The African Development Bank (AfDB) has approved a $47.5 million loan to Eswatini to support urgent economic reforms and address soaring youth unemployment, the bank announced on Thursday.
The funding will launch the Enhancing Economic Resilience and Competitiveness Programme (EERCP), a two-year initiative aligned with Eswatini’s National Development Plan (2023–2028).
The programme aims to strengthen fiscal sustainability, stimulate private sector-led growth and improve livelihoods in a country grappling with declining gross domestic product (GDP) and mounting fiscal pressures.
AfDB deputy director general for southern Africa Moono Mupotola said the programme was essential at a time Eswatini is navigating “challenging economic conditions while implementing ambitious reforms.”
“Our support will help the Kingdom build fiscal resilience while creating an enabling environment for private sector-led growth that can generate jobs for young people and women,” she said.
Eswatini’s economy faces significant headwinds, with GDP growth declining from five percent in 2023 to an estimated 3.6 percent in 2024, primarily due to the impact of extreme droughts on agricultural output.
The fiscal deficit has widened from 1.5 percent in 2023 to an estimated 1.7 percent in 2024, driven by underperformance in customs revenues and increased public spending pressures.
The EERCP focuses on two pillars: fiscal and public financial management reforms, and competitiveness enhancement to promote inclusive and green growth.
It builds on AfDB’s previous support for economic recovery and includes technical assistance in state-owned enterprise reform, procurement modernization, and gender policy implementation.
Expected outcomes include reduced domestic arrears, increased private sector contribution to GDP, expanded renewable energy share, and improved scores on the AfDB’s Country Policy and Institutional Assessment tool.
JN/APA