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Economics and business in Swaziland

According to COUNTRYAAH, Swaziland is one of the most economically developed countries in Africa, measured by GNP per capita, but income is unevenly distributed, and growth has hardly followed population growth. The country is one of the continent's most industrialized, although the majority of the population still feeds on agriculture.

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Much of the economic development is due in many ways to the close relationship with South Africa for many years, including during the apartheid era, when Swaziland profited both from contact with South Africa and with the boycott of the apartheid regime. Blue. foreign investment was channeled to Swaziland rather than South Africa, and Swaziland was able to increase production capacity and exports to both South Africa and other countries. South African goods were also exported via Swaziland, in violation of international sanctions. Swaziland is part of the extensive trade and currency cooperation in the region, dominated by the strong party South Africa - through respectively. Southern African Customs Union (SACU) and Common Monetary Area (CMA) - providing significant income to smaller members. South Africa is also a traditionally important labor market.

This deep structural dependence on the South African economy makes Swaziland vulnerable, and South Africa, after the political changes there in the mid-1990s, became a more direct competitor to Swaziland. This applies to foreign investment, which went back to Swaziland in the 1990s. The country's previously extensive tourism has also experienced a decline, including because of. competition from South Africa. An agreement on economic cooperation has also been signed with the other neighboring country, Mozambique, partly in a triangle cooperation in which South Africa also participates. About. 90% of Swaziland's imports come from South Africa, which also accounts for about half of the country's exports. The economy is also vulnerable to fluctuations in the prices of the most important export goods, especially sugar, and to climate change (drought).

Service-providing industries have become the most important economic sector, with just over half of GNI, while agriculture accounts for approx. 13%, but employ about one third of the working population. The industry is substantial, while mining has slowed down, among other things. because of. low demand for asbestos, which was a major product of the sector. The country's economic development is also to some extent hampered by a system of government where the monarchy has extensive power and the absence of democratic rights has contributed to political unrest.

Agriculture and forestry

Especially because of. employment, but also in terms of export value and as a supplier of raw materials to industry, agriculture and forestry are still an important part of Swaziland's economy - although the industry's contribution to GNI has dropped to around 13%. Still find approx. one third of the population live in the sector, which consists of both large-scale operations on plantations and small farms. On the larger plantations sugar cane, maize, pineapple, citrus fruits and cotton are especially grown for export. Swaziland is mainland Africa's second largest exporter of sugar. The plantation operation uses artificial irrigation to a large extent, especially in the arid areas of Middleveld and Lowveld. In the countryside, agriculture is far from being used for its own consumption, with cultivation in particular of maize and cotton. Swaziland also has a large stock of cattle, which is an environmental burden due to. overgrazing. Frozen and canned meat is exported i.a. to the EU. The land is occasionally haunted by drought, which not least affects those parts of agriculture that are not under artificial irrigation. A large part of the land used by small farmers is owned by the royal house.

About 6% of Swaziland is covered by forests, and forestry is of great importance for the production of wood pulp, which next to sugar is the country's most important export product.

Mining and energy

Swaziland has significant mineral deposits, and mining has been an important part of the country's economy but relatively declining in recent decades. This is not least due to the fact that exports of the most important product, asbestos, have been greatly reduced, as well as the recovery of iron ore has ceased and the diamond mine Dokolwako closed in 1996; The extraction of gold is also reduced. Swaziland has large deposits of iron ore and coal, the latter having the greatest economic potential.

Around half of the country's electricity needs are met through its own production. The rest is imported from South Africa. About 50 per cent of its own production is based on renewable energy, mainly hydropower. In 2015, hydropower was expanded with an installed capacity of 61 MW.

Industry

Swazilands is one of Africa's most industrialized countries, and the industry contributes well over a quarter of GNI. The sector experienced significant growth from the mid-1980s, largely as a result of the sanctions against South Africa, which promoted relocation to and new investment in Swaziland. Nevertheless, the industry is mainly based on the processing of raw materials from agriculture and forestry as well as mining. It is produced i.a. canned fruits and meats, as well as other food sources, paper, furniture, textiles, metal products and glassware. The majority of production takes place in the Matsapha industrial area outside the capital.

Foreign Trade

Swaziland has a negative trade balance with foreign countries. In its trade, the country is dependent on South Africa, both by being its largest trading partner and by dominating regional trade cooperation. The main export goods are sugar and wood pulp; Previously, asbestos was an important export item.

Transport and Communications

Swaziland's railway is designed for shipping of the country's imports and exports. It is connected to the ports of Richard's Bay and Durban (South Africa) and Maputo (Mozambique). The line connecting Transvaal and Natal in South Africa goes through Swaziland and is integrated into the South African rail network. There are a total of approx. 3250 km of roads. International airport at Matsape, outside Manzini.

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