Business Eswatini’s Reaction to Budget Speech 2021 by Hon. Minister of Finance
Business Eswatini would like to acknowledge the speech by the Hon. Minister of Finance. We must say that the minister was his ‘typical self’ which means he was not unpredictable in his approach. We would like to thank him for that because as a business community we hate surprises.
The speech was well-articulated and also well-aligned to the challenges of this moment. We are aware of the difficulty of having to allocate limited resources to a wide array of needs. Not only that, but also the obtaining economic environment is extremely unpredictable as well as volatile which makes allocating resources a very challenging task indeed, if not downright nightmarish. Of particular importance, it does not escape our attention that the Hon Minister made every attempt to cater for and accommodate all the sentiments and guidance as pronounced by His Majesty the king in his recent speech from the throne.
Taxation not the Solution
On many occasions in our engagements with government we have been lamenting the deteriorating productivity of the business sector due to many reasons over and above the Covid-19 pandemic which had changed its form from a health crisis to a global economic crisis. One of the challenges faced by the business sector has been government’s inclination to exclusively rely on tax revenue in order to steer the economy out of danger. On many occasions this has proven to be self-defeating.
It is for this reason that Business Eswatini is thankful for what now seems to be the convergence of minds on these critical matters. We need to steer clear of major tax escalation in favour of rejuvenating the economy in all its aspects. It would have been foolhardy and ill-advised had Government fallen for the temptation to increase taxes against a backdrop of a fledgling economy. For their restraint, we wish to express our sincere thanks as a business community.
That being said, we would like to reiterate the importance of fiscal prudence on the part of government as His Majesty directed recently. We would like to echo his sentiments in this regard. We believe that this is the right prescription that will see us through the road to economic recovery and success.
The accommodative monetary policy stance adopted by the Central Bank of Eswatini and the cooperation we have seen between all stakeholders to ease pressure on the system has also been laudable. Business Eswatini would like to thank the Central Bank governor who kept borrowing costs at the absolute minimum.
We welcome the long-overdue establishment of the revenue appeals tribunal which will go a long way towards the resolution of the many cases pending in our justice system. Parties who have suffered damages will finally get recompense and we are looking forward with excitement to the prospects.
It is also remarkable that for the very first time in decades Government has been able to make inroads into chronic expenditure issues like the CTA and the Phalala Fund. We would like to heap accolades on gov’t for this achievement. Credit is owed for their perseverance and commitment to protecting the tax payers’ hard-earned money. Similarly, the overhaul of the wage bill has proven to be elusive for many years now, hence we welcome His Majesty’s and Government’s stance on “doing more with less”, and look forward to what shape and form this commitment will take over the years.
As representatives for the private sector, we commend Government for their commitment to the clearance and management of arrears. These efforts have not gone unnoticed and will surely go a long way towards aiding the private sector and boosting confidence in Government in the short term, while enhancing efficiencies in our systems which will ensure the good health of our economy in the long term.
Our nation is treading on harsh and uncharted waters with a fiscal crisis that has been decades in the making, a pandemic and an economic crisis to boot. It is clear that there are no silver bullets and shortcuts to working our way out of this situation. While the budget speech gave us cause for hope it is clear that there is still a lot of hard work to be done ahead.
We sincerely appreciate that Government’s tone has shifted remarkably and that the private sector is seen more and more as an essential partner in the nation-building process. Private Enterprises are the creators of employment and national wealth without which the country cannot succeed.
The BE Team is yet to closely study the budget estimates in detail to determine the extent to which Government has been able to, quite literally, put their money where their mouth is. However, for our part, as the private sector, we reaffirm our commitment to our continued partnership with government as we economically heal and revive our nation together.
E. Nathi Dlamini
Business Eswatini CEO