IMF delegation visits Swaziland

IMF delegation visits Swaziland

An International Monetary Fund delegation has began a two-week visit to Swaziland to check if the country was doing well enough to win its approval to secure foreign loans.

Report says that Swaziland got into a financial crisis after South Africa's 2009 recession, which caused a collapse in revenues from the Southern African Customs Union.

The government of Swaziland has kept its head above water by using central bank reserves, which now stand at just over 500 million dollars, and running up to at least 180 million dollars in unpaid bills.

Budget crunch

After a visit to Swaziland in May, the IMF said the African country was facing a severe cash crunch and its performance in implementing reforms such as trimming down its bloated civil service was mixed.

"The IMF team has so far met the minister of finance, the governor of the reserve bank and is due to meet trade unions and cabinet later in the week," the delegation's head, Joannes Mongardini, stated.

South Africa, which dominates Swaziland's tiny economy and accounts for almost all of its trade, agreed to lend its neighbour 2.5 billion rand to help it through a budget crunch.

With a budget crisis, King Mswati III tried to get cash from the IMF, but failed because the board refused to hand over anything without seeing major cuts to what is officially Africa's most bloated bureaucracy.

REUTERS/Susan