JOBS FOR KING MSWATI’S BOYS

The following is a media release issued today (26 January 2011) from the Swaziland Solidarity Network (SSN). It criticises the Swazi Royal Family for using jobs in the kingdom’s civil service as a way of rewarding supporters. As the International Monetary Fund seeks 7,000 job losses among civil servants, SSN shanes those who are on the government payroll, courtesy of King Mswati III, sub-Saharan Africa’s last absolute monarch, but who do no work.

SOURCE

The IMF’s Recommends A Less Effective Civil Service as Mswati's Cronies Take Enemas at Tax Payers' Expense.

SSN PRESS RELEASE –

26th January, 2011

According to the latest Public Information Notice (PIN) released by the International Monetary Fund (IMF) on the 24th of January 2010, the kingdom of Swaziland has the second largest wage bill in sub-Saharan Africa after Lesotho. The country’s finance minister once reported that with this wage bill makes up 54% of the country’s overall budget.

Despite the fact that the IMF has recommended the reduction of this wage bill by taking drastic measures such as not hiring any new civil servants, implementing early retirement exit schemes and things continuing its privatization policy among other things, the government has stalled on implementing this recommendation out of fear that it will spark social upheaval.

What it has since done, however, is to claim to have cut overtime wages, freeze the hiring of civil servants and reduce ghost workers, the latter being a serious problem in the country’s civil service. The wage bill is artificially inflated by the fact that some unscrupulous civil servants draw salaries of nonexistent workers. This is one of the many fruits of the royal blanket covering corruption.

Due to the Royal family’s extended patronage systems many other registered civil servants draw salaries that they never work for. This is most prevalent in the armed forces, particularly in the defence force, which has gone to the extent of hiring the king’s two sons despite the fact that they are rarely ever in the country and do no soldier work.

The king’s brother in law, Sibusiso Mngomezulu is another well connected individual who draws a high salary in the country’s defence force despite the fact he has a job as a financial director at Chancellor House, the ANC’s private investment firm that recently bought a coal mine in Swaziland. All this rot is happening while both countries are struggling to create quality jobs for its citizens.

A large number of civil servants in less senior positions are also guilty of this grossly unprofessional behaviour. Many of them during this time of the year are found relaxing at the country’s natural hot spring in Lobamba bathing and taking enemas during working hours having told their superiors that they are on official royal duty.

As the financial crisis deepens in the kingdom these are the issues which should be dealt with immediately before any hard working and vastly experienced civil servants are pressured into taking early retirement schemes, a move that will render the civil service less effective than it currently is and in the end add to the country’s economic woes.

Issued by the Swaziland Solidarity Network [SSN] South Africa Chapter.

SWAZILAND, SPONSORED BY COCA-COLA

Coca-Cola is to work to promote Swaziland, a kingdom with one of the world’s worst human rights records.

Coca-Cola presently contributes about 40 percent of the kingdom’s gross domestic product (GDP) through the concentration plant it has in the kingdom, ruled by King Mswati III, sub-Saharan Africa’s last absolute monarch.

This helps to prop up a regime that consistently uses torture against dissidents and alleged criminals. In September 2010, Barnabas Dlamini, Swaziland’s illegally-appointed Prime Minister, said he wanted people (especially foreigners) who criticised him and his government to be tortured using foot whipping.

Swaziland Investment Promotion Authority (SIPA) has said that it will work with Coca-Cola to market the kingdom internationally.

Phiwayinkhosi Ginindza, SIPA Chief Executive, said a country market study done with Coca-Cola was almost complete.

Ginindza told the Swazi Observer, the newspaper in effect owned and edited by King Mswati, they had identified Taiwan, the Middle East, and Europe as some possible targets.

Swaziland supplies the Coca-Cola concentrate (the sugary syrup the drink is made from) to most of Africa, big parts of Asia and all of Australia and New Zealand from its industrial plant in Matsapha.

Swaziland has been mortgaged to Coca-Cola, ever since it allowed the company to use it in its fight against workers’ interests in other countries. In 2009, Coca-Cola closed its concentrate supply plant in Nigeria, citing an ‘unfriendly manufacturing environment’ in that country.

It had made ‘little profits because of the high manufacturing costs’.

Coca-Cola is said to be so large in Swaziland that it accounts for 40 percent of the kingdom’s GDP, but it is said to be exempt from paying full taxes.

Coca-Cola also has an impact on the international standing of Swaziland’s economy. The money generated by Coca-Cola is what largely accounts for the kingdom being classified as a ‘lower-middle income developing country’ (and therefore not eligible for certain types of international aid), even though seven in ten of Swaziland’s one-million population live in abject poverty, earning less than one US dollar a day.

This dominance of the Swaziland economy by Coca-Cola represents a breathtaking piece of economic mismanagement by King Mswati and the governments he appoints. It in effect allows Coca-Cola to determine the economic (and other policies) of the kingdom. Coca-Cola can blackmail Swaziland at any moment it likes. If it doesn’t get its way it simply has to threaten to take its business elsewhere and Swaziland’s already depressed economy sinks into the mire.

Of course, it could use this power for positive effects. It could demand political reforms in the kingdom that has one of the worst human rights records in the world. It could insist that political parties be unbanned and that the Swaziland Constitution be honoured.

Alas, Coca-Cola won’t do any of that: it likes things the way they are. Coca-Cola is in Swaziland in such a big way precisely because it is a dictatorship. This allows wages to be kept low, unemployment high and workers rights to be oppressed.

It also means that Coca-Cola can work directly with King Mswati and the King can ensure that the company gets all it wants. It is no secret that the King keeps a slice of the income from Coca-Cola ‘in trust for the nation’, which we all know means, ‘for himself’.

King Mswati is said to be so close personally to Coca-Cola that he visits the company’s global headquarters in Atlanta, Georgia, US, each year.

Ginindza, of SIPA, told the Observer, ‘We decided to use Coca-Cola as they have shown so much love for the continent [Africa] and they care for it. Over the past 20 years Africa has developed a relationship with them.’

But does Coca-Cola really ‘love’ Africa? In October 2010, Bloomberg Business Week reported that Coca-Cola’s sales in the US and other countries had stagnated and it will rely on some of the poorest nations (including in Africa) to generate the 7 to 9 percent earnings growth it has promised investors.

Consumption of Coke is also low in India and China, relative to the US, Europe, and Latin America, but those countries present less of an opportunity for the company than Africa, where Coke is the dominant brand and a middle class is just emerging.

Tara Lohan at foodchange.org reports that Coca-Cola has been in Africa since 1929, but has not reached total domination yet.

Lohan says, ‘The reason for this is that while there are many countries in Africa with growing middle classes, it’s also a continent with extreme poverty, scarce or unclean water sources, hunger, political instability, and war. Coke intends to spend $12 billion in the next ten years there and what do Africans get in return? A product that will use vast amounts of water, create more waste, and offer people no nutritional value.

Lohan adds, ‘Having recently been briefed on Coke’s sordid history in Michael Blanding’s new book The Coke Machine: The Dirty Truth Behind the World’s Favorite Soft Drink, I have to say I’m extremely wary of the company’s advances. Blanding's book details Coke's history of anti-union activity in Central and South America, allegations of its fraternization with paramilitaries who murdered bottling plant workers, the effects of marketing to kids in schools, and the wake of environmental catastrophes the company left behind in places like India where Coke has drained and polluted drinking water.

Lohan says, ‘If that's what Coke has in store for Africa, then it looks like the continent is getting the raw end of the deal.’

So there you have it. King Mswati allows Swaziland to be taken for a ride, for his own personal gain.

‘REFUGEE CRISIS’ AS ECONOMY SINKS

A refugee crisis could hit South Africa as Swaziland’s economy sinks and its people flock to leave the kingdom.

And South Africa, their probable intended destination, would be unable to cope with them.

As a result, countless Swazis would be displaced without jobs or health care in South Africa which has its own problems of poverty and unemployment.

The Associated Press (AP) news agency reports that the economic crisis in the kingdom ruled by King Mswati III, sub-Saharan Africa’s last absolute monarch, could lead to a mass exodus of people across the border.

AP reports that trade and human traffic from Swaziland to South Africa has always been controlled and manageable. But what will happen when the occasional individual jumping a border fence multiplies by the thousands? The International Monetary Fund (IMF) recommends a reduction of Swaziland’s government workforce by a third, by about 10 000 people.

In Swaziland it is reckoned that the wages and salaries of each employed person supports on average 10 people. Even Barnabas Dlamini, Swaziland’s illegally-appointed Prime Minister, has said that such a cut in jobs would bring civil unrest.

An economist attached to the Mbabane branch of a South African bank told AP, ‘It’s not a cash flow problem, like government says. It’s a structural problem. The public payroll is bloated way beyond what this country needs, as the IMF has been saying for years.

‘The banking sector is still inaccessible to a majority of Swazis who can’t avail themselves of financial services, and spending on non-essential big-ticket projects is still prioritised.’

The eventual end of the global recession will not remedy Swaziland’s economic crisis and the concomitant scenario of Swazis seeking jobs and humanitarian relief in South Africa. The IMF has noted that Swaziland’s economic decline pre-dates the current global slump by years, while other SADC (Southern African Development Community) countries were seeing robust gross domestic product (GDP) and foreign direct investment growth rates.

To read the full AP report, click here.

IMF WANTS MORE DRASTIC ACTION

The Swaziland Government made the economic crisis in the kingdom worse by agreeing a supplementary budget in November 2010, according to an International Monetary Fund (IMF) report published yesterday (13 January 2011).

And the Government’s decision to increase spending on ‘non-priority’ areas means it must impose even harsher measures on the Swazi people than those already announced.The IMF wants more government services to be privatised and a squeeze on wages in the kingdom, where seven in ten of the population already earn less than one US dollar a day.

The IMF blamed the Swazi Government for helping to create the economic crisis in the first place. It said the Ministry of Finance, headed by Majozie Sithole, the Finance Minister in Swaziland for the past ten years, was not able to cope with the crisis and needed more help to build up its capacity.

Top of the reasons for the economic crisis is what the IMF calls ‘a high government service wage bill’, which has ‘contributed to making the Swaziland wage bill one of the largest in Sub-Saharan Africa’.

The economy generally in the kingdom ruled by King Mswati III, sub-Saharan Africa’s last absolute monarch, ‘continues to underperform other Southern African Customs Union (SACU) members, reflecting an overvalued exchange rate, continued structural impediments to growth, and the heavy toll of HIV/AIDS on economic activity’.

This lack of good management coupled with a reduction in cash receipts from SACU has led to the crisis, the IMF said.

‘The government also added to fiscal pressures by submitting a supplementary budget to parliament in November 2010 to clear capital expenditure arrears. The deficit has been financed through a drawdown of government deposits at the central bank and domestic arrears on all expenditure items, except wages and utilities,’ the IMF said.

IMF Directors said there would have to be ‘additional measures in the 2011/12 budget to compensate for recent increases in non-priority [Government] spending’. Although it did not mention the Sikhuphe Airport project by name, it must have had in mind the government’s decision in December 2010 to to spend another E350 million (about US$50 million) on King Mswati’s vanity project.

The government’s so-called Fiscal Adjustment Roadmap (FAR), put forward by Barnabas Dlamini, Swaziland’s illegally-appointed Prime Minister, and Sithole, the Finance Minister, will not be enough to rescue the economy, the IMF said.

It welcomed the FAR, which includes raising taxes from the poorest people in Swaziland, sacking 7,000 public servants and introducing Value Added Tax (VAT) on goods and services, ‘but emphasized the need for more ambitious and sustained efforts to revitalize Swaziland’s economic performance’.

The IMF welcomed the Government’s ‘intention to reduce the budget deficit to 2 percent of GDP by 2014/15. However, they considered that achieving this target requires bolder fiscal adjustment and budgetary reforms than envisaged in the current plan’.

It said, ‘additional technical assistance is also necessary to build up implementation capacity, particularly at the Ministry of Finance.’

The IMF said the Government should ‘mobilize additional domestic financing’. Although it did not spell out the consequences of this, it could mean new taxes, higher existing taxes and getting more from other forms of government revenue. It could also mean more government borrowing, but in a kingdom of one million people, where seven in ten are in abject poverty, there isn’t much money to borrow.

IMF Directors also ‘called for stepped up efforts to improve the business environment, including by reviving the government’s privatization program, reducing the cost of doing business, and keeping labor costs in line with those in the region’.

The International Monetary Fund (IMF) report came at the end of a visit it made to Swaziland, which ended on 10 January 2011. To read the full report, click here.

See also

MORE DIRE NEWS ON SWAZI ECONOMY

http://swazimedia.blogspot.com/2011/01/more-dire-news-on-swazi-economy.html

WHAT THE IMF SAID TO SWAZILAND

http://swazimedia.blogspot.com/2010/12/what-imf-said-to-swaziland.html