Carol NgcoboAM Recruitment
18. Brett FossMbabane Motors
19. Wilhelm De KokerPick ‘n Pay (Mbabane)
20. Alex MngomezuluSwaki Investment Corporation
21. Busi SimelaneMacmillan
22. Vic RoyceFashion International
23. Marcus WardMbabane Hotels
24. Mduduzi MagongoUnitrans Swaziland
25. Stephenson NgubaneSwaziland Railway
26. Zama NgcoboSRIC
27. Nellie De SousaDups Insurance
28. Nonhlanhla DlaminiIDM
29. Dr. Penuel GinaMedisun
30. Francisco FerreiraGalp
OTHER MEMBERS (27/10/15)
31. Dr. Sipho NkambuleSwaziland Cane Growers Ass.
32. Mr. Vic IrwinWoodmaster’s
33. Mr. Oswald MagwenziUbombo Sugar

The FSE&CC remains the most influential business association in Swaziland, which represents the interests of over 500 enterprises in Swaziland. These enterprises employ over 100,000 of the workforce in the formal sector and contribute to over 60% of the national GDP. In light of this huge responsibility, that is borne by the FSE&CC Board, in representing all its member enterprises, members are encouraged to finalise their nominations and make their voice heard at the AGM, when deciding on who shall protect and lead the private sector’s interest for the next two (2) years. Especially because, the recently released reports of the International Monetary Fund (IMF) and the World Bank paint a bleak picture of the national economy.

The IMF Report has revised downwards the country’s 2017 GDP growth projection from 1.65% to 1.0%. The main reasons cited are the prolonged effects of the drought, the sharp decline in SACU Revenue and the continued expansionary Policy (mostly in the form of increased governments spending, rather than tax cuts).

The World Bank Ease of Doing Business Report 2017 ranked down Swaziland from 108 to 111 out of 190 countries. The downward movement was attributed to the fact that the reforms that took place did not address the main issues of either reducing time and/or the costs of administrative processes. These reforms include the implementation of ASYCUDA World for customs declarations, the hiring of more judges to ease the judicial congestion, the implementation of Sekulula VAT refund system, the introduction of the Government USSD code to ease the application process for starting a business (among other government services). In view of such circumstances, we wish the nominees the best of luck in the upcoming elections.

What Explains Low Private Investment and Responsiveness of Employment to Growth in Swaziland?

Since 2010, economic growth in Swaziland has been sluggish and private investment has declined. Unemployment has remained high and employment has been little responsive to growth. […]

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Since 2010, economic growth in Swaziland has been sluggish and private investment has declined. Unemployment has remained high and employment has been little responsive to growth.

Economic slowdown and government’s financing shortfalls have started adversely affecting the banking sector. Since 2012, credit growth to the private sector has averaged 11.5 percent, but decelerated to 7.5 percent in 2016 as corporate lending growth turned negative.

However, credit to households for mortgages and durables remained buoyant, contributing to increase household indebtedness. At the same time, banks’ asset quality deteriorated, with non-performing loans (NPL) rising rapidly and exceeding 10 percent of total loans (end-March 2017). As government’s financing needs increased, banks’ direct exposure to the public sector rose and holdings of government securities reached about 11 percent of banks’ assets.

Growth performance over the last decade has been held back by a negative contribution to growth by capital formation, which has been associated with a decline in the private investment to GDP ratio. Despite a recent increase in public investment, overall investment has declined from 16.7 percent of GDP in 2000 to 8 percent of GDP in 2015. Over the last few years, the unemployment rate has remained persistently high at around 28 percent of the labour force, and higher than in other lower-middle income countries (the regional estimated unemployment rate is 5.3 percent). In addition, despite growth recovered in the post-2010 crisis, employment has changed little, making it unresponsive to growth and signalling a possible structural phenomenon.

Promoting growth and employment are critical developmental priorities for Swaziland. They are essential to address the high poverty rate (63 percent of the population lives in poverty) and income inequality (one of the highest in the world).

International comparisons suggest that specific structural impediments are limiting both private investment and the responsiveness of employment to growth. Three factors seem to play a role.

a) Skill Mismatches
Swaziland has very high skills mismatches in the labour market, which are usually associated with poor employment and investment performance. According to the global skills mismatch index, Swaziland has one of the highest skills mismatch index in the world, ranking 136th out of 139 countries. One possible source of such mismatch may be because there is a relatively low supply of skilled labour force in the country. Past studies have shown that high skill mismatches are typically associated with higher unemployment rates. Consequently, this affects firms’ decision to invest as industries might find difficult to grow without an adequately skilled labour force.

b) Disconnect Between Wage and Productivity Trends
Disconnection between wages and productivity dynamics is hurting investment and keeping unemployment rates high. Swaziland has a large gap between wage dynamics and productivity trends. In particular, given the prominence of the public sector in the economy, fast increasing public wages generally drive private sector wages, generating a gap with productivity. Cross-country analysis suggests that this gap is associated with both high unemployment and low private investment rates. Previous studies find that real wages growth above labour productivity trends can contribute to keep unemployment rates high. At the same time, rising labour costs hurt firms’ profitability, which negatively affects investment decisions and new investments as well as competitiveness, thus discouraging foreign investment. Cross-country correlations for lower-middle income countries show that in general, the gap between wages and productivity is associated to lower investment and higher unemployment.

c) Rigidities in the Business Environment
Swaziland presents several weaknesses in the business environment that can potentially limit job creation and investment. Swaziland’s ranking in the Global Competitiveness indicators is not becoming any better. The recently released Global Competiveness Index Report for the year 2017/18 ranks Swaziland 122nd out of 137 economies. Swaziland ranks clearly below the average of middle income countries in legal contract enforcement (it attains 1.59 compared to an average of 4.1 points, on a 1-10 scale), higher education and training (3.2 against an average of 3.9 points, on a 1-7 scale), and the business impact of HIV (with an index of 2.6 compared to an average of 5, on a scale 1-7 with high indicating less negative impact) given the very high HIV prevalence in the country. This highlights areas that affect competitiveness where there is significant room for improvement.

d) Dividends from Structural Reforms
Lower skills mismatches and better connection between wages and productivity have the potential to increase private investment. Following a report by the International Monetary Fund (2015), estimating an investment accelerator model for middle income countries during 2005-2014 suggests that skill mismatches are negatively correlated to investment and better connection between wages and productivity is positively associated to investment. In addition, more flexible frameworks in determining wages (a measure of labour market rigidities) support higher investment. There are indications that business environment indicators, such as protection of property rights are positively related to investment.

Swaziland may benefit from implementing structural reforms that boost private investment, and strengthen the nexus between employment and growth. Structural measures aiming to reduce skills mismatches by improving educational outcomes in the population, aligning wage growth with productivity, strengthening institutions, and reducing rigidities in the business environment seem to be at the forefront of private sector development, boosting investment and sustainable job creation.

Trade Information Portal: A Necessity for the Business Community

Information and Communication Technologies (ICTs) have continued to advance throughout the years since inception. […]

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Information and Communication Technologies (ICTs) have continued to advance throughout the years since inception. The world of business has significantly benefited greatly from the constant ICT improvements. Trade, loosely defined as the buying and selling of goods and services with compensation paid by the buyer to the seller is central to business and therefore it is imperative for Governments, in collaboration with the private sector, to develop mechanisms which facilitate the ease of trade both locally, regionally and internationally.

Commerce and Trade Departments in Governments of developed countries in Europe and the Americas, such as Sweden, the United States of America, Germany, Spain and some developing countries in Africa such as Lesotho, Botswana, Malawi, Cambodia, Jamaica, Bangladesh, have put in place national trade information portals where traders can easily access up to date information related to trade. The World Bank Group (WBG) has been assisting developing countries with establishing the Trade Information Portals (TIPs) as part of their mission. The WBG defines a Trade Information Portal as a “website that contains all regulatory trade related information for import/export/transit combining information from all agencies involved in import/export control such as Customs, Agriculture, Health, Quarantine, Transport, Science/Technology, etc.”

International Obligations
Article 1 of the Trade Facilitation Agreement speaks to the publication and availability of information which means that information pertaining to trade should be published promptly to allow governments and traders to become acquainted with them. It states that each member of WTO shall promptly publish the following information in a non-discriminatory and easily accessible manner in order to enable governments, traders, and other interested parties to become acquainted with them:

  • Procedures for importation, exportation, and transit (including port, airport, and other entry-point procedures), and required forms and documents;
  • Applied rates of duties and taxes of any kind imposed on or in connection with importation or exportation;
  • Fees and charges imposed by or for governmental agencies on or in connection with importation, exportation or transit;
  • Rules for the classification or valuation of products for customs purposes;
  • laws, regulations, and administrative rulings of general application relating to rules of origin;
  • Import, export or transit restrictions or prohibitions;
  • Penalty provisions for breaches of import, export, or transit formalities;
  • Procedures for appeal or review;
  • Agreements or parts thereof with any country or countries relating to importation, exportation, or transit; and
  • Procedures relating to the administration of tariff quotas.
The Agreement adds and stipulates that each country, Swaziland included, shall make available, and update to the extent possible and as appropriate, the following through the internet:
  • A description of its procedures for importation, exportation, and transit, including procedures for appeal or review, that informs governments, traders, and other interested parties of the practical steps needed for importation, exportation, and transit;
  • The Forms and documents required for importation into, exportation from, or transit through the territory of that Member;
  • Contact information on its enquiry point(s).
Article X of General Agreements on Tariffs and Trade on the Publication and Administration of Trade Regulations requires transparency of the publication of the information provided. Transparency reduces costs both for traders and governments. It allows for greater predictability for traders as there is less time to find information, less likelihood of rejection of goods and services being traded because of wrong procedures and there less opportunity for interpretation of laws, regulations, etc.

One of the major concerns of the private sector in developing countries such as Swaziland is lack of transparency. The WBG supports the notion that improved transparency can lower trade costs for both traders and government and improves predictability. This is a key objective of the World Trade Organisation’s Trade Facilitation Agreement.

As a result, Trade Information Portals are increasingly becoming common in the World Bank Group’s trade facilitation projects. To date, more than a dozen countries have received support on setting up Trade Information Portals from the World Bank Group, using a custom built software platform.

Functions of Trade Information Portals
Often times, traders are involved in international trade and for this to happen, they need various kinds of documentation from various government agencies such as the Ministry of Commerce, Industry and Trade, Ministry of Agriculture and the Swaziland Revenue Authority (SRA). In general and in many developed countries, such documentation is readily available on different websites which are managed by the relevant government agencies/departments. However, many of the developing countries do not have such websites and if they do, the information available is either not up to date or is incomplete or the content may not cover the entire spectrum of information that a trader may wish to obtain to ensure compliance with import, export or transit requirements.

Traders are forced to physically visit the various government agencies to enquire about international trade and source relevant trade documentation. This tends to be costly, time consuming and frustrating. In other instances the scope of what pertains to one agency overlaps with or impacts another. In the absence of a single authoritative reference point, the interpretation of certain requirements by one agency may conflict with the way requirements are interpreted by another agency causing unnecessary effort and cost to be expended in attempting to meet various government requirements. TIPs have the major function of publishing all laws, regulations and procedures relevant to trade. These include; procedures for license and permit applications, prohibitions, restrictions, copies of all forms, trade statistics, and many other documents related to trade. These portals also serve as enquiry points on trade.

It is exciting and therefore a relief to the Swaziland business community to know that a TIP is in the pipeline for Swaziland. A workshop, facilitated by the WBG was held on the 4th August 2017 at the Mountain Inn, Mbabane. The workshop was aimed at sensitising stakeholders and discussing the key elements of the development and operationalisation of a TIP and the necessary procedures to adopt if Swaziland wants to embark on such a project.

Benefits of a Trade Information Portal for Swaziand
With a central source of all trade related regulatory information, provided it is comprehensive, accurate and up-to-date, substantial benefits with regards to trade facilitation can be enjoyed. If adequate guidance can be obtained without the need of seeking advice in person from different government agencies, costs could be minimised. Conflicts and penalties for non-compliance would be avoided by having a central authoritative reference point.

The Voice of Business fully believes that a TIP can provide savings in the time spent finding information on trade and commerce information, can significantly lower the overall cost of doing business and can afford business time to find innovative ways of improving their businesses and productivity; ultimately contributing to improving the country’s overall World Bank rating in terms of transparency and the ease of doing business, which was 108 in 2016 and 111 in 2017. We still await a ranking from the World Economic Forum.

The Voice of Business further believes that such a Portal will require reliable and affordable communication internet services and low.

The Swaziland We Want

Five years before the independence of Swaziland from the British Protectorate (6th September 1968), 32 countries met in Addis Ababa and the Organisation of African Unity (OAU) was formed on 25th May 1963. […]

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Five years before the independence of Swaziland from the British Protectorate (6th September 1968), 32 countries met in Addis Ababa and the Organisation of African Unity (OAU) was formed on 25th May 1963. The purpose of the OAU was to “promote unity and solidarity amongst African states” and “to rid the continent of the remaining vestiges of colonisation and apartheid”. “May this convention of union last 1,000 years” said the then leader of the OAU Emperor Halie. Emperor Haile Selassie hosted that first ever African Summit, during which the organization was born.

When the African Union was founded, the leaders of that era understood that the success of their individual countries hinged on the success of the entire continent. The OAU initiated the transformation of Africa, to engage the rest of the world as a group of independent, developing countries.

Thirty-eight years later, the OAU, was dissolved on 26th May 2001 and the member countries formed the African Union (AU). The post-colonial growing pains that had resulted in chaos and poor governance for many nations were now giving way to peace, democracy and the rule of law.

The African Union is a well-structured organization with precise goals, a primary one of which is "to accelerate the political and socio-economic integration of the continent." The AU has launched many initiatives, including Second Decade of Education for Africa (SDEA), Comprehensive Africa Agriculture Development Programme (CAADP), Program for Infrastructure Development in Africa (PIDA), Accelerated Industrial Development for Africa (AIDA), Boosting Intra-African Trade (BIAT), Continental Free Trade Area (CFTA) initiative, and very importantly, Agenda 2063 – The Africa We Want. Africa is today at midcourse, in transition from the Africa of Yesterday to the Africa of Tomorrow.

People who were born in 1963 in Africa, had an average life expectancy of under 45 years. Sadly, the majority of African citizens who were born in 1963 or before, are not able to witness how far the continent has progressed and its ambitious goals for the future. Based on 2016 statistics; life expectancy is 59 years for males and 62 years for females. Even though this is seemingly impressive progress, Africa, on average, is behind most other regions of the world in improving this statistic.

But what is encouraging is the fact the AU now has a clear set of goals to be achieved by 2063. Collaborating with the United Nations (UN) and synchronised with its Sustainable Development Goals (SDGs), Agenda 2063 sets measurable targets that will be monitored regularly. The fundamental list of aspirations with unanimous agreement of all member countries is as follows:

Our Aspirations for the Africa we want:
A prosperous Africa based on inclusive growth and sustainable development; an integrated continent, politically united and based on the ideals of Pan Africanism and the vision of Africa’s Renaissance; an Africa of good governance, democracy, respect for human rights, justice and the rule of law; a peaceful and secure Africa; an Africa with a strong cultural identity, common heritage, values and ethics; an Africa where development is people-driven, unleashing the potential of its women and youth; Africa as a strong, united and influential global player and partner. (Source: African Union, Agenda 2063 – The Africa We Want).

Africa faces significant challenges in reaching these goals. Below are some of the important issues that we, as African People, need to work on collectively, in a proactive manner, to achieve inclusive growth, social and economic development: Agricultural development (food security); Crime and violence (including domestic violence); Environmental sustainability and climate change initiatives; Equal opportunity for all (social, racial, religious); Facilitation and effective regulation of trade-in-goods and trade-in-services (addressing tariff and non-tariff barriers, regulatory obstacles); Financial market governance and regulation; Foreign direct investment (FDI) generation and management; Gender equality; Good public sector governance (efficiency, efficacy and financial management of government services, reforming fiscal system – cutting red tape; effective regulatory governance); Health services; communicable/non-communicable disease management; HIV/AIDS; High quality education for all (including digital literacy); Infrastructure for Transport; Energy (renewable sources); Water and sanitation; Information and Communication Technology (ICT); Job creation; Labour regulation; Law and justice system; Natural resource management; Peaceful negotiation of conflicts (elimination of armed conflicts and forced movement of people); Poverty reduction; Practical regional integration agenda – with emphasis on effective implementation; Private sector development (especially micro, small and medium enterprises); Public-private-partnerships; Rural development; Social security and assistance; Terrorism threat; Urban development (smart cities).

Improvements in these issues will contribute to more inclusive economic growth, achieving sustainable development goals (SDGs) and assist Africa to play a key role in the global economy, as well as its governance structures. For Swaziland, a new development trajectory should enable it to provide decent jobs, including, in particular, to the majority of the youth and women. It also needs to produce enough food for its entire population, especially the most vulnerable. To do so, the country needs to industrialise, but this requires that it resolves some of its major deficits first. One priority is to address the infrastructural deficit, especially the energy deficiency. Without energy, nothing else can happen. Energy fuels economic activities, especially production, industrialisation and the delivery of services. The country will also need to resolve important shortfalls in its labour market, in particular, labour productivity and costs; and, the adequacy of skilled labour for market needs, especially in the industrial and manufacturing sectors. Another important priority for Swaziland will be to expand domestic market sizes in order to benefit from potential economies of scale across the continent. This can be achieved by increasing intra-regional trade so that Swazis can feed themselves, instead of allocating most of their income to imports from mainly South Africa and emerging markets. Adopting such a development trajectory will lead to a real structural transformation in the Kingdom and, thereby, to improvements in the living conditions for many of our poor people.

Liability for exercising the Right to Strike

It often happens that in the course of the employment relationship, the parties to such a relationship will view matters that affect them differently. This often happens in the course of collective bargaining. […]

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It often happens that in the course of the employment relationship, the parties to such a relationship will view matters that affect them differently. This often happens in the course of collective bargaining. The much disputed issue is often wages or salary increments. In Swaziland, collective bargaining is regulated, in the first instance, by the Industrial Relations Act No.1/2000 (as amended). This legislation outlines the method to be followed when a duly registered trade union wishes to engage in a strike action. It also creates the nature of the dispute that may be subject to strike action.

In terms of the Industrial Relations Act, only an interest dispute may be subject to strike action. A rights dispute may only be resolved not by power play but by arbitration or court litigation. There are certain “jurisdictional requirements “that must be followed by a party wishing to take strike action. The requirements are that firstly, the dispute must have been certified as an unresolved dispute by the Conciliation Mediation and Arbitration Commission (CMAC). Secondly, the dispute must be an interest dispute and not a rights dispute. Thirdly, the dispute must not be engaged in an essential service. And lastly, all the provisions of the Act must be followed, that is, in terms of strike notices and notifications to CMAC and the Labour Commissioner.

It is critical to note that parties in an essential service cannot, in law, engage in a strike action. Services which have been designated as essential services in terms of section 93(9) of the Industrial Relations Act No1/2000 (as amended) include water services, electricity services, fire services, health services, sanitary services and telephone and graphic services. Disputes in essential services are resolved by arbitration. It is also important to state that parties to an essential service may enter into an agreement designated a services to be a minimum maintenance service. In this way, employees who fall outside the designated minimum maintenance service designation are still prohibited from engaging in a strike action or in the case of employers, effecting a lockout.

Employees who engage in a lawful strike action are protected from a number of occupational threats. Any employee who takes part in a strike action does not breach his employment contract nor does he commit a delict simply by taking a part in a protected strike. A protected strike is one that complies with the jurisdictional requirements and the other provisions of the Industrial Relations Act.

However, and critically, an employer is not obliged to remunerate an employee for services that the employee does not render during a protected strike or during a protected lockout. This essentially means that notwithstanding the lawfulness of the strike, at the end of the month or week or fortnightly, no wages or salary is due to the employee for the number of days he did not render services to the employer.

Typically, this has been taken to mean that this affects only the cash component of the remuneration. The employer is entitled to also withhold benefits for the duration of the strike action. Hence, where an employer contributes a portion of the pension or housing or medical aid, the employer is entitled to withhold a pro rata contribution of these benefits. These benefits accrue because of actual personal services having been rendered to the employer. Where no such services have been rendered because of a lawful strike, it follows that there is actually no reason for an employee to “benefit” from his own temporary suspension of his services.

Remuneration is defined in the Act as meaning wages or salary and any additional payments payable in cash or kind directly or indirectly by an employer in connection with the employment of an employee. Further, in terms of the Employment Act No.5/1980 (as amended) wages is defined as meaning remuneration or earnings including allowances, however designated or calculated, capable of being expressed in terms of money and fixed by mutual agreement or by law which are payable by an employer to an employee for work done or to be done under a contract of employment or for services rendered or to be rendered under such a contract.

Hence, the prejudicial effect of withholding a pro rata share contributions in respect of benefits is not different to the withholding of a pro rata share of remuneration where an employee participates in a protected strike. The moral of the story is that an employer may withhold not only remuneration but also benefits as a result of an employee’s absence from work due to participation in a strike, including a lawful, and hence protected strike.

The National Minimum Wage Debate in Swaziland

Worker representatives represented in the Labour Tripartite structures, have called for consideration for establishing a National Minimum Wage of Three Thousand Five Hundred Emalangeni (E3 500) in Swaziland. […]

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Worker representatives represented in the Labour Tripartite structures, have called for consideration for establishing a National Minimum Wage of Three Thousand Five Hundred Emalangeni (E3 500) in Swaziland.

It is imperative that, as the Social Partners, engage on this proposal, they, and the nation at large, critically and truthfully scrutinise a number of principles and ask key questions in the context of the Swaziland economy.

Questions such as the basis for this proposal in the context of the currently legislated Wages Councils of various sectors of the economy; what informs the proposal; what is the size of the workforce that will be ‘entitled’ to the proposed minimum wage; how will the proposed minimum wage be funded; what is the expected return on productivity for the minimum wage; can Government, as the largest single employer, afford to pay a minimum wage of this magnitude; what will be the effect on the overall unemployment level, currently at 42 percent.

It is a fact that in Swaziland, as compared to other countries in the region, the businesses in the private sector are already under pressure; the economy is contracting and Government owes the private sector millions of Emalangeni for services rendered in the past twelve months. Added to this, Swaziland has the highest costs of doing business in terms of inputs such as electricity and telecommunication. Swaziland’s ranking in the World Economic Forum Index of ‘The Ease Of Doing Business Index’ fell in 2016 and Foreign Direct Investment fell by almost 50 percent in the same year. Truth is, businesses in Swaziland are struggling to rise above such challenges whilst trying to improve the Swazi economy through substantial job creation initiatives.

The debate by the Tripartite Social Partners should therefore not only focus on the interests of those who are already in gainful employment but should also consider the impact that this will have on the ones seeking employment.

It is the view of the Voice of Business that a National Minimum Wage in Swaziland will generate more ‘heat’ than ‘light’ by misrepresenting the difficult choices faced by any policy-maker who is concerned about poverty alleviation and welfare inequalities within the economy.

Until there is full understanding, at a national level, of what the implications and impact of a National Minimum Wage will be, the Voice of Business would urge the Social Partners not to rush on this matter. The Voice of Business fully supports the requesting Social Partner that a full and detailed research needs to be undertaken before a proposal of this nature could be considered for implementation. What may well be a well-intentioned initiative could possibly have devastating negative consequences on the Swaziland economy, and the ability for Swaziland to create jobs and attract investment.

Arguing for a high national minimum wage floor, even if phased-in, to the Voice of Business, seems to entail what might be called ‘unemployment denialism’; that is, the denial that poverty in Swaziland is primarily the result of massive unemployment and the assertion instead that the high poverty levels are due primarily to low wages (as is the case in Brazil and the USA). How true is that? To calculate a proposed minimum wage from a ‘median wage’ based on the wages of the low percentage of people that have jobs is to blithely ignore the zero wages of the 42 percent of Swazis who are unemployed.

The Voice of Business contends that, in order to start to eliminate low wages and (as the cause of low wages rather than their consequence) low investment, low productivity and low employment, we should put the horse before the cart by raising the levels of investment in the productive sectors of the Swazi economy, taking into consideration the fact that Swaziland currently lags hopelessly behind its peers in the SADC region. When played correctly, high investment, high productivity and high employment can be accompanied by higher wages. This would require a significant restructuring of the Swazi economy.

Therefore, the implementation of a minimum wage should be an integral part of a package of a far-reaching Industrial Policy, and other interventions as well as the re-orientation of the country’s macro-economic policy. These are neither short-term nor quick-fix remedies. This restructuring can be achieved by building upon sectors in which productivity can be advanced at levels that pay decent wages.

For uncompetitive sectors, improvements in productivity through improved efficiency and innovation are needed together with a possible reorientation to move away from producing cheap goods towards higher value-added and niche products. Expanding domestic markets, boosted by higher wage income, could underpin economies of scale and productivity increases, while local industry, in an era of fast production cycles, could leverage its proximity to the continent’s major retailers to increase exports. In this vision for the economy, tradable sectors that can sustain higher wages would be promoted.

For this to be achieved, it is critical to have a nuanced Government policy that would provide the necessary incentives and regulation combined with direct investment in skills, research and development and world-class infrastructure, as well as a stable, corruption and crime-free environment. Abandoning restrictive macrooeconomic policies is essential to support such a programme. This means lower and regulated interest rates, preferential financing for chosen industries, and limiting financial market speculation.

The mere possibility of unprecedented consumption-led employment growth hardly seems to warrant setting a national minimum at a level that has a high probability of destroying jobs in sectors such as agriculture, destroying entire sectors such as textile and reducing the possibility that labour-intensive sectors could grow in future. Minimum wages present one of the most difficult choices to any policymaker concerned with poverty, inequality and unemployment. It demands careful analysis and nuanced policy interventions – not a blanket approach to a very complex matter with high risks of unintended and perverse consequences.

In conclusion, it must be understood that the Voice of Business is not advocating for the reinforcement of a low-wage regime, but rather, a well-designed restructuring policy package to stimulate investment and productivity, which supports the growth of employment in the relevant sectors, thereby establishing a high-wage growth path for the economy.

The Informal Sector: Challenges Of Development In Swaziland

With a gross domestic product (GDP) per capita of about $4057.28, Swaziland is classified as a lower middle income country. […]

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With a gross domestic product (GDP) per capita of about $4057.28, Swaziland is classified as a lower middle income country. The 2017 GDP growth projects released by the International Monetary Fund for Swaziland have been revised downwards, from 1.65% to 1.0% . The main reasons cited are the prolonged effects of the drought, the sharp decline in SACU Revenue and the continued expansionary Policy (mostly in the form of increased governments spending, rather than tax cuts).

After nearly five decades of independence, poverty, unemployment, and inequality remain persistent problems afflicting a majority of the Swazi population. In seeking to improve the quality of life for all its inhabitants, it is imperative that the country reduces poverty, creates employment, and redresses widening inequalities.

At more than 50% of the labour force, youth unemployment in Swaziland is disturbingly high and ultimately not sustainable. The issue of youth unemployment in Swaziland is particularly concerning in urban areas, where it is almost triple of the adult unemployment rate. In contrast, in rural areas the difference between youth and adult unemployment is less pronounced and unemployment impacts the entire population. In Swaziland majority of the unemployed youth is less skilled than their employed counterparts.

Unemployment in Swaziland

Youth Population
Aged 15-24 years Aged 20-24 years Aged 20-29 years
Employment State
Unemployed 53.81 53.14 40.83
Public sector employment 2.28 2.96 7.18
Formal private sector employment 33.65 34.44 40.03
Informal private sector employment 3.77 2.51 2.34
Inactive 1.05 1.14 0.85
Self-employed 5.43 5.82 8.77
Urban 37.10 43.09 46.24
Rural 62.90 56.91 53.76

The Informal Economy
The informal economy is the diversified set of economic activities, enterprises, and workers who are not regulated or protected by the state. Employment in the informal economy is categorized (formal ILO definitions) as:

Self-employment in informal enterprises:
  • employers
  • own account operators (don’t employ anyone else)
  • unpaid contributing family workers
Wage employment in informal jobs:
  • non-standard employees of informal enterprises
  • non-standard employees of formal enterprises
  • casual or day labourers
  • industrial outworkers (also called homeworkers)
Neither the public sector nor the private sector is able to provide enough jobs for the expanding labour force. Informal sector is increasingly recognised as an alternative option to the growing unemployment, particularly among the youth and the poor. Efforts to improve the performance of the sector should be seen, in light of the potential contribution of informal sector to increasing the overall performance of the economy including its regional and local productive economic capabilities.

Challenges faced by the Formal SME Sector
The increasing levels of poverty seem to indicate that the benefits of the high export and economic growth rates did not trickle down to the large proportion of the population. Hence the need for scrutinizing past development strategies and investigating the past, present and potential role of SMEs in export activities. Moreover the increasing rates of unemployment could be an indication that the export firms are using relatively more capital-intensive production strategies thus making limited contributions towards employment creation. This highlights the role of involving and promoting firms that make use of labour-intensive production strategies, such as SMEs.

  • The private sector in many developing countries exhibits a dual structure – a few large, modern, capital enterprises and micro and small enterprises serving local markets.
  • It is evident that SMEs cannot fulfil their potential role because of the various bottleneck factors
  • Through the formalization some enterprises can address these problems related to their size and improve their competitive position.
  • It is also recognized that SMEs represent an increasingly important form of participatory development in developing countries. They can make a major contribution to the improvement of the environment they operate in by serving as a vehicle for the expression of their views, taking collective action, delivering core services, and networking among members and other stakeholders.
  • Access and integration into local, national, and global markets require substantial investments in sustainable institutional and physical infrastructure development and service delivery to SMEs in all areas, including those that are remote.
  • Enhancing women’s ability to participate in SME development should be taken into account at every level, as women account for an important share of private sector activity and contribute most to poverty reduction.
  • Gender dimensions need to be mainstreamed throughout SME development strategies and programs, with additional specific, targeted initiatives directed at critical roadblocks.
  • Dialogue and partnerships between the stakeholders fosters ownership of these strategies, engenders them more implementable and making them credible and sustainable.
Swaziland’s key challenge as stated in the IMF Report is to preserve macroeconomic stability against low SACU revenue and make inroads in reducing poverty and income inequality. With an expansionary fiscal policy contributing to an unsustainable outlook and external and financial vulnerabilities, discussions focused on the need for: (i) fiscal adjustment to bring the fiscal deficit in line with available financing, contain public debt dynamics and preserve external buffers; (ii) managing risks from fiscal and financial sector linkages and the large non-bank financial sector; and (iii) advancing structural reforms to generate sufficient growth and jobs to reduce poverty and inequality.

Technology and minimum wages are likely to change the mix of capital and labour in industry

While technology is making capital cheaper, policies like the national minimum wage will make labour more expensive. What does this mean for the choices businesses make in terms of labour and capital inputs? […]

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While technology is making capital cheaper, policies like the national minimum wage will make labour more expensive. What does this mean for the choices businesses make in terms of labour and capital inputs?

Friedrich Kreuser, a researcher at Stellenbosch University writes:

In South Africa, and globally, a number of trends are changing the relative price of labour. The coming implementation of a national minimum wage will substantially increase the cost of employment, particularly of lower-skilled workers. In parallel to this, the ongoing ‘Fourth Industrial Revolution’ is making technology cheaper and more widespread. The impact of both of these on employment depends crucially on whether firms can move away from using people and towards using machines (capital), or whether these two inputs must be used together.

The issue of capital and labour substitutability should be central to the employment debate. However, this matter is often neglected. It relates to the following:

At the extreme, if machines (capital or technology) and people (labour) are perfect substitutes, they can be swopped relatively easily, even to the point where only one of these is used for production; in such a situation, employment can be created without having to add any more capital. If they are imperfect substitutes (or complements), then both are required in some ‘mixture’ and swopping them is constrained; accordingly, more capital would be required if more labour were to be employed (i.e. to create employment); therefore, constraints to capital accumulation may create constraints to employment creation.

Likewise, the substitutability between different types of labour – whether one can replace one type of labour with another – is a critical issue (i.e. complementarity within employment matters too). Can low-skilled workers be hired instead of high-skilled workers, or does one group need the other? And what about semi-skilled workers? Understanding these relationships is important when crafting sensible polices for a country which has had persistently high rates of unemployment, particularly amongst those with lower skills.

A gap in the unemployment debate

The ‘standard’ narrative used to explain high levels of unemployment is that those who are unemployed lack the skills which firms require. In this narrative, the policy solution is simple (although the implementation may be difficult): provide the requisite skills to those who are unemployed. Various government initiatives attempt this solution. For example, Skills Education and Training Authorities (SETAs) train workers based on firms’ needs, while learnerships provide subsidised employment and training for new entrants into jobs. A further constraint is the state of the education system. Work by Stellenbosch University’s Research on Socio-Economic Policy (RESEP) group shows how the school system underperforms and perpetuates inequality in the labour market. However, educational reform will require political will and capital and, even if it were implemented today, it would be likely to take a generation to have a real impact.

Consistently missing from the ‘skills narrative’ is any discussion of the substitutability between factors of production (e.g. labour and capital/machines), including substitutability between different types of labour – and the central role that prices and wages play in encouraging firms to choose capital over labour, or one type of worker over another.

Discussing the effect that the relative price of labour has on demand is politically charged, as debates around the national minimum wage have shown. However, avoiding this issue neglects a potentially important factor which may be constraining job creation. Furthermore, identifying the substitutability or complementarity between factors of production can also identify other bottlenecks. For example, creating employment for unskilled workers may be constrained because complementary inputs (e.g. necessary machines or equipment which workers need) may be lacking.

As technology evolves, job creation is likely to become more difficult, particularly for unskilled workers (who form the bulk of the unemployed). This requires vibrant employment policies that will have a major focus on:

  1. Changing the relative price of labour. Cheaper labour will result in more employment; however, reducing wages is difficult practically, politically and ethically. An alternative approach would be for government to ‘top-up’ the wages of low earners, like the US’s Earned Income Tax Credit does. Such top-up amounts can encourage people to accept work at a lower employer-paid wage, since their combined earnings (wage plus top-up) will be higher. These costs accrue to the fiscus (i.e. taxpayers). In South Africa, where the bulk of tax is paid by higher-income earners and large companies, such a scheme is likely to be highly redistributive.

  2. Changing the skills composition of the workforce. Research suggests that higher wages for the low-skilled encourage substitution towards higher-skilled workers. A limited pool of these types of workers may limit this substitution. Growing the pool of skilled workers has the double benefit of reducing this constraint for firms but also of potentially improving the skills, and likely incomes, of some of the unskilled.
This suggests that policies to create jobs need to respond to the broader trends of the changing nature of work and technology and the changes in relative prices which result.

Services contribute to limited Local and Foreign Investment

Services such as finance, distribution and telecommunications are used intensely in the production and trade of all goods in an economy. […]

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Services such as finance, distribution and telecommunications are used intensely in the production and trade of all goods in an economy. Typically, services make up 10-20 percent of production and trading costs – communications, transport, trade finance and insurance, and distribution services. The price and quality of services are therefore crucial in determining the cost of all other products in the economy.

In turn, globalisation has made services an even more important factor in determining the competitiveness of goods producers. This is because of two facts. First, infrastructure based services have a significant impact on trade performance of an economy. For example, there is a proven trend that the reduction of transport costs causes an increase in trade. Second, entry into global production networks requires efficient and timely delivery. Therefore, low-quality services that delay production or transport effectively exclude producers from such networks.

The effects extend beyond any one-time gains and may have an impact on the growth rates of countries. Poor quality, high-priced services not only affect the current operations of manufacturers but also discourage future domestic and foreign investments by lowering the profitability of such investment. This partly explains why foreign direct investment (FDI) is limited in poor countries, Swaziland included, despite access to cheap labour.

Therefore, there is a case for the liberalisation of trade in services. Trade liberalisation should enable poor countries to expand the market for intermediate services, lower the price and improve the quality of services and better exploit the comparative advantages that they do have. Through trade liberalisation, producers of primary and manufacturing goods in a developing country can become competitive and a country can become more attractive as an investment location for industries relocated from industrial countries. Empirical evidence shows that FDI is unlikely to materialise outside extractive industries if multinationals do not have access to social infrastructure, utilities, and legal institutions of the necessary quality at a reasonable price.

Liberalisation of trade in services can take place within the ambit of multilateral trade negotiations, regional trade negotiations and bilateral trade negotiations. However, for a country with severe constraints in the services sector, unilateral liberalisation can prove to be the most effective approach. Even with the latter approach, it is important to understand that liberalization of trade in services does not happen through the reduction and elimination of tariffs and quota restrictions as applied to trade in goods. Instead, trades in services are liberalized through the reform of domestic regulations affecting trade in services as they pertain to market access of services and the treatment applied to foreign and domestic supply of services. Furthermore, trade in services should take into account all four modes of supply:

  1. Cross-border trade in services describes transactions that take place across international borders for example telecommunications and internet services;
  2. Other services may require the consumer to move to the location of the producer, as in the case of tourism;
  3. Factors of production may have to move across national boundaries to the place of consumption thus making FDI necessary in order to establish a foreign commercial presence. An example is foreign direct investment occurring through greenfield investment , joint ventures, mergers or acquisitions; and
  4. Temporary movement of labour may also be required to serve foreign consumers for example consultants.

Barriers to trade in services Restrictive domestic regulations that limit the access of foreign services and service suppliers to domestic markets can be classified into the following four categories:
  1. Quantitative restrictions such as quotas, local content, and prohibitions that are commonly applied to service providers. A country may have outright prohibitions directed against foreign providers of such services as domestic transport and basic telecommunications.
  2. Price-based instruments such as visa fees and entry or exit taxes. Government monitored price controls for example, air transport and telecommunications; and in some cases government subsidies in such services as communications and rail transport.
  3. Licensing or certification requirements may be imposed on foreign providers of professional and business services.
  4. Discriminatory access to distribution and communications systems prevails in a number of countries especially in such sectors as telecommunications, air transport, advertising, insurance, and dealer networks.

The most significant barriers to trade in services in poor countries are those related to the third mode of supply of services, that is barriers to FDI. General characteristics of barriers to FDI in service sectors are application of some form of screening or registration process involving various degrees of burden to the foreign investor; restrictions on the level or share of foreign ownership, particularly in some service sectors, and often in the context of privatisation; wide-spread use of case-by-case judgements, often based on national interest criteria; widespread use of restrictions on ownership and control, particularly in sectors such as telecommunications, broadcasting and banking.

In conclusion, the need and rights of a country to regulate the services industry must be evaluated against the effect of these domestic regulations on the quality and cost of those services, competitiveness of goods producers and welfare of the people. The argument holds because of the prominent role of services as an intermediate function in production. Even in an extreme case of a developing country that has no comparative advantage in services, that country could still gain from trade in services because it can concentrate on non-service sectors in which they have a comparative advantage for example, agriculture and manufacturing.

The Voice of Business Post Budget Analysis

On Wednesday, this past week, the Central Bank of Swaziland in partnership with Corporate Skills Centre and the Swaziland Bankers Association hosted the 2017 Post Budget Seminar. […]

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On Wednesday, this past week, the Central Bank of Swaziland in partnership with Corporate Skills Centre and the Swaziland Bankers Association hosted the 2017 Post Budget Seminar. The Voice of Business in Eswatini was part of the panel invited to present their views on the Budget that was recently delivered by the Minister of Finance. Firstly, the Voice of Business would like to congratulate the Minister on tabling a Budget, especially under such trying economic and social circumstances. There are, however, a few areas that the Voice of Business was hoping would have been addressed in this year’s Budget.

The Voice of Business would have loved to see a Budget that is geared towards growing the economy, and believes that the 2017/2018 Budget falls short of that. Growth in 2016 was stagnant, the GDP growth rate is expected to be at negative 0.6 percent. With a GDP growth rate less than 3 percent per annum over the last five years is evidence that the economy of the country requires improved ideas to increase economic productivity and output, resulting in positive trade results, reduced budget deficit, reduced trade deficit and reduced unemployment rate.

Against the backdrop of a shrinking economy as indicated by the expected GDP growth rate of negative 0.6 percent, one key element that we believe is missing is specific initiatives on job creation. While the Voice of Business acknowledges that there was a mention of the advent of Special Economic Zones, there is still a lack of information on how they will operate and what impact they will have with regards to attracting export-based investment (both foreign and domestic) and subsequently job creation.

Another concern that the Voice of Business had hoped would be addressed is the expenditure control. As we previously highlighted in one of our articles in the Swazi Observer, we believe that what happened in 2016 was a huge error by Government, wherein the public service wage bill was increased drastically by effecting an average 17 percent salary increment for its civil servants. We believe that this was done at the wrong time and put further strain on the Government’s fiscal situation. We were hoping that the Budget Speech would acknowledge that this was a miscalculation and highlight plans of how excessive recurrent expenditure will be reined in. Accountability and transparency in Government expenditure and financial resource utilization are extremely important. The Minister stated during the 2017 Post Budget Seminar that the government has invested in capital projects which in turn equates to job creation. In principle, this is true, but in reality it is negated by the cash flow problem that government has, which has caused a backlog in the payment of government suppliers. The situation on the ground is that a lot of companies are adversely affected by the late (and/or non-payment) and as such had to either scale down their operations or shut down.

The Voice of Business expected to see a strong statement from the Minister which speaks to a better managed cash flow situation in the country. This, in view of the Voice of Business, would ensure accelerated payments of businesses which supplies Government. Otherwise the current situation where Government still struggles to pay private sector companies in time causes more strain to businesses, some of them incurring serious finance costs and risking collapse.

We hope that the Public Finance Management Bill that is currently in Parliament will be passed soon, and will be implemented in trying to address some of the abovementioned challenges.

In line with the key message of His Majesty’s Speech from the Throne was ‘Rising Above Adversity to Create Prosperity for All’. The Minister, in his Budget Speech made a note of the need to reduce reliance on the Southern African Customs Unions (SACU) receipts, which constitutes about 42 percent of this year’s Government revenue, and has increased from 37 percent of the 2016/2017 revised Budget. The continued reliance on SACU proceeds as the main source of revenue has been talked about in many fora and yet we are still not seeing any new strategies which will end this dependency.

One such strategy is the establishment of a stability or anchor fund that will cater for extreme economic shocks that we have experienced. Further strategies include an honest and open discussion on the tax policy and how the informal sector can be brought into the tax bracket without jeopardising their disposable income.

During the Post- Budget Seminar, the Voice of Business has renewed calls for increasing funding to improve cross-border systems and processes. We believe that increased trade will directly improve revenue collected by Government. The Voice of Business continues to call for a 24-hour border operation which would boost trade access to SA - our biggest trading partner. There is no insurmountable reason why the Swazi Government has been unsuccessful in negotiating with its South African counterparts for the 24-hour operation of all its border posts to facilitate the flow of goods between the two countries. Furthermore, there is a need to improve trade relations with Mozambique bilateral trade agreements which we believe will also improve the country’s’ trade balance.

Lastly but not least, we hope that the Ministry of Finance is amenable to the suggestions of having stakeholder engagements before the Budget is tabled. The Voice of Business believes that there is still an opportunity for the country to develop a budgeting mechanism that is inclusive of all sectors of the social-economic landscape.

FSE&CC to host CEOs Luncheon Themed “The Foundational Principles of Trust in Leadership”

Following our article entitled “The Swaziland We Want” published in this reputable newspaper last week where we highlighted some of the collective social and economic goals of the SADC region […]

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Following our article entitled “The Swaziland We Want” published in this reputable newspaper last week where we highlighted some of the collective social and economic goals of the SADC region, to which our beloved Swazi Nation is part, it is of paramount importance to follow up with one aspect that is critical to realising the mentioned objectives. This is leadership.

Leaders within our society and economy are the custodians of THE VISION which points to the direction for all stakeholders involved. According to the author of “Leading from Here to There: Five Essential skills” Bill Haybels, “Swaziland Wins When Leaders Get Better”. He qualifies this view by pointing out that no one got to where we are today by ourselves. “We owe this to someone”, he says.

Another author, Andy Stanley encourages leaders to create a culture of recognising uniquely better ideas by being receptive to innovation rather than being critics of it. This will lay the foundation for followers to replicate these and be transformed through them.

These are profound and fundamental truths that we cannot ignore as a society in transition towards the attainment of first world status. We are aiming to build a strong economy that seeks to thrive and flourish above domestic and regional economic challenges, which makes it crucial to replicate effective leadership in our economy.

Management vs Leadership

Leaders across the globe have placed emphasis on management to lead organisations and companies towards the attainment of their respective goals in the recent past. However, with the advent of technological advancements in the business environment, people skills have assumed a much more sophisticated role. People/ employees are increasingly becoming the bearer of solutions to numerous challenges for companies. In fact, in most cases, issues involving people have been the source of conflicts that stifle productivity and thus lead to stagnation of profitability.

Let us, therefore, accentuate the blatant distinctions between leaders and managers. These are very different in approach. As people skills become more relevant in the workplace, they demand our attention to propel businesses where people are involved. Leadership and management must go hand in hand: they are not the same thing, but are necessarily linked and complementary. Any effort to separate the two is likely to cause more problems than it solves.

Still, much ink has been spent delineating the differences. The manager’s job is to plan, organise, and co-ordinate. The leaders’ job is to inspire and motivate. In his book “On Becoming a Leader,” Warren Bennis compared a list of the differences:

    • The manager administers; the leader innovates,
      The manager is a copy; the leader is an original,
      The manager maintains; the leader develops,
      The manager focuses on systems and structure; the leader focuses on people,
      The manager relies on control; the leader inspires trust,
      The manager has a short range view; the leader has a long range view,
      The manager asks how and when; the leader asks what and why,
      The manager has his or her eye on the bottom line; the leader’s eye is on the horizon,
      The manager imitates; the leader initiates,
      The manager accepts the status quo; the leader challenges it,
      The manager does things right; the leader does the right thing,
      The manager is the classic good soldier; the leader is his or her own person.

    In the new economy, value comes increasingly from the knowledge of people. These people look to their managers not just to assign them a task, but to define for them a purpose. Therefore, managers must organise workers, not just to maximise efficiency, but to nurture skills, develop talent, and to inspire results.

    The late management guru, Peter Drucker identified the “knowledge worker” and many other management truths. He realised the profound differences this worker would impact the way business is organised. With the rise of the knowledge worker, “one does not ‘manage’ people,” Mr Drucker wrote. “The task is to lead people. And the goal is to make the strengths and knowledge of every individual productive”.

    The Shepherd and the Flock

    As much as we may canvass for leadership as the most relevant solution to challenges we face in business operations on a daily basis, there are issues that are faced by leaders. Do leaders communicate the purpose and direction to be taken by the company to employees and then sit back with the hope that it will be achieved? Surely people have specialised expertise to see the task through, but does the leader let them ‘steer the ship’ in isolation? How much innovation does the leader allow to be exercised? We need to address the issue of ‘trust’ and the amount of it to be accorded by the leader on the employee. Also, how does the leader cultivate trust among his/ her employees towards them?

    The Voice of Business is pleased to announce that it shall host a prestigious event reserved only for leaders of business in Swaziland to address the above highlighted issues to do with trust in leadership. This is a great opportunity to show appreciation and support for the efforts and contributions of an important group of stakeholders in the business community without which business would collapse. CEOs who attend will have an opportunity to network with their peers, exchange ideas, and get to know each other on a personal and professional level. The luncheon will be held at the Summerfield Resort on December 1, 2017 and CEOs who would want to be part of this extraordinary event are encouraged to contact the FSE&CC earlier as space is very limited.

  • The Implications of the e-Government Communication Strategy to Business

    The Voice of Business applauds the recently launched e-Government Communication Strategy by the Honourable Prime Minister Dr. Barnabas Sibusiso Dlamini. […]

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    The Voice of Business applauds the recently launched e-Government Communication Strategy by the Honourable Prime Minister Dr. Barnabas Sibusiso Dlamini. The Strategy comes at a time when the quest for effective and efficient delivery of services by Governments to its citizenry and private sector is at the highest.

    The ‘information age’ demands that conducting business, either in the public sector or private sector, must be done in an effective and efficient manner in order to remain relevant. This era demands that services be measured in terms of value for money, be it terms of time spent whilst accessing the service or the quality of the service being accessed. It is no longer tenable for citizens to endure service delivered thorough the traditional frequent physical visits to offices; citizens are no longer prepared to spend long hours waiting for services that are anchored on a paper-based system. The modern citizens want fast and efficient systems available at the click of a button. Today’s businesses and citizens are no longer interested in the faces and names behind the bureaucratic structures and processes which deliver services that they are entitled to. There is a general common understanding that Governments exists to deliver these services. That the Government of Swaziland has woken up to this reality is highly commendable and applauded.

    However, this comes with new challenges for the country:

    Has the Government put in place reliable and effective infrastructure to deliver these services; what measures are in place to monitor if indeed the services are delivered in an effective and efficient manner; has Government prioritised which of those services will benefit business and grow the economy of the country; how will duplications of efforts (manual and e-based) be managed; how will Government ensure that the cost of doing business will not be transferred to business and the citizens.

    Many developed countries have leveraged on e-Government service delivery modes to become competitive. Physical boundaries are no longer an impediment to national development; information and knowledge are no longer restricted to a few privileged people. Governments and the private sector in these countries provide customer-focused, cost effective, and easy-to-use services through electronic means. Internal government processes and workings of these countries are e-based.

    Suffice to mention that to achieve the objectives of the e-Government Strategy, it is important that there is adequate investment in information technology infrastructure and skills; availability of the latest technology; readiness of individuals to use internet and other technology-based software; affordable of fixed and mobile broadband subscriptions; adequate and reliable internet bandwidth.

    The 2015-16 Global Competitiveness Index ranks Swaziland number 98 out of 140 countries, in the pillar of Technological readiness. Granted, much has happened since 2016, but until the next Index is published, Swaziland remains at number 98.

    It is for this reason that The Voice of Business strongly encourages and urges the Government, the business community and citizenry at large to take seriously this Government initiative and work together to improve the country’s ranking and the ease of doing business through electronic means. The Voice of Business opines that access to internet and reliable connectivity thereto still remains a big challenge; the cost of using data to do business is still very high. The Global Competitiveness report 2015-16 ranks Swaziland at 131 in Internet access in school out of 140 countries, globally. This poor ranking is evidence enough that information technology (IT) skills development and knowledge transfer have not yet been prioritised in all the country’s centres of learning.

    Lastly but not the least, changing the nature of Government and the need for Government Ministries to view business and citizens as major stakeholder and ‘clients’ in the administration and delivering of public services is paramount for this Strategy to be a success. This is highly critical taking into consideration the fact that the Global Competitiveness report asserts that inefficient government bureaucracy is the most problematic factor for doing business in Swaziland.

    Going forward, and as a turning point in our economy, the adoption and integration of digital technology into our daily lives, at home, at work, at schools and at play should be the way to do things. E-Government should not merely be about building websites and posting government’s data/forms on these. It should be about re-organizing government processes and services, promoting better relationships between government to government (G2G), government to business (G2B) and government to citizen (G2C), where technologies are an enabler to foster an information- and knowledge-based society.

    The Voice of Business believes that with the appropriate regulatory framework, the e-Government Communication Strategy will enable a much easier, transparency and accountable Government where public misinformation and anxieties will be minimized through effective interaction between the people, businesses and Government. This in turn will help in building a more cohesive society; it will help in consolidating peace and in strengthening the country’s security which is a vital factor in improving the ease of doing business in Swaziland.

    ILO Calls for Greening Production in a Changing Climate

    As countries across the world seek to mitigate climate change through agreements such as the Kyoto Protocol and Paris Accord, some critics believe that such efforts take a toll on local jobs and manufacturing production. […]

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    As countries across the world seek to mitigate climate change through agreements such as the Kyoto Protocol and Paris Accord, some critics believe that such efforts take a toll on local jobs and manufacturing production. But International Labour Organisation (ILO) Director General Guy Ryder believes that economic growth and climate protection are not mutually exclusive.

    “The world does not have to choose between job creation and preserving the environment. Environmental sustainability is a must, including from a labour market perspective,” said the official in a speech last week. “True, on the way to a more sustainable economy many types of jobs that exist today – especially in highly polluting or energy intensive activities – will disappear. Others will be replaced or adapted. But new jobs will be created as well,” he added.

    Ryder’s recently released “Working in a changing climate” report said that a shift from privately owned car-centred systems to metropolitan public transit and intercity rail, may result in job cuts in vehicle manufacturing and servicing, as well as fuel distribution. But it also said the operation and maintenance of public transit systems will require a “substantial” workforce.

    The report aims to make a balanced assessment of what climate change mitigation and adaptation means for the world of work. It outlines the challenges and opportunities involved, and how the ILO can contribute to the just transition to environmental sustainability that will serve to advance both decent work opportunities for all and the protection of the planet.

    It notes that there is “a great deal of evidence” that the transition to an inclusive green economy can act as “a new engine for growth and a strong driver of decent work creation in developing, emerging and advanced economies.”

    The report further underlines that the challenge is “to ensure that the potential decent work dividend of the fight against climate change is indeed realized,” stressing that the transition can be “abrupt and damagingly disruptive” if unplanned. The report also points to research findings suggesting that the impact of climate change responses on employment can be positive, with “strong potential for job creation” in the agriculture, forestry, energy, recycling, building and transport sectors.

    On the ILO Green Centenary Initiative, the report recalls that it was launched in 2013, and that its rationale was “to promote the considerable potential for creation of decent work associated with the transition to a low carbon sustainable development path and to minimize and manage the inevitable dislocation that will accompany it.”

    The report features chapters on: decent work and climate change; challenges and opportunities; the Green Centenary Initiative; and the road ahead. It highlights linkages between the Sustainable Development Goals 8 (decent work and economic growth) and 13 (climate action).

    Citing figures from the UN, the report added that a shift to more sustainable practices in agriculture has the potential to create over 200 million more full-time jobs in 2050, with growth coming from more labour-intensive green farming practices, research and development, and training of rural populations in the use of green technologies.

    “Greener economies can be engines of growth, both in advanced and developing economies. They can generate decent green jobs that contribute significantly to climate mitigation and adaptation, but also to poverty eradication and social inclusion,” said Ryder in his speech.

    Ryder added that the challenge is not just about creating more jobs, but also about the quality of those jobs. “Sustainable development must be pursued in full regard to its social and economic dimensions, not only its environmental consequences.”

    In Swaziland, the economy and source of income and livelihoods for the majority of the population who live in the rural areas (78%) is predominantly agricultural-based and climate change has had grave adverse effects. The country's development process is guided by the National Development Strategy and a series of rolling medium-term development plans geared at charting the transformation of the economy by 2022. In all the development initiatives climate change and climate variability have been considered an incremental threat to sustainable economy growth. Swaziland is also a signatory to 1992 United Nations Framework on Climate Change Convention (UNFCCC) and the 2013 SADC Climate Change Strategy that seeks to mitigate the impacts of Climate Change in the region.

    The International Labour Conference sets the broad policies of the International Labour Organization and meets once a year in Geneva, Switzerland. The annual “world parliament of labour” brings together more than 5 000 government, worker and employer delegates from the ILO’s 187 member States. This year, the Voice of Business was represented by President Andrew le Roux and Chief Executive Officer Bonisiwe Ntando.

    The President’s effort in improving the ease of doing business in Swaziland has been recognised in the international arena as he was elected the second vice-President for Business Africa. Business Africa is an international business organization headquartered in Kenya, Nairobi and seeks to enhance the business voice in continental bodies such as the African Union Commission, the ILO Regional Office for Africa, the United Nations Commission for Africa, the African Development Bank and other continental bodies.

    It has membership drawn from African employers’ organisations, to which the FSE&CC is part, spread out from over 40 countries from all the regions of the continent. Business Africa also seeks to strengthen regional integration to boost intra-African trade. The development of rail, road and energy projects through public-private partnerships to facilitate trade and business links is a key objective of the organisation.

    How relevant is our education system to labour market demands?

    The Voice of Business in Eswatini welcomes with excitement the great news that the University of Swaziland will, from August this year, be offering its very own Master’s Degree in Business Administration programme for business leaders in the kingdom. […]

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    The Voice of Business in Eswatini welcomes with excitement the great news that the University of Swaziland will, from August this year, be offering its very own Master’s Degree in Business Administration programme for business leaders in the kingdom. This is a milestone in the history of the university since its establishment in 1982 as it is through such programmes that Swaziland will produce leaders of business that will have the potential to compete in the space of business which is considered to be the engine of economic growth for our economy.

    The competitive business environment that has been marked by globalization demands that the country employs relevant educational programmes that are responsive to labour market demands in view of the high unemployment rate, currently at 41.8 percent, in Swaziland.

    Talking of unemployment, the Voice of Business is concerned by the current generation of young Swazi graduates leaving the education system which has gone into the labour market with more years of schooling and higher levels of qualifications yet they are struggling to find employment. The country’s unemployment statistics obtained from the Ministry of Labour and Social Security show that there are about 69 000 discouraged workers in Swaziland from a potential labour force of 295 236. These are people who have since accepted their fate of being unemployed citizens of Swaziland because they have tried in vain to look for a job. A majority of this population are university graduates with diplomas and degrees in various fields of studies ranging from humanities, law, to social sciences, to name a few.

    The Voice of Business in Eswatini considers education suitable if the graduates possess the knowledge, skills and attitudes that will enable them to realize their vision and to actively participate and contribute to the country’s economy. The person who is provided with that type of education cannot sit by the side unemployed. A proper education system should produce graduates who can be absorbed by the labour market. But the question is: how big is the labour market and what does it needs?

    It is an open secret that the sugar industry is and has for the past years, been the largest employer in the land yet our education system to date cannot offer courses relevant to the sugar industry in Swaziland. The country’s education system has continued to produce graduates using a supply driven education system as opposed to demands driven education system.

    In His ‘Speech from the Throne’, His Majesty King Mswati III spoke of the need to realize the full potential of our mining sector as a kingdom that still remains untapped. But the Voice of Business is yet to see a mining course offered by the country’s tertiary institutions. According to the Global Competitiveness Report Index, 2015-16, the country’s quality of education is ranked at 50 percent meaning there is still more that should be done to improve this average ranking. In Africa, the University of Swaziland is currently ranked 84 out of 200 universities, behind the University of Cape Town, University of South Africa and University of Pretoria, all of which are occupying the top three rankings.

    Compared with its regional counterparts in the SADC region, Swaziland has the second highest unemployment rate which currently sits at 28.1 percent. This is indicative of the fact that the Swazi education sector is not adequately responsive to labour markets and development needs. There seems to be no clear mechanism for monitoring sub-regional labour markets in which Swazi graduates could compete for jobs. It is the view of the Voice of Business that if tertiary institutions would have more employers and industry representation in the various education Councils, the issue of relevance of the courses they offer could be addressed.

    We all know that a country's manpower resources are an integral part of its wealth. We say so on many occasions, especially when addressing young people during graduation ceremonies, or in political speeches. Unfortunately, when it comes to following these words with action and giving education the relevance and the funding it deserves, we all too often fall short. This is something we have to change as a country. The skills and qualifications gained at university should help us build our lives and secure our societies' prosperity, competitiveness and progress.

    The country’s education system needs to stop trying to predict the future, but it should align and prepare young people for the change they will experience in the labour market. Tertiary institutions need to stop preparing young people for the jobs that existed a generation ago and start preparing them for jobs that will unleash the opportunities that the country has to improve its economy. For example, entrepreneurship education is much more important now than it was a generation ago because it teaches those skills and personal attributes which oil the modern labour market. The country should be able to attract international students who would like to enrol for courses they deem competitive in our national universities as opposed to sending students abroad for courses we should be offering as a country. For example, it is embarrassing for us as a nation that we do not have courses in our tertiary institutions that will enable our young graduates to fully participate in the mining sector; courses such as excavator training.

    It is critical that the Voice of Business in Swaziland, therefore, states that if the current, not particularly favourable, educational system is left unchanged, Swaziland will fail to fully embrace the opportunity of building a knowledge-based and skilled-based economy which is a basis for economic growth and, consequently, improvement of the standard of living of the citizens.

    Healthcare Fraud, waste and abuse remains a costly challenge to Members, Business and Government

    Like all institutions where money is used as a core enabler for health care provision, Medical Healthcare Programmes are not immune from fraudulent activities. […]

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    Like all institutions where money is used as a core enabler for health care provision, Medical Healthcare Programmes are not immune from fraudulent activities. Whilst the full extent of health care fraud cannot be precisely measured, it is estimated that internationally the average fraudulent losses to public and private health care programs can easily add up to three to ten percent (3–10%) of the total health care spending bill.

    The above statistics were raised as serious concerns during the 18th Annual Conference of the SADC Board of Healthcare Funders’ (BHF), held in Cape Town on 17th to 19th July 2017. The Conference greatly benefitted from various presentations of reputable international and regional experts on healthcare provision, who ably shared the risks associated with this industry.

    All presenters acknowledged that efforts to curb fraud in the healthcare industry, require aggressive, innovative and sustainable methods and cooperation from all stakeholders in the various entities of the healthcare sector. Governments and the private sectors were encouraged to closely work together to ensure that the healthcare sector becomes more efficient, reliable and accessible to users and beneficiaries.

    An opinion was advanced at the Conference that the private sector needs to collaborate and partner with law enforcement authorities and health funders to curb criminal and fraudulent activities in the healthcare sector.

    Data generated by the Board of Health Funders (BHF) showed that in South Africa alone about seven (7) percent of all medical aid claims are fraudulent. It was estimated that between 2009 and 2013 fraudulent claims costs the South African National Health Department about R22 billion a year and about R24 billion in irregular expenditure was recorded for regional health departments.

    A South African senior clinical adviser at Medscheme’s forensic unit, Gregory Pratt, says fraud and abuse posed a material threat to the affordability and sustainability of medical aid schemes, and to any national insurance scheme. He submitted that there appears that there is a culture of entitlement among service providers who sometimes charge triple the amount for patients who suffered a condition covered under the prescribed minimum benefits. He cited a psychologist who had charged R4.3 million in 102 days; pharmacies who had claimed more than R100 million in three days and more than R5 million being paid to a radiographer in one year, as examples of how practitioners abused the system. These staggering figures may be extrapolated to the Swaziland Healthcare environment to estimate the impact of fraud in the healthcare sector.

    The Conference highlighted that the impact of fraudulent activities, i.e false and inflated claims, goes beyond cost; it also impact the quality of health care provision. The health and wellbeing of patients can be jeopardized when they are exposed to unnecessary and dangerous tests and procedures. Some patients have become "paper pawns" through fabricated histories that threaten their future insurability.

    The majority of healthcare claims are submitted electronically. Due to the sensitivity of health matters, claims are usually processed based on predictable edits applied to representations on the claim, and paid on a claim-b-claim basis with limited verification that the services were actually provided or were necessary. Additional analysis is needed to determine whether a series of claims, each of which may appear legitimate by itself, demonstrates a pattern of potential fraud or abuse when taken together.

    Perpetrators see healthcare fraud and abuse as a low-risk crime. The insurance industry offers an abundance of easy targets. Claims operations are geared toward processing massive amounts of claims efficiently and rapidly—with a focus on coding, not fraud. Electronic data exchange and other technological advances can present another kind of exposure for payers and patients to creative new schemes to defraud the system.

    Ignoring fraud creates risk, allows the problem to grow unchecked and increases avoidable pay-outs. This leads back to the individual health funder as premiums for health cover are increased unabatedly.

    The view of The Voice of Business in Eswatini is that healthcare funding deserves urgent attention. Any amount of money lost due to fraud is money wasted; money that could have been used to keep premium rates in check and money lost towards improving patient care. It is incumbent upon all stakeholders in the healthcare value chain to minimise and curb healthcare fraud and abuse. Full-scale anti-fraud and abuse programs need to be put in place to minimise drainage of healthcare funds and resources.

    Responsibility, ownership, and consequences for fraudulent actions must cross the continuum at the level of individual health care user; healthcare beneficiary, healthcare service provider, at organizational, national and regional levels. Providers as well as consumers must be committed to providing appropriate documentation to address fraud and abuse cases and take a moral and ethical stand against fraud in the healthcare environment. This may mean taking advantage of the whistle-blower laws to identify fraudulent claims to the appropriate national authorities. Healthcare providers and organizations must invest in offering education and training programs, creating coding and fraud and abuse committees, and utilizing data mining and modelling software.

    Finally, the government must be diligent in prosecuting providers, healthcare organizations, manufacturers/retailers, and individuals who commit fraud and abuse in an organized and systematic manner. Although the vast majority of doctors are honest and committed to their patients’ welfare, fraud schemes often exploit the trust relationship between doctor and patient. Regrettably, for a small number of doctors, ethical duty sometimes becomes subordinate to financial self-interest. Doctors who solicit or accept kickbacks, whether in the form of a cash bribe, an inflated return on an investment, or a sham consulting or other agreement, do so at the expense of the patient and the system.

    Health and The Economy: A Vital Relationship

    Good health of a country’s citizenry is in a majority of cases highly dependent on the provision and accessibility of quality healthcare services and systems. […]

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    Good health of a country’s citizenry is in a majority of cases highly dependent on the provision and accessibility of quality healthcare services and systems. The provision of such services and systems is in turn strongly dependent on the performance of a country’s economy. These links can never be divorced and should never be underestimated. Investment in health facilities, systems and services is not only a desirable, but also an essential priority for developing societies. On the one hand, as a country, we are faced with tough and complex challenges, in part derived from new pressures, such as ageing populations and a growing prevalence of various chronic illnesses. On the other hand, we are reliable informed that the Ministry of Health, which is a provider of affordable healthcare systems and services in the country is faced with various challenges, including limited health care personnel, limited availability of drugs for chronic diseases and expensive health technologies, which are expensive to maintain and sustain. The business community, in particular, is faced with the challenge of dealing with higher expectations from its workforce in providing health services to meet their health needs as disease could hinder workplace productivity and overall business performance.

    The bigger challenge however, is to how to harmonise national health and economic policies to improve and provide affordable health services. Neither Government nor the business community can do this alone. Organised labour and other players in communities need to come together with the common vision of improving the health of workers and families, which in turn will improve productivity and ultimately the country’s economy.

    Success in improving the health status of the nation cannot be fully achieved unless efforts of all sectors are brought together and focused on achieving an improved health status of the people. This calls for all Government Ministries within the country to proactively engage employers on strategies to be employed in improving Swaziland’s health systems and services. For example, the Ministry of Finance, would have to put into perspective, through the National Budget, strategies to meet the demands of the country’s health issues on the national resources. Health issues need to be addressed at the macroeconomic planning level, so that they are well reflected in poverty reduction strategies and medium-term expenditure frameworks. Ministries of Labour and Social Security, Education and Public Service need to work in harmony on issues of conditions of work, health worker training and retention of health service providers; access to drugs and other supplies; and, with increasing decentralization, working with the country’s local government.

    It is close to being impossible to achieve national and international goals – including the much talked about Sustainable Development Goals (SDGs) – without greater and more effective investment in health systems and services. While more resources are needed, employers are making do with existing resources to provide affordable and efficient healthcare services to workers and their families and the communities around them. From the Government side, improving efficiencies and providing an effective National Health System can play a significant role towards improving the country’s health status and workforce productivity and economy.

    A number of members of the Federation of Employers and Chamber of Commerce, The Voice of Business in Eswatini, such as the Royal Swaziland Sugar Association (RSSC) and Ubombo Sugar, have risen to this challenge, by providing subsidised health facilities and services in their respective workplaces. Other employers within the Federation also provide medical aid care coverage for workers and their dependants to enable access to health services.

    Since June 2016, the Financial Services Regulatory Authority ruled that employers with groups of 30 or more medical aid members may not be prevented from subscribing to more than one Swaziland domiciled Medical Aid funder. This ruling combined with several other recent changes in medical aid structures and the benefits available means medical aid costs are likely to start coming down and more medial insurance products becoming more accessible. Hence, the Voice of Business encourages its members and the entire private sector to make smart options in selecting medical aid cover for their workers and dependants. This means learning more about the company’s medical aid benefit options with a view to containing or reducing health funding costs and increasing the value for money for services received.

    The Federation of Swaziland Employers and Chamber of Commerce (FSE & CC), as a pro-active advocate and supporter of best employment practises, in collaboration with HealthCare Insurance Brokers (Swaziland) (Pty) Ltd, an independent Broker in the medical aid field, is on a drive to help expand knowledge and understanding of medical aid options to employers and workers. There are already four health funders and healthcare insurers which are registered with the Financial Services Regulatory Authority in Swaziland, which provide managed healthcare funding and services. These are SwaziMed, where a majority of workers are subscribed by their employers, Momentum / Metropolitan Swaziland, SwaziCare and Mpilwenhle.

    Workers and business owners are encouraged to undergo annual medical check-up to ensure a healthy nation.

    Full Involvement of the Private Sector is vital in achieving SADC Agenda

    On 19th and 20th August 2017, heads of state and government (HOSG) of the Southern African Development Community (SADC) convened in Pretoria, South Africa, for the 37th Ordinary SADC Summit. […]

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    On 19th and 20th August 2017, heads of state and government (HOSG) of the Southern African Development Community (SADC) convened in Pretoria, South Africa, for the 37th Ordinary SADC Summit.

    The Ordinary SADC Summit was preceded by a series of meetings by SADC Standing Committee of Senior Officials (10th – 13th August), SADC Finance Committee (12th August), SADC Council of Ministers (15th – 16th August) and SADC Double Troika (18th August). There were also several multi-stakeholder workshops / conferences / exhibitions that took place in preparation for the Summit including the Industrialisation Week from July 31st to August 4th, held in Johannesburg, South Africa. This year’s Summit took place under the theme ‘Partnering with the private sector in developing industry and regional value-chains’, highlighting the significance of involving the private sector in implementing and achieving the SADC’s Industrial Strategy and Action Plan, and developing regional value chains.

    The Voice of Business notes that the private sector is an important driver for regional economic integration and development, therefore its active and increased participation in SADC’s socio-economic projects is necessary. SADC admits that private sector involvement is crucial to the advancement of the region’s trade and investment, employment creation, infrastructure and transportation, agriculture and food security and tourism. Article 16A of the SADC Treaty requires member states to establish National Committees consisting of key stakeholders from the private sector, government, civil society, non-governmental organisations, workers and employers’ organisations. The Committees ‘provide inputs at national level in the formulation of regional policies and strategies, as well as coordinate and oversee the implementation of programmes at national level’ and ‘are also responsible for the initiation of SADC projects and issue papers as an input into the preparation of the Regional Strategies.’However, active private-sector participation at regional level is still limited in SADC and Africa at large.

    At the Summit, the HOSG discussed several issues including industrialisation and regional integration. They emphasised that member states should operationalise the theme through the implementation of projects with focus on agro-processing, energy, pharmaceuticals and mineral beneficiation projects, boosting skills to enhance regional integration and to create mechanisms to increase private participation. The leaders also urged member states to mobilise resources and operationalise the SADC Regional Development Fund to support and drive the industrialisation agenda. Member states were also urged to partner with the private sector in developing industry and regional value chains.

    The Summit also noted progress in the implementation of the Industrialisation Strategy and Roadmap 2020-2063 in specifically profiling value chains in the three priority sectors of agro-processing, mining and pharmaceuticals and urged member states to keep the momentum and develop and actualise the identified value chains.

    SADC leaders also approved the Protocol for the Protection of New Varieties of Plants in the SADC Region, 2014. The Protocol will provide for the establishment of an effective system of plant variety protection, promote the development of new varieties of plants for the benefit of the region and protection of breeders’ rights (Article 2). It will enter into force after being signed and ratified by two thirds of the member states, and will become legally binding on state parties. The Protocol has been heavily criticised by civil society organisations and small farmers who argue that the legal instrument is inflexible and restrictive to individual member states and to the detriment of small farmers.

    Regarding continental integration, SADC leaders underscored that the Continental Free Trade Area (CFTA) should find expression in the work of the Tripartite Free Trade Area (TFTA). That is, the objectives of the CFTA must be reflected in the creation of the TFTA. The CFTA, expected to be launched in December this year, is intended to create a single continental market for goods and services, with free movement of business persons and investments, and thus boost intra-African trade. The CFTA negotiations are divided into two phases. Phase I (on-going) covers trade in goods and trade in services, while phase II will cover investment, intellectual property and competition issues.

    At the Summit, Comoros was admitted as a new member of SADC, bringing the region’s membership to 16. Comoros is also a current member of the COMESA and Economic Community of Sahelo-Sahelian Countries (CEN-SAD). Burundi’s application to join SADC is still being assessed.

    It must be emphasised that developing industry and regional value chains in SADC is important. Especially considering that the region is predominately viewed as a producer and an exporter of raw products and an importer of value-added products. Industrialisation and regional value chains are crucial to the achievement of SADC’s regional and continental integration agenda. In addition, these goals can be achieved with significant involvement of the private sector.

    SADC has adopted an array of critical agreements which have not yet entered into force including, inter alia, the New Protocol on the SADC Tribunal, the Protocol on Trade in Services, the Protocol on the Facilitation of Movement of Persons, and the Protocol on Science, Technology and Innovation. SADC member states were urged to sign, ratify or accede to the Protocols at the previous Summit, but nothing has been done so far. These issues were not discussed during this year’s Summit either. In this context, it is also important to stress that mere adoption of several agreements or policies is not sufficient for bringing about effective economic development in the region. Implementation is equally important. Thus, strong political commitment on the part of government to implement the relevant agreements and policies are necessary for achieving SADC’s agendas.

    FSE & CC Also Calls for Liberalization of the Information, Commutation and Technology Industry to Increase Country’s Competitiveness

    Liberalization of the telecommunications sector has been taking place in industrialized and less developed countries (LDCs) alike, as part of broader economic reforms initiated in the 1980s. […]

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    Liberalization of the telecommunications sector has been taking place in industrialized and less developed countries (LDCs) alike, as part of broader economic reforms initiated in the 1980s.

    On Monday 14th August 2017 Honourable members of Parliament moved a motion which seeks to amend the Swaziland Electronic Communication Act (2013). The amendment would remove the monopoly of the national electronic and telecommunication backbone infrastructure from the one entity, Swaziland Post and Telecommunications Cooperation (SPTC), and allow other players to participate in providing a gateway for electronic communication, thereby fully liberalising the ICT industry.

    The Voice of Business in Eswatini, the Federation of Employers and Chamber of Commerce (FSE & CC), welcomes and supports this Motion and is convinced that the current legislation as it stands, in particular Section 53 of the Electronic Communications Act (2013), is in direct conflict with the National Information, Communication and Technology (ICT) Policy and the Government of Swaziland’s Investor Road Map Strategy.

    The communications industry is amongst the most innovative and rapidly growing sectors of modern economies. Besides the direct contribution the sector makes to economic growth and development, it also plays a key role in the performance of other sectors within an economy. This is because it is an important intermediary in production, and the infrastructure on which the information age is being built.

    The attitude of most governments towards the industry has changed, with a growing consensus that the days of national monopolies are over and that the sector must be opened to private competition if it is to flourish. According to a 2006 report from the Groupe Special Mobile (GSM) Association, poor regulation has reduced telecommunications investment in Africa by US$4.6 billion.

    In Swaziland, concerns have been raised that liberalising the backbone infrastructure, specifically the international gateway, would compromise the country’s national security. In 2008, the International Telecommunications Union (ITU) stated that “security concerns raised on liberalisation of the international gateway are unfounded”. This information is contained in the 2008 ninth edition of the ITU publication “Trends in Telecommunications Reform”, titled ‘Six Degrees of Sharing’.

    The Voice of Business believes that there are existing international guidelines which the Swaziland Communications Commission (SSCOM) as a regulator could adopt to address any concerns which may arise on national security. These guidelines are further intended to provide an overview of the licensing and regulatory framework for applicants seeking to obtain licences to establish, maintain and operate International Gateway Services.

    It is undisputable that Swaziland is losing out on a number of economic and social benefits due to the high costs of telecommunications. According to the 2016 Global Information Technology Report, out of 139 countries, Swaziland is ranked as follows:

    • 118 in ICT use for business-to-business transactions
      135 in business-to-consumer internet use
      124 in Government Online Service Index (this limits the capacity of the Government of Swaziland to improve service delivery including efficient revenue collection)
      131 on internet access in schools;
  • The global rankings highlight the opportunity to improve the ICT Sector, which the Voice of Business believes would reduce the costs of doing business and simultaneously improve the ease of doing business.

    Based on Global Competitiveness Report 2016 and the Global Information Technology Report 2016, FSE & CC developed the table below to analyse Swaziland’s standing and ranking in relation to other SADC countries in relation to ICT affordability and market penetration:

    It stands to reason that the country would derive huge benefits from reduced telecommunication costs and these include, but are not limited to:
    • A lower cost of international bandwidth in the country, due to the entrance of new players to the market, as well as the subsequent pursuit of operational efficiencies from the current wholesale.
      A lower cost of retail broadband services, whether fixed or mobile, following the cost reduction in international bandwidth. Service providers may, however, take advantage of this cost reduction to increase their margin and this is where the role of the regulator becomes important.
      A better quality of service for end users because the competition would push the operators of international gateways to improve the quality of their services, compared to a monopoly situation. There has been a visible reduction in mobile costs with the introduction of a second mobile operator
      A more dynamic telecommunication sector, with more diverse players and offers for end users, more investment from players, more demand for broadband services and more innovative services:
      Better quality and lower cost of broadband solutions would attract more customers, leading to more revenues for the Service Providers, but also for the wholesale players, including more revenues from the incumbent’s backhaul network.
      Higher revenues for retail providers and the arrival of new entrants in the market would lead to a higher overall investment in the telecom sector.
      On a medium-long-term perspective better quality and greater affordability of broadband services will attract international companies to invest in not only the telecom sector, but other industries as well. The availability and affordability of quality broadband solutions are key criteria in the decision of international companies to invest in a given country.
      Increased revenues and investment from the telecom sector will also translate into higher tax revenues for the government, more employment opportunities, better services and positive spill over effects in other sectors as well as improved delivery of social services.
      Improved education services which translates from the increased internet access in schools and homes and ultimately a labour pool with improved research skills and innovation.

  • The Voice of Business wishes to expressly state that it shares the view that competition brings about operational efficiencies and innovation.

    Against this backdrop, the Voice of Business encourages the Government of Swaziland to support SPTC, a nation-owned entity, to become more efficient as a service provider. Such efficiency can be achieved by the finalisation of the ‘unbundling’ process of SPTC into the proposed three separate entities and by allowing these entities to be partly or fully privatised for the purpose of capitalisation, which is consistent with the ICT Policy. Other industry players should then be able allowed to establish and invest in their own gateways infrastructure, if they so choose, to support their own business activities. FSE and CC, as the Voice of Business, therefore calls upon the Executive arm of Government and subsequently Parliament, to expedite the unbundling of SPTC in order to usher in a fully liberalised ICT industry.

    Increased liberalisation of the ICT sector would increase competition, create greater customer choice and improve the quality and efficiency of the products and services offered. It would reduce the price of communication technologies, making it more affordable and more widely accessible for all. It would further increase market growth, enhance ICT infrastructure and speed up the rate of innovation, moving Swaziland towards the much anticipation position of being one of the first world countries.

    Fitch downgrades South Africa to junk status: what’s in it for Swaziland?

    Fitch has become the second major rating agency to downgrade South African rating to junk status, cutting both the foreign currency and local currency ratings by one notch on concerns[…]

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    Fitch has become the second major rating agency to downgrade South African rating to junk status, cutting both the foreign currency and local currency ratings by one notch on concerns that recent political events, including a major Cabinet reshuffle, would weaken standards of governance and public finances and is likely to result in a change of economic policy direction.

    Firstly, "junk status" from ratings agencies is a way of telling investors that the quality of the bonds of a government is not the best. And that there is risk of investors not receiving all the interest or the value of the bonds back when it matures. Simple economics 101 asserts that increased risk implies investors require increased rewards. Thus the yield (interest rate) that South African government has to offer on money it is looking to borrow by issuing government bonds has to be higher to compensate investors for taking the increased risk of buying the government’s bonds.

    This would then lead to the South African government cost of borrowing shooting up. More money has to be spent on repaying interest. Money that could be used for social upliftment projects, improved infrastructure, fighting crime, social grants etc. This would also result to a situation where more money spent on interest is more money not being spent in South Africa on South Africans. The overall impact of this is a poorer quality of life and slower economic growth.

    So what is next? Since investors know that a downgrade to junk will set off the chain of events we mentioned above, they start looking elsewhere around the world for economic growth and higher returns on their investments. This leads to a depreciation of the exchange rate as the demand for Rands fall as investors are less keen on investing in South Africa and would rather go elsewhere. A weaker exchange rate means South African imports would become more expensive.

    Since the Swazi Lilangeni is pegged to the Rand, this turn of events would put the Kingdom in the very same boat with South Africa with them being the major trading partner for the country, and Swaziland being a net importer. For example, imported essential commodities such as fuel become more expensive and this feeds through into higher prices as wholesalers and retailers pass the price increases on to consumers, leading to higher inflation. Higher inflation leads to higher interest rates as the Central Bank is likely to raise interest rates to try and curb spending which in turn they hope will lower levels of inflation. As consumers spend less, retailers and wholesalers will lower prices to move their goods faster, but this eats into their margins, which if sustained, will lead to job losses as wholesalers and retailers try and cut costs. For the export companies, while it is likely that a weaker exchange rate in Swaziland's exports becomes more competitive, the overall impact in the economy is negative nonetheless. The country’s net effect is a greater trade deficit, that is, Swaziland pays more to the world for its imports than what the world is paying it for its exports.

    Business owners, senior managers and company executives need to prepare themselves for a bumpy second quarter in 2017, with the only certainty being that nobody really knows how much the downgrade by rating agencies and the weaker Lilangeni will impact on the economy. Managing and running a business in turbulent times is very unsettling, understanding the environment we are operating in at the moment is almost impossible as it keeps changing from day-to-day. While it is not yet clear how the credit downgrades will impact on businesses, it is more likely that small and medium enterprises (SMEs) would be more affected by a weaker currency, higher inflation and difficulties attracting investment.

    Depending on the kind of business, the type of industry and its dependence on the current economic climate, the key aspects of business model innovation might be different from one business to another. For a car wash owner, for instance, having to deal with a severe drought and water restrictions might mean innovating on the resources side of the business model and finding alternative ways of washing cars, such as water-less products.

    For the average consumer the following scenario is likely to occur, thus it becomes imperative the individual household increase their levels of personal savings in order to cushion the likely increasing in debt repayment caused by higher interest rates.

    As the country descends further into economic uncertainty, businesses would do well to revisit their business models and ensure their companies are able to adapt to whatever comes their way. It may not be known what is coming next, but businesses can ensure that they are better prepared and that their companies are able to survive any potential stormy market weather.

    Entrepreneurship: A shift towards self-dependency

    From time immemoria, young people were being encouraged to go to school and acquire qualifications which would in turn increase their chances of securing a good paying job.[…]

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    From time immemoria, young people were being encouraged to go to school and acquire qualifications which would in turn increase their chances of securing a good paying job. This gospel was true until there came a time where government and the private sector could no longer absorb all graduates into their systems. This has unfortunately resulted in high unemployment rates.

    Despite strengths such as favourable location and climate, good infrastructure, diversified production base and skilled labour force, since mid-1990s Swaziland has been one of the least growing countries in Africa. Specifically, at 2.3% average annual growth rate during 2001 – 11, Swaziland’s economic growth was well below the average of the sub-Saharan Africa (5.8% a year). The slow growth was accompanied by low job creation. The 2007 and 2010 Swaziland labour force surveys revealed an unemployment rate of almost 30% of the labour force – one of the highest among Africa’s middle income countries. 63% of the population lived below the poverty line, while 29% lacked food security in 2010.

    During this same period, many business ideas have been conceived; however, they have not seen the light of day because of the lack of, or difficulty in accessing the necessary capital and the cumbersome procedures of acquiring licenses to operate. It is commendable that the Government has made company registration a lot easier now through the recently launched e-Government Communication Strategy. This is one of the barriers that has for a long time discouraged potential entrepreneurs to establish businesses in the country.

    In increasing employment opportunities in the country, it is also commendable of the government to launch the Graduates Enterprise Programme (GEP) which is a programme facilitated by the Small Enterprises Development Company (SEDCO). The programme is aimed at creating job opportunities for graduates from institutions of higher learning who have not been absorbed by the formal job market in Swaziland. It is expected that the programme will increase indigenous employment and will stimulate growth in communities. It is hoped that a total of 240 business entities will be established through this programme, and the graduates have been encouraged to employ at least three people in the businesses they will set up. Overall, it is expected that these establishments will create over 800 jobs.

    It is also commendable that this programme will not only offer the necessary collateral to get these businesses off the ground, but the programme will also provide capacity building and mentorship. These two are very vital for the success of a newly established business. One of the most important benefits of having a mentor as you venture into business is the ability to use your mentor as a sounding board in evaluating your ideas and thoughts on major business decisions. Having the assistance of someone who has been in the field of business for a long time helps you avoid wasting time on concepts that your mentor has already tried and failed or in some instances succeeded. Whichever way, you gain from talking ideas out before implementation. The programme will also follow up on these businesses after they have been established to ensure that they succeed.

    The Voice of Business acknowledges and supports this spirit of entrepreneurship that our government has embraced as one of the most important inputs in the economic development of this country. Developing countries such as Swaziland need entrepreneurs who are competent to perceive new opportunities and are willing to take risks in exploiting available opportunities. The Minister of Commerce, Industry and Trade Jabulani Mabuza speaking during the (GEP) seminar, made it clear to the graduates that becoming an entrepreneur is a very challenging task and it requires dedication and hard work. Entrepreneurs need to be passionate about their businesses and be willing to go the extra mile to see the success of their businesses.

    As it is, the unemployment rate in Swaziland stands at 42 percent of the total labour force and the youth unemployment rate is at an alarming 51.6% of the population of young people aged between 18 and 24. This is according to the Labour Force survey of 2013/14.

    High unemployment rates hit hard on the business community as people have less or limited buying power and therefore cannot purchase goods or utilise services offered by businesses. This in turn has a negative effect on a country’s overall economic stance as well as social well-being.

    There are over 10 institutions of higher learning in the country which produce about 5000 graduates every year. This is too large a number to be absorbed into the work force. It is for this reason that the youth need to be empowered to establish businesses that will sustain them and their families. William Damon, Director of the Stanford Center on Adolescence once said, “Entrepreneurship is a proven pathway to prosperity and freedom.” Indeed, being able to generate income advances you to better living and leeway to explore other opportunities.

    However, it is imperative to reiterate the fact that newly established businesses can only survive and grow if the environment they are operating in is conducive. The Voice of Business commends that Government has taken the first step towards empowering our youth to become entrepreneurs through the GEP initiative. In a bid to attain Vision 2022, we further encourage Government to continue to make the business environment one that encourages, rather than discourage growth. This will definitely see the success of these 240 companies to be established and even the birth of many more other companies in Swaziland.

    Make it your business: Engaging with the Sustainable Development Goals

    Not so long ago, sustainability was seen as little more than a peripheral ‘green’ issue – useful for reducing energy and waste disposal costs or supporting some worthy community causes […]

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    Not so long ago, sustainability was seen as little more than a peripheral ‘green’ issue – useful for reducing energy and waste disposal costs or supporting some worthy community causes but hardly central to a company’s core business. That view has changed tremendously in the last few years.

    Increasingly, businesses from all sectors are having to confront and adapt to a range of forces including as part of globalisation: increased urbanisation, intense competition for raw materials and natural resources and a revolution in technology, to name a few. Business models of many sectors require companies to be more accountable and transparent to all their stakeholders. As a result, sustainability has moved from the corporate side-lines into the mainstream. Faced with a future of uncertain energy costs, concerns about access to raw materials and the scarcity of natural resources like water, business all over the world are alive to the reality that environmental sustainability is a key consideration for sustainability. As companies navigate this uncertain business landscape, having a cohesive vision of environmental and social sustainability will help them develop new models for growth and opportunities to be product, service and market leaders.

    There was no better time than the last five years for members of the United Nations to launch a Roadmap on Sustainable Development Goals (SDGs) - a roadmap for good business growth for the next decade. This era is momentous time for change. It could be a pivotal era in turning the tide on the major social, economic and environmental issues of our times. Within the provisions of the Sustainable Development Goals (SDGs), the way of doing business has to undergo a fundamental shift.

    The extent to which businesses embrace the importance of the SDG’s, and the level of understanding of companies of how achievement of the SDG’s can positively impact return on investment, may result in some of the SDG’s becoming a measure for good performance of a business.

    Take SDG 1 (End Poverty in all its Forms) as one example. It sits high on the UN priority list, but may be sitting low for businesses; businesses may currently be viewing SDG 8 (Decent work and economic growth) as top of its agenda. However, unpacking and linking the two SDG’s, shows that improving employment for all is a start to addressing one of the key causes of global poverty. It is therefore when one makes the right connections within the SDGs that one realises the interdependencies of the stakeholders in attaining the SDG’s and the benefits for all.

    It is true that the Government will want to measure and monitor progress and manage the effectiveness of their interventions in the implementation of the SDG’s. In turn, business will need to assess its impact on the SDGs and review its strategy accordingly. It will need to collect, assure and report new data, evolving its reporting too. It would seem sensible that a business for instance will want to know if business operations (across its value chain) support or detract from the Government’s goals. The SDGs put a spotlight on some of the world’s biggest issues and a country’s ability to shape our impact on them, for good or bad. This represents an opportunity for innovation and new market opportunities for the savvy business to embrace and drive growth and productivity.

    How can Government get the best from business to be able to report positive achievement of the SDG’s?

    The SDG’s need to be pitched to business in a way that resonates with business principles and can be easily interpreted and incorporated into normal business operations. After all, the investment involved for business should not be underestimated. Determining requirements, accessing the right skills and developing the right tools, is always top priority for business. Goal setting, strategy development, operational change and impact assessment is the language that business understand. Inversely, business will also need to rethink its strategy and change behaviours to evidence its contribution and, hopefully, be seen to contribute positively to the attainment of the SDG’s.

    So what is the starting point for business? How does this translate into action and next steps? For many, the best place to start will be to understand what impact a business is having against each of the SDGs, recognising that these all differ country by country. Then businesses need to understand, strategically, where operations and growth could support the government to achieve the SDGs and identify the opportunities for competitive advantage.

    The Voice of Business believes that when the business community aligns with the SDGs they will have a clearer view on how their business helps or hinders the government to achieve its goals, and the opportunity to evidence and maintain their license to operate. Such businesses will definitely have a competitive advantage over those companies that do not understand their contribution or use the knowledge to revise their strategies accordingly. Expectation is high that business will make a significant contribution to help government and society achieve the goal of realising the first world status by the year 2022. Smart businesses wanting to position themselves as supporters may consider planning now how they can take sustainability and put it at the heart of business growth to stay ahead of their competition.

    Energy to Drive Country’s Economic Growth

    The SADC Agenda on energy, is compelling the energy sector in Swaziland to undergo significant transformation, becoming more complex, with increasing costs. […]

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    The SADC Agenda on energy, is compelling the energy sector in Swaziland to undergo significant transformation, becoming more complex, with increasing costs. The required technologies to connect the region require a shift in the regulatory landscapes to meet the rising demand both at a national and regional level.

    For Swaziland to unlock the economic potential, the energy sector must deliver energy in an accessible, affordable, reliable and sustainable manner. There is need to reach new levels of capital and human resources development to move the energy sector towards more efficient business models with the least environmental impact.

    While this may be seen as a challenge, FSE & CC as the Voice of Business sees a number of opportunities for the country to optimize its energy options. Using lessons learned from other countries and technological progress made by other regions, Swaziland could make a significant turnaround and shift towards a cleaner and more affordable system of electricity generation and distribution.

    The Electricity Value Chain

    A simplified energy value chain could be presented as follows:

    Through this Value Chain, Swaziland has the opportunity to achieve a desired economic and social status. However, this is limited by the current inadequate infrastructure and conflicting policy directives in the energy sector.

    On the premise that there should be a general trade-off between the three classic energy objectives of security of supply, affordability and sustainability, which has long been recognised as a central dilemma, or ‘trilemma’, for any policy on energy, the Voice of Business believes that Swaziland can develop an optimal balance of central and distributed, conventional and renewable energy sources to meet the needs of the country.

    The energy supply that might be the most secure may not be the most affordable and/or the most sustainable and vice versa. The World Energy Council points out, “delivering policies which simultaneously address energy security, universal access to affordable energy services, and environmentally sensitive production and use of energy is one of the most formidable challenges facing government(s) and industry.”

    The Energy Trilemma

    The Ministry of Natural Resources and Energy (MNRE), through the Swaziland Energy Regulatory Authority (SERA) is currently in on a mission to develop a subsidy framework that seeks to move the country towards the implementation of a ‘cost reflective’ electricity tariff. The Cost of Supply study, conducted by the Swaziland Electricity Company (SEC) in 2013 revealed that the current average SEC tariff is around 41% below the long run marginal cost of supply. Additionally, it revealed that the current tariff structure does not reflect the marginal cost of supply for each customer category. This means that significant cross-subsidies exist among customer categories as shown below:

    From the graph, it is apparent that domestic users of energy receive a significant subsidy on the cost of electricity. The Voice of Business believes that it is against the tariff principles to reimburse wealthy households and such reimbursements cause significant distortions in the electricity market. Industrial and commercial users pay a higher tariff and support ‘wealthy’ domestic users, who may, for all intense and purposes, not need the subsidy. The Voice of Business is of the view that subsidies should target specific policy objectives and should target vulnerable customers only.

    In an effort to improve security and supply of energy and to reduce reliance on Eskom, the Government of Swaziland is also considering generating energy through the use of thermal power. If feasible, a thermal power plant would address the concerns around security of supply, but there is the unease on the possible negative impacts it might have on the environment. Furthermore, it may discourage Independent Power Producers (IPPs) form entering the market, due to the high capital costs required for renewable energy amidst the relatively small Swazi Economy.

    The Voice of Business will continue to lobby for policy coherence that is consistent with the country’s Vision 2022 Agenda. The recent media reports and public reaction to some of the proposed changes in the energy sector highlight the need for wider and in-depth discussion among all relevant stakeholders as the country seeks to define and move forward the ‘affordable, accessible and clean energy agenda’.

    The Voice of Business encourages the Government of Swaziland to nurture a favourable investment environment for the private sector in this sector. Additionally, Government, as a policy maker, and the energy regulator, should engage the private sector to make the governance and regulations around public-private partnerships clearer, transparent and independent in order to ensure that investors are confident and willing to commit and invest in long-term capital projects in this sector.

    Without seen to be competing with the private sector, Government should work together with the private sector and put in place measures to reduce risk and decrease the cost of capital, allocating risks to the most appropriate market participants in this sector. The public sector should proactively engage with the private sector to align expectations, profitability, innovative financing schemes and a balanced approach to local content requirements for this important sector.

    E250 000 Penalty for assets bought at Auction

    The Federation of Swaziland Employers and Chamber of Commerce, (FSE&CC) is extremely concerned about the article published in the Times of Swaziland newspaper on Wednesday, the 27th May 2017 titled “E250 000 PENALTY FOR ASSETS BOUGHT AT AUCTION.” […]

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    The Federation of Swaziland Employers and Chamber of Commerce, (FSE&CC) is extremely concerned about the article published in the Times of Swaziland newspaper on Wednesday, the 27th May 2017 titled “E250 000 PENALTY FOR ASSETS BOUGHT AT AUCTION.”

    If the article is anything to go by and to be believed, it was reported that the Swaziland Competition Commission’s (SCC) CEO, Ms. Thabsile Langa, pointed out that acquiring an asset, even at an auction sale, was a ‘notifiable transaction’, where it amounts to a merger in terms of the Competition Commission Act, 2007.

    She is reported to have encouraged businesses, in the event of uncertainty on whether or not a transaction constitutes a merger and therefore notifiable, to make a written request for a non-binding advisory opinion to the Commission. This request should detail the nature of the proposed business transaction. Alternative to the written request, uncertain businesses may request for a pre-notification meeting with the SCC’s mergers department to obtain any necessary guidance related to the merger notification procedures.

    It is not clear from the article, whether the information was given by the SCC at the request of the reporter or whether it was unilaterally volunteered by the SCC, as part of its advocacy functions. Whereas such information is welcome, it must be noted that FSE&CC, as the ‘Voice of Business’ in Swaziland, is concerned by the uncertainty caused by the Act, in failing to clearly define what a notifiable transaction is, thus leaving it open to wide interpretation. It is further concerned by the manner in which the ambiguous provisions on notifiable transactions are interpreted widely by the SCC to include even transactions that were not intended by the legislature to be notifiable. In this case, businesses are left susceptible to the potentially bad interpretation of a bad law by the SCC.

    It is a rule of thumb in the practice of legislative drafting that legal provisions should be precise and not open to different possible interpretations and explanations. In defining a merger, particularly with regard to the acquisition of assets, Section 2 of the Competition Act, read with Regulation 3(1)(b) of the Competition Commission Regulations, 2010 fails dismally in achieving this standard. It is therefore, not good enough for the business community to be told that every time they need to enter into a business transaction, they have to first seek the advisory opinion of the SCC. It should be clear from the legislation what a notifiable or non-notifiable transaction is. The fact that Government has openly demanded that its parastatals should pay back annual dividends to it, already gives rise to the suspicion that the SCC will not readily concede that a transaction is not notifiable, because its principal is inter alia, expecting it to make money from notification fees to either sustain itself and to declare any surplus made to Government as dividends.

    The fact that this relatively new Act, the Competition Act, 2007, is already under extensive review is admission that it has significant disparities. The question therefore becomes, can a business be prosecuted for the violation of a provision which the SCC itself, albeit by default, admits to be vague. The above confusion which the ‘Voice of Business’ believes is self-created, is caused by the fact that, whilst other jurisdictions, have elected to have thresh-holds for notifiable transactions, Swaziland has opted to make every merger transaction notifiable. This has inevitably, increased the administrative burden on businesses, which have to consult the SCC before they purchase an asset such as machinery or land, to ascertain if such an intended transaction constitutes a merger. This status quo, invariably results in negative investor perception. This is contrary to Government’s goal of improving Swaziland’s rankings in the annual Ease of Doing Business Report and the Global Competitiveness Report published by the World Bank and the World Economic Forum.

    In Swaziland all merger transactions are notifiable, with the exception that all small mergers, do not require the payment of the 0.1% percent notification fee. Small mergers are defined as those where the merging Parties have a combined annual turnover or combined assets of the total value of E8 million or less. All transactions involving parties above this thresh-hold pay the 0.1% notification fee. In South Africa the case is different, as small mergers, do not require mandatory notification even though the Competition Commission has the discretion to demand notification and approval of the transaction. Therefore, where the merging parties combined turnover or asset value is below R560 million and annual turnover or asset value of the transferred or target firm is below R80 million, the merger does not require notification as it is deemed to be a small merger.

    In Namibia, the thresh-hold for notifiable transactions is even higher, as the determining factors are both to be in existence before a merger is deemed to be notifiable, instead of it being a choice between two determining factors as in the above jurisdictions. For a transaction to be notifiable, the combined values (turnover and assets) of the undertakings involved must be N$30 million and above and the value (turnover and assets) of the transferred undertaking must be N$15 million or above. If either the N$30 million threshold or the N$15 million threshold is not met, the transaction is not notifiable to the Commission (i.e. it falls within a class of mergers excluded from Chapter 4 of the Competition Act).

    It should be noted that this response is limited to notifiable transactions, as discussed in the abovementioned newspaper article. The FSE&CC has formally raised its views on the whole spectrum of the Competition Act, 2007 and the current Bill which is under review, with the SCC in inter alia stakeholder consultations carried out last year and with the Honourable Minister of Commerce, Industry and Trade. Most recently, the FSE & CC has furnished the Ministry of Commerce, Industry and Trade and the SCC a detailed list of concerns and made input and proposals towards the amendment of the Act.

    It is in this regard that FSE&CC calls for a moratorium to be declared on all issues pending before the SCC on alleged notification violations, up until the legislative review is finalised.

    Companies urged to take up 'Sweat-Working' to get Swaziland’s Productivity on the Move

    From a highly esteemed national event that gathered multitudes of people from all walks of life – His Majesty’s 49th birthday celebration - the business community gathered at the Mavuso Sports Centre, the following day […]

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    From a highly esteemed national event that gathered multitudes of people from all walks of life – His Majesty’s 49th birthday celebration - the business community gathered at the Mavuso Sports Centre, the following day, on Tuesday 25 April 2017 to burn calories in an event aimed at promoting a healthier and productive workforce. Despite being a one-day event, the second FSE & CC Business Sports Day was a symbolic event where the business community and its workforce reminded themselves of the power to inspire, to heal, and to unite for the prosperity of our businesses.

    For those who made it to the event on Tuesday, they would attest that the spirit of teamwork and perseverance witnessed at the playing fields was one which saw employees from companies such as The George Hotel, Swaziland Water Services Corporation, Swaziland National Provident Fund, Manzini City Council, The Central Bank of Swaziland, SwaziMed, SRIC and LINAC dominating as winners in many of the sporting codes on the day. It goes without saying, therefore, that a team with shared vision, clear roles, and commitment to mutual success is the best.

    At a time when the world seems to be disagreeing about so much, sports is the one thing, apart from food, ironically, that can bring people together. Sports straddles all divides and brings together a nation and a people.

    The 2017 FSE & CC Business Sports Day was a culmination of an enormous collective effort which began early in February 2017, when the Minister of Commerce, Trade and Industry, Honourable Jabulani ‘Buy Cash’ Mabuza, officially launched the ‘Business Sports Day Event’.

    From that day, a number of companies and individuals, contributed in one form or another towards its success. The Voice of Business is indeed humbled by the support exhibited by the business community and would like to send its appreciation to all and sundry for the enthusiasm and assistance towards the success of the 2017 Business Sports Day.

    It is worth mentioning that whilst there may be a number of challenges that the business community has experienced in the immediate past within the Kingdom and beyond, it is humbling to see the support that was displayed by the Ministry of Commerce, Industry and Trade and the Ministry of Sports, Youth and Culture in ensuring that through sports, the Government of Swaziland can work with The Voice of Business in the mission of facilitating a conducive environment for businesses in Swaziland. The presence of the Ministers on the day of the event, was truly inspiring to both the business community and the Swaziland work force. The motivational address and challenge to workers and the business community to continue working hard and to create more jobs in the country was truly inspiring.

    The words of wisdom that both Ministers shared on the day of the event left the business community with a task to ponder and develop strategies on how to bring about a solution to the high unemployment rate currently afflicting the Swazi nation.

    For the benefit of readers of this informative column and the entire Swazi populace, the Minister of Commerce, Industry and Trade, Honourable Jabulani Mabuza challenged the Swazi populace to network and share business ideas that would foster the spirit of entrepreneurship in the Kingdom as opposed to people always relying on being job seekers. The Minister said the prominence of sports in national cultural events should cause everyone to think more deeply about how to collaborate in creating jobs which will grow the economy of Swaziland. He did acknowledge the fact that starting a business is not a piece of cake as he also had to overcome a myriad hurdles before he eventually became an established businessman. The Minister guided participants of the event that after participating in sports it is common that the brain becomes sharper and requires to be engaged. He cautioned that such engagement should be towards positive and economy-building activities instead of negative activities.

    Echoing the Minister’s words was Honourable Minister David ‘Cruiser’ Ngcamphalala who appreciated the platform provided by the Voice of Business in uniting businesses and workers in Swaziland through sporting activities. Ngcamphalala stated that he was particularly impressed by the skills, vigour and dexterity displayed by the participants in the various sporting codes which he witnessed. He confirmed that this exhibited the power of teamwork which is integral for the success and productivity of businesses.

    The Minister’s assertion is one that is embraced by the Voice of Business, which fully concurs that improved organisational productivity is underpinned by teamwork, a healthy workforce and healthy relations and linkages with other organisations. Hence, the importance of sometimes setting aside time for socializing as employers and workers through sports was critical, and would spur the nation towards 2022 in a healthy form.

    The Voice of Business is committed to facilitating similar events in the future where the business community will network with one another to share business ideas that are essential for the development of the Swazi economy.

    The Voice of Business sincerely thanks TZD Sports Management Company for partnering and making the 2017 Business Sports Day the success that it was. An even greater Business Sports Day is anticipated in 2018. Congratulations to all companies that were able to participate in the event and we urge businesses to continue with the spirit of teamwork witnessed at the Mavuso Sports Centre as they continue with their day-to-day duties in the workplace.

    To those who did not win in any of the sporting codes, we trust that next year they will be motivated to becoming champions of the 2018 Business Sports Day. “Coming together is the beginning; keeping together is progress; working together is success”.

    Are protests on the Public Enterprises Act, 1989 justified?

    The way that the issue of the protests is handled by the parties on the Public Enterprises Act (Control and Monitoring), of 1989 (hereinafter called the PE Act) is a real cause for concern for the Federation of Swaziland Employers and Chamber of Commerce (FSE&CC) […]

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    The way that the issue of the protests is handled by the parties on the Public Enterprises Act (Control and Monitoring), of 1989 (hereinafter called the PE Act) is a real cause for concern for the Federation of Swaziland Employers and Chamber of Commerce (FSE&CC). The concern is that this matter keeps on arising, without any end in sight, at the expense of its members, particularly those who are in the financial services and banking industries, who bear the full brunt of the protest actions through the loss of man-hours and compromised delivery, on a matter which they are not a party to nor have control over. In essence therefore, the private sector refuses to be a pawn in the running conflict between the labour formations and Government, particularly in this matter which is capable of resolution.

    It is perhaps necessary, for the benefit of the unacquainted, to give a background to this issue. On the 25th to 26th February 2016, the Trade Union Congress of Swaziland (TUCOSWA) engaged in a protest action, on three issues, which included the alleged negative effect that the PE Act has on negotiations between trade unions and Government parastatals. It is common cause, that during the mediation preceding this protest action, Government did write a letter to the International Labour Organization (ILO) seeking an opinion on this issue. At the height of the SADC Summit, TUCOSWA sought to deliver a petition on this issue to the Ministry of Finance on the 31st August 2016. This petition was subsequently delivered to the Ministry of Finance on the 24th November 2016, with the openly stated intention that it was a mere precursor to the reporting of this issue to the ILO.

    In December 2016, the Swaziland Union of Financial Institutions and Allied Workers (SUFIAW), an affiliate of TUCOSWA lodged with the Labour Advisory Board (LAB) two protest action notices, for a protest action scheduled for the three days preceding the week of the of the opening of public schools, being the 17th to 19th January 2017. One of the issues raised therein was, the demand for the amendment of the PEU Act, particularly Section 10(1)(e) thereof which reads, “No category A public enterprise shall do any of the following without the approval in writing of the Minister responsible acting in consultation with the Standing Committee:…make any major adjustment to the level or structure of staff salaries and wages or other terms and conditions of service of its staff.”

    Though the protest action was subsequently suspended at the last minute by SUFIAW, the latter has on the 28th February 2017 lodged a fresh notice for a protest action on the PEU issue, which is scheduled for the 11th to 13th April 2017, being the days preceding the Easter holidays.

    The position of the abovementioned labour formations is that Section 10(1)(e) of the PEU Act is inconsistent to the ratified ILO Convention 98 on the Right to Organise and Collective Bargaining. This is because the effect of the abovementioned proviso is that, no Category A public enterprise shall make any major adjustment to the level or structure of staff salaries and wages or other terms and conditions of service of its staff, without the approval in writing of the Minister responsible acting in consultation with the Cabinet Standing Committee on Public Enterprise (SCOPE).

    At this point, it is important to state that the position of the Voice of Business on this issue, is that it is capable of local and expedited resolution without the matter having to play itself out in the international arena. This can only happen if all the parties are committed to the resolution of the dispute and are engaging one another in good faith. Furthermore, it is appreciated that the solution to the problem raised by labour formations, may not necessarily be in the amendment of Section 10 of the PEU Act but it may be in reforming the practice by Government around this clause. In the absence of any best practice suggested by the labour formations, it appears that there is nothing wrong with Government trying to control human capital costs in public enterprises where it is a majority or sole shareholder. All governments definitely exercise this responsibility but the point of departure locally is in the “how.”

    It must be stated that, a recent development has been made in that the ILO has finally responded to the abovementioned letter written by Government in February 2016. It has confirmed the FSE&CC’s above position by pointing out that there is no evidence that Section 10(1) of the PE Act excludes collective bargaining and that ILO supervisory bodies have accepted that there should be a certain level flexibility with regard to collective bargaining in the public sector. It further cites paragraphs 1036 and 1037 of the Digest of Decisions and Principles on the Freedom of Association (5th ed), which in essence postulates that, in so far as the income of public enterprises comes from state budgets, it would not be objectionable after due consultation, for wage ceilings to be fixed in state budgetary laws, and that the Ministry of Finance should not be criticized for preparing a report on such ceilings prior to the commencement of collective bargaining. It is hoped that this advice from the ILO, will put an end to the incessant protests on the PE Act and that the parties will work together in refining the practice around same, lest the private sector be needlessly held at ransom once again on this issue.

    Swaziland Hosts SADC Annual Quality Awards

    The Kingdom of Swaziland was honoured to host the SADC Annual Quality Awards held at the Royal Villas on Wednesday, March 15 2017 […]

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    The Kingdom of Swaziland was honoured to host the SADC Annual Quality Awards held at the Royal Villas on Wednesday, March 15 2017. Whilst the Voice of Business and her members was also invited to witness this prestigious event that aimed at recognising and appreciating organisations and individuals who are contributing to quality advancement in all sectors of business, it is unfortunate that the invitation was received late and not enough members of the private sector could witness this event.

    The concept of Quality Awards was born way back in the 1980s by the Deming Prize (the first of its kind) and the EFQM Excellence and Malcolm Baldrige National Quality Awards. After the success of the Deming Prize in Japan, many local, national and transnational quality awards have been established.

    The SADC Annual Quality Awards forms the second level of recognition within the SADC Region for demonstration of quality improvement efforts. The first level is at Member States level where all SADC Member states are expected to implement the Awards. Historically Swaziland has not taken part, because we have no National Quality Awards. The Voice of Business is informed that the Ministry of Commerce Industry and Trade (MCT&I) together with other relevant stakeholders are putting in place logistics to ensure the inaugural Swaziland National Quality Awards later on in the year.

    Given the wide spectrum of industry, the awards are classified into various distinct categories aligned to specific operational standards. Some of the categories for which awards were conferred were the Quality Systems of the Year and the Product of the Year awards, aiming to recognise businesses that have product, quality systems, processes and procedures that are in line with local as well as international best practice. These businesses use quality principles as a tool for competitiveness for national and regional economic development. Zimbabwe was the overall winner, followed by Namibia as they took five of the seven awards. These winners are expected to be ambassadors for the Awards both in their domestic economies and in the region. They have the duty to represent the SADC Annual Quality Awards and keep doing more to continue to stand as deserving winners.

    But the main focus of today’s edition, is that during the Dinner, it was noted that a number of African countries do not have comprehensive Quality Infrastructure Policies in place to ensure supply of safe and quality products in the market. The SME Sector, especially, faces formidable challenges at the technical and quality level, over and above dealing with other issues such as logistics, financial challenges and management issues.

    Hence, in order to develop and produce products that are competitive and meet technical regulations in the regional and international markets, industry needs services of accredited national/regional quality infrastructure institutions that can provide the required independent evidence of compliance to quality and technical requirements. The same quality infrastructure also needs to support industry in developing these products. It is imperative to put in place measures and institutional mechanisms to ensure that all goods and services for domestic and international markets meet the required quality, environment, health and safety standards through appropriate production technologies and other value addition processes. This will significantly increase the producers, processors, traders and consumers’ safety, health and welfare; thereby strongly contributing to Government’s sustainable development efforts to eradicate poverty through wealth creation and stimulate prosperity for all.

    This is in view of the fact that in the present age of globalization, market access require compliance to domestic and international requirements through the adoption of internationally recognised systems. This entails the development and promotion of internationally recognised infrastructure that is compliant to the production of competitive, safe, reliable and cost-effective goods and services. This is a key prerequisite for enhancing the industry’s competitiveness and export market share in tradable goods and services.

    There is, therefore, an urgent need to protect the rights of the consumers and establish a strong and effective regulatory mechanism using accredited laboratories, certification bodies and inspection agencies to control the use of sub-standard products and services in the market in terms of World Health Organisation (WTO), Technical Barriers to Trade (TBT)/Sanitary and Phytosanitary (SPS) measures. The changing face of international trade has led to the requirement by manufacturers and processors to have a harmonized, single, globally accepted technical standards and conformance tests. Poorly designed Technical Regulations and standards have been identified as a barrier to deeper trade and integration in Africa.

    With the different Regional Economic Communities (SADC, COMESA), African countries face the challenge of variation in certification, testing, inspection practices, and standards used by different countries on the basis of the WTO obligation and rights. The divergence of standards and technical regulations make trade between African countries difficult, contentious and expensive, hence low intra-African trade.

    Therefore, an accessible and efficient Regional Quality Infrastructure Policy is needed to support and strengthen businesses’ ability to improve the quality of goods and services. In addition, a regional approach of harmonized Common Free Trade Area will increase competitiveness of goods and services, and promote sustainable development by enhancing innovation and transfer technology. This will enhance our businesses’ capability to effectively engage in trade on the national, regional and international levels, and make a direct contribution to achieving economic growth. Moreover, enablers, such as institutional capacity building and cooperation, are central to achieving this continental objective.

    Having stated the purposes of the Quality Awards, the Voice of Business believes that through Swaziland’s participation, our SME’s, in particular, will get to stretch themselves to deliver goods and services that are of sustainable quality, enabling them to penetrate new markets and to withstand the fierce competition that exists around the globe.

    Swaziland has the potential of exporting more goods made in Swaziland only if it would comply with internationally accepted Quality Standards. The Voice of Business looks forward to the Standards, Quality, Accreditation and Metrology (SQAM) institutions to raise more awareness to businesses in Swaziland about the importance of developing standards and adhering to such standards in order to increase the level of Swazi exports.

    Analysis of the United Nations Sustainable Development Goals (SDG’s) within an African Context (Part One)

    On 25 September 2015, the United Nations adopted a set of goals focused on ending poverty, protecting the planet and ensuring prosperity for all as vital components of a new sustainable development agenda. […]

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    On 25 September 2015, the United Nations adopted a set of goals focused on ending poverty, protecting the planet and ensuring prosperity for all as vital components of a new sustainable development agenda. These goals have specific targets to be achieved over the 15-year period 2015-2030 and require the committed and active participation of all sectors of society, including government, the private sector, civil society and individuals. These goals form a critical component of the 2030 Agenda for Sustainable Development.

    In Africa, the dual commitment to the 2030 Agenda and to the implementation of the African Union (AU) Agenda 2063 informs the vision and plan to build a more prosperous and sustainable Africa within the next 50 years. The importance of the AU Agenda 2063 is emphasised within the 2030 Agenda where it is considered as an integral part of achieving its goals.

    In Swaziland, the SDGs have been translated to foster advocacy and have been integrated with the National Development Strategy. Of the 17 SDGs, the country has prioritized seven, being: decent work and economic growth (SDG8), good health and well-being (SDG3), quality education (SDG4), affordable and clean water (SDG7), industry innovation and infrastructure (SDG9), zero hunger (SDG2) and clean water and sanitation (SDG6). The other SDGs act as enablers and some are cross-cutting. This article will however analyse each of the 17 SDGs within an African context.

    SDG1 deals with the eradication of poverty. Its aim is to eradicate extreme poverty (currently measured as living on less than E20 a day) by 2030. In order to achieve this, a significant amount of resource to provide adequate and predictable means of poverty eradication needs to be mobilised. As such, strong and sound policy frameworks at various levels of the economy are needed to support accelerated investment in poverty reduction. Trade is able to play a critical role in the achievement of this goal, particularly through the optimal and efficient allocation of resources and the removal of trade barriers and constraints. SDG2 aspires to achieve universal access to nutritious and sufficient food all year round by 2030. It hopes to correct and prevent trade restrictions and distortions in world agricultural markets through the corresponding elimination of all forms of agricultural export subsidies and all export measures which have a similar effect as per the mandate of the Doha Development Round. Measures need to be effected that ensure proper and functioning food-commodity markets and their derivatives to enable timely access to market information including food reserves to minimise extreme food volatility. It is critical that food gets to market on time, at a fair price, as well as minimising food spoilage to ensure that a greater proportion of the population has access to food.

    SDG3 entails achieving universal health coverage and financial risk protection, access to quality essential health-care services, and access to safe, effective quality and affordable essential vaccines and medicines. It is important that research and development of vaccines and medicines for diseases that primarily affect a majority of the Swazi population be undertaken. People are the most important resource used by businesses in driving the economy of the country. It is, therefore, imperative that the country’s human resource has easy access to medical health care facilities without which they would not be able to be productive in the workplace which could eventually lead to the collapse of our economy.

    SDG4 seeks to expand the global number of scholarships available in developing countries for enrolment in higher education in developed and other developing countries by 2020. Here, Africa has been specifically mentioned as a beneficiary of this indicator. Also, by 2030, it is hoped to substantially increase the supply of qualified teachers, including international cooperation in teacher training in developed countries.

    The Voice of Business applauds the declaration made by His Majesty King Mswati III that as from next year, the Ngwane Teachers College will be upgraded to a University. The potential benefits of this declaration are far-reaching and will spur further development and sustainable growth for Swaziland, as basis of a sound education and international research cooperation and teaching. We look forward to seeing a national university relevant to the needs of employers in Swaziland being established in the Lubombo Region, the only region currently without a college or university.

    SDG5 includes the ending of all forms of gender discrimination. A key indicator is the enhancing of the use of enabling technology with the use of information and communications technology (ICT) in promoting the empowerment of women. An additional measurable indicator involves the adoption and strengthening of sound policies and enforceable legislation for the promotion of gender equality and empowerment of women and girls at all levels. In promoting this agenda, the FSE&CC through its wing, the Business Women Forum, envisions itself to be the leading organisation that fosters the development and economic empowerment of women by advocating for an enabling environment for sustainable entrepreneurship of women in Swaziland. This initiative is supported by our partner, the United Nations Development Programme.

    SDG6 hopes to achieve universal and equitable access to safe and affordable drinking water and sanitation by 2030. Additionally, by 2030 water-use efficiency across all sectors should be increased substantially as well as ensuring sustainable withdrawals and supply of fresh water in addressing water scarcity. Another important indicator is the expansion of international cooperation and capacity-building support to developing countries in water and sanitation related activities and programmes by 2030. This include water harvesting which should be a greatest priority for Swaziland taking into account the fact that we are from a severe drought. Mistakes of the past in not implementing proper water harvesting techniques should not recur. Water is to business what oxygen is to humans, especially for sectors such as agriculture, hotels and manufacturing. There is, therefore, a great need for the exchange of technologies and policies within the region to facilitate this process, particularly given the adverse effects of climate change: here trade can play a pivotal role in their distribution. Due to space constraints, join us next week as we analyse the remaining SDGs.

    All roads lead to Mavuso Sports Centre

    First and foremost, the Voice of Business in Swaziland would like to wish His Majesty King Mswati III a happy 49th birthday anniversary. The King’s birthday always comes with major developments in the Kingdom as regions always prepare extensively in ensuring that the country’s roads and other infrastructure […]

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    First and foremost, the Voice of Business in Swaziland would like to wish His Majesty King Mswati III a happy 49th birthday anniversary. The King’s birthday always comes with major developments in the Kingdom as regions always prepare extensively in ensuring that the country’s roads and other infrastructure are at the best standard that befit the hosting of such a prestigious event in the land. As has been seen over the years, His Majesty’s birthday has also acted as a tourist attraction event as people from other countries visit the Kingdom to witness the occasion whilst at the same time touring some places around the beautiful kingdom.

    As the world celebrates His Majesty’s birthday therefore, the Voice of Business in Swaziland would like to publicly praise the King for promoting initiatives aimed at facilitating a conducive environment for doing business in Swaziland. These include, but not limited to, vision 2022 whose main objective is to improve the standard of living for all our people through access to quality services, wealth creation and employment opportunities. As one adage says, the poorest man on earth is one without a vision. Through vision 2022, the country has witnessed a lot of progress particularly because almost every organisation existing in the land has subscribed to the principle of professionalism which aligns to the King’s vision in raising the bar to whatever initiative one embarks on.

    As the business community in Swaziland, we also note with appreciation the King’s effort in improving the ease of doing business in the country through the promotion of initiatives such as the Special Economic Zones. Through such initiatives, we remain positive that investors will be motivated to open businesses in Swaziland for the employment of the thousands of Swazis who currently struggle to put a hand in the mouth as a result of lack of job opportunities.

    The Voice of Business further acknowledges one of the King’s projects aimed at promoting science and technology in the country – the Royal Science and Technology Parks. His Majesty’s initiative to establish the Royal Science and Technology Park is the first comprehensive effort to promote science, technology and innovation in the country by providing steadfast support for basic research and innovation and a coherent approach to maximising the innovation dividend. This is a step in the right direction as it has been observed from other countries that such parks have led to the benefit of research, industry and the economy. It is the Voice of Business’ prayer that God may continue instilling His wisdom to the King and Ingwenyama of this beautiful nation as he ushers it into first world status.

    As we wish you a happy 49th Birthday your Majesty, the private sector has only one plea; that it should be fully involved and represented in conversations that have to do with investments in Swaziland. The Voice of Business, if fully involved has a lot to offer as they are the people who know the opportunities and the gaps that exist in every sector of the Swazi economy. It is the Voice of Business’ vision to see established businesses in the country that will usher the people of Swaziland into the first world status, for without jobs, the economy of the country cannot thrive. We all know that the private sector is the engine of economic growth. That said, we wish you a happy birthday Your Majesty.

    On another note, the Voice of Business is concerned by reports in the media about the kidnapping of businessman Almor Oliveira. According to reports, Oliveria was taken away by unknown people at his business premises while closing his shop following a scuffle that was confirmed by the police who spotted blood stains in his car which was found parked outside his office building in Matsapha. The Voice of Business is hopeful that the abductors will soon be brought into book and be taught a lesson that shall act as a precedence in discouraging such uncalled-for practices from ever happening again in Swaziland. The Kingdom is known to be a peaceful and an investor-friendly nation, therefore, any act that wants to tarnish the country’s good record in promoting investments can never be tolerated by the business community. We urge all Swazis who may have any information about the abductors to assist the Royal Swaziland Police in fast-tracking their arrest.

    Finally, preparations for the Business Sports Day are already at an advanced stage. Twenty companies will be battling it out at the Mavuso Sports Centre on Tuesday, 25 April, a day after the celebration of the King’s birthday. The Voice of Business is humbled by the support it has received from the private sector in ensuring that this day happens. It is envisaged that the Business Sports Day will act as a platform for members of the business community, where employees and employers will socialize and get to know each other outside of work boundaries through sports and fun. SMEs are encouraged to be part of the event and market their products or services to the hundreds of people who will be at the Mavuso Sports Centre, come 25 April.

    During the day, there will be five sporting codes that companies will be competing in. These include soccer, netball, volleyball, basketball and athletics. For those who have never kicked a ball in their lives, they need not worry as the Voice of Business will also be providing fun games such as tug of war, egg race and sack race. The question is: which company will be the overall winner of the Business Sports Day? All answers will be found at the Mavuso Sports Centre.

    Data is the Future of Business

    From the year 2003, the Swaziland Government developed a series of ICT related Policies designed to unlock the entrepreneurial potential of existing and prospective businesses in the country. The Policies contained requisite framework for the liberalization of the ICT Sector, through the eventual creation of a new regulatory regime which will promote the technological convergence […]

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    Were this world an endless plain, and by sailing eastward we could for ever reach new distances, and discover sights more sweet and strange than any Cyclades or Islands of King Solomon, then there were promise in the voyage. But in pursuit of those far mysteries we dream of, or in tormented chase of that demon phantom that, some time or other, swims before all human hearts; while chasing such over this round globe, they either lead us on in barren mazes or midway leave us whelmed.

    E4 Million lost through internet fraud and false pretense in 2016

    Ask anyone involved in fighting cybercrime on a daily basis about what businesses should know, and the first thing they will say is that no organisation is immune. Cyber criminals will do their research; they will look at open-source intelligence opportunities, they will look at physical vulnerabilities, they will look at what a target company […]

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    SMEs should adopt corporate governance measures

    All businesses in the country should be excited that one of the directors in the Institute of Directors in Southern Africa, Ansi Ramalho has confirmed her coming to the Kingdom to make a presentation on the newly launched King IV code during the FSE&CCs Gala Dinner. The reason to be excited is, of course, for […]

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    A Minute with the FSE&CC President Andrew Le Roux

    Le Roux is a fourth generation Swazi who is highly conversant with the business environment and issues affecting the private sector in Swaziland. His view is that Swaziland has limitless potential for business growth, but has become so fixated on the negative and challenges so much that the country is not fully utilizing and exploring […]

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    FSE&CC Committed to Living its Talk

    On Friday 23rd September 2016, the Federation of Swaziland Employers and Chamber of Commerce (FSE & CC) held its Annual General Meeting, wherein it presented its Annual Report for the year 2015/16 to its members. Before discussing how the “Voice of Business” performed in the past fiscal year, it is befitting to congratulate Mr. Andrew […]

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    Killing the Goose that lays the Golden Egg

    The FSE&CC as the “voice of business” is concerned by reports in the media and from its members, in the past few months, on strikes that have been increasingly been characterised by violence, vandalism and/ or threats thereof. Whereas the FSE&CC accepts that lawfully convened strikes are legitimate tools for negotiation and collective bargaining against […]

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    Disparities in SADC Trade Regimes Inhibit Intra-Regional Trade

    The “Voice of Business in Swaziland”, FSE&CC, was invited to make a presentation at the recent Swaziland International Trade Fair Business Seminar, on “Building strong intra-trade relationships in SADC. Speaking for the “Voice of Business in Swaziland”, this is what was shared: ‘‘Intra-regional trade in SADC countries has remained low, hindering member states […]

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    Make your business relevant, recognised and respectable

    Saturday, August 25 marked the official opening of the 48th edition of the Swaziland International Trade Fair (SITF), where His Majesty King Mswati III touched on a myriad business issues relevant to the business community in the Kingdom of Eswatini. The “Voice of Business” would not have done justice to itself and to the entire […]

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