Eswatini's economy: a currency on the rand and a budget on customs

Why the lilangeni is tied to the rand

Eswatini issues its own currency, the lilangeni, plural emalangeni, and holds it at par with the South African rand; Britannica notes that the rand is accepted as legal tender inside the country as well. Eswatini, Lesotho, Namibia and South Africa form the Common Monetary Area, within which funds move without restriction. Wikipedia's economy article puts the consequence plainly: pegging to the rand subsumes Eswatini's monetary policy to South Africa's. The World Bank's country overview of 2026 records that the central bank keeps its policy rate broadly aligned with that of the South African Reserve Bank.

The peg means that prices track South Africa's too. The World Bank gives headline inflation of 4% in 2024 and 3.1% in 2025, and 2.5% in July 2026, when falling food prices partly offset a sharp rise in fuel. The Encyclopedia of the Nations reported the exchange rate in May 2003 as E1 to $0.1329.

How the customs union pays for the state

Eswatini belongs to the Southern African Customs Union with South Africa, Botswana, Lesotho and Namibia. The Encyclopedia of the Nations describes the mechanism: South Africa levies and collects most of the customs, sales and excise duties for all five and pays a share of the revenue to the other four. Britannica lists SACU receipts first among the government's sources of revenue, ahead of sales tax and income tax.

That share has always been large and has always moved. Wikipedia's history records customs remittances at between 48.3% and 67.1% of state revenue from 1981 to 1987. When receipts fell in 2011 the government ran short of cash and asked South Africa for a loan, then declined it because the conditions included political reform; receipts recovered from 2012. Wikipedia's economy article records budget surpluses in 2006 to 2007 and 2012 to 2013 on the back of SACU revenue.

The World Bank's overview describes the most recent turn. In 2025 SACU revenue fell and recurrent spending ran higher than planned, and the deficit reached an estimated 5% of GDP. A public sector salary review in late 2025 raised the wage bill to nearly 34% of total public spending, government debt rose to about 44% of GDP, and interest payments, about 3% of GDP, were budgeted to exceed health spending in 2026. Reserves stood at 2.7 months of import cover in 2025, below the official floor of three. The government has set up a SACU Revenue Stabilization Fund to smooth the swings.

What the sugar estates produce

Wikipedia records that the closure of the wood pulp producer in January 2010 left sugar as the sole main export, and the Encyclopedia of the Nations calls it the most important cash crop. The Eswatini Tourism Authority dates the industry in the Lowveld to the late 1950s and describes the north-east as now characterised by vast estates, each with its own country club. The Encyclopedia of the Nations put the cane harvest at 3.7 million tons in 1999, from three mills. Wikipedia's economy article gives sugar output of 680,881 tonnes in 2014 to 2015, of which about 355,000 tonnes went to the European Union and 34,000 tonnes to the United States under its tariff rate quota.

Access to protected markets shaped the industry. The European Union's Sugar Protocol, from 1975, bought set quantities from African, Caribbean and Pacific producers at prices well above the world price; it ended in 2009 and was replaced by an Economic Partnership Agreement under which Eswatini sells to the EU free of duty and quota, at lower prices. Ownership runs close to the throne. Wikipedia records that the Royal Eswatini Sugar Corporation is majority owned by Tibiyo Taka Ngwane, which it calls the king's sovereign wealth fund, with a further 6.5% owned by the government.

The industry has its critics. Wikipedia's account cites forced evictions for plantations, child labour and working weeks of up to 60 hours, and quotes the International Trade Union Confederation on "arduous and unhealthy working conditions, miserable wages and violent repression of any attempt to unionise". The weather is the other exposure: the drought of 2015 to 2016 cut sugar exports.

How two kinds of farming share the land

Agriculture divides along the line of tenure. On Title Deed Land, freehold estates grow sugar, timber and citrus with heavy investment and irrigation. On Swazi Nation Land, held in trust and allocated by chiefs, families farm small plots for their own use; the Encyclopedia of the Nations, in figures running to 2003, put such holdings at under three hectares on average against about 800 hectares for a freehold farm. Britannica calls the result a marked duality of large-scale intensive production and small-scale semi-subsistence farming, and notes that average income figures hide it.

Maize is the staple, with sorghum, pumpkins, beans and peas beside it, and Britannica describes yields as generally low. In 1999 the Encyclopedia of the Nations recorded 113,000 tons of maize, 31,000 tons of oranges, 25,000 tons of grapefruit, 8,000 tons of pineapples and 6,000 tons of cotton fibre. Pineapples grow in the Middleveld around Malkerns, citrus and cotton in the Lowveld. Cattle are a store of wealth as much as a source of milk and draught power, and Britannica writes that herds exceed what the land can carry. The World Bank estimated in its 2026 overview that about a fifth of the population was food insecure.

What the factories and forests made

Manufacturing grew from farming and forestry. Britannica describes extensive plantations of pine and eucalyptus on the Highveld supplying a pulp mill and several sawmills; the Encyclopedia of the Nations gave the Usutu pulp mill a capacity of 220,000 tons of kraft pulp, and Wikipedia records that the wood pulp producer closed in January 2010, leaving sugar as the main export. Fruit canning, drink processing and confectionery grew beside them, and the drought of 2015 to 2016 cut exports of soft drink concentrate along with sugar.

Sanctions against South Africa in the late 1980s brought firms across the border. The Encyclopedia of the Nations names Coca-Cola among South African-based operations that relocated, and describes the slowdown in the early 1990s when sanctions ended and South African tariffs came down. Clothing came next under the United States' African Growth and Opportunity Act: Wikipedia's economy article records textile exports growing by over 200% between 2000 and 2005, and sugar exports by more than 50%, before the removal of textile preferences put both at risk. The Tourism Authority describes Matsapha, in the central region, as the main industrial area.

What happened to the mines

Mining in Eswatini began with ochre and has almost stopped. The Lion Cavern on Bomvu Ridge was dug for red ochre tens of thousands of years ago, and the same Ngwenya deposit was mined for iron ore in the twentieth century; output reached 2.24 million tons in 1975 and stopped in the late 1970s. The Encyclopedia of the Nations follows the rest down: chrysotile asbestos at Bulembu, mined from 1939, produced 27,693 tons in 1998 and stopped in 2000; diamond mining at the single kimberlite pipe at Dvokolwako produced 70,000 carats in 1996 and stopped that year; and the only coal producer closed after a methane explosion in 2001. Mining and quarrying were 1.4% of GDP in the 2000 to 2001 fiscal year.

The mines that mattered most were outside the country. The same source counts 10,000 to 15,000 Swazis employed in South African mines, and their remittances fell with the collapse of the gold market and layoffs in South Africa. Britannica describes migrant work in South Africa, mostly by men, as the outlet for a formal economy that cannot absorb new workers.

What tourism and crafts bring in

Tourism grew out of the border. Wikipedia's article on tourism records that under apartheid visitors from South Africa crossed for television, sporting events and gambling that were unavailable at home, and that arrivals rose from 89,015 in 1972 to 257,997 in 1989; tourism was 3% of GDP in 1988. Britannica centres the trade on the hotel and casino complex of the Ezulwini Valley, with smaller ones at Piggs Peak and Nhlangano, and the Tourism Authority still describes casinos built when gambling was banned in South Africa. After apartheid ended and the war in Mozambique stopped, growth slowed: many visitors are in transit between the two neighbours, most stay one night and many come only for the day. The Eswatini Tourism Board, set up in 2003, has since promoted the royal ceremonies and the game parks, and in 2006 the country joined the Lubombo Route agreement with South Africa and Mozambique, which let visitors cross all three on a single visa.

Crafts are the smaller trade that tourism feeds. Wikipedia's culture article cites a TechnoServe study of February 2011 that counted over 2,500 people, many of them women, employed in formal handcraft businesses whose goods range from housewares to glass, stone and wood work. Britannica adds high-quality handmade textiles and tapestries to the list.

Who works and who does not

Jobs are the gap the sources return to. The World Bank's overview gives 52.2% of people aged 15 to 24 unemployed in 2025, and 54% of the population living below the lower-middle-income poverty line of $4.20 a day in 2025, with a Gini coefficient of 51.2. It writes that only 60% of fifteen-year-olds are expected to survive to the age of 60, which it attributes to the toll of HIV and other preventable diseases. World Bank data from UNAIDS estimates give HIV prevalence among people aged 15 to 49 of 23.4% in 2024, down from 29.4% in 2014.

Wikipedia's economy article describes most of the growth in public spending going on wages, transfers and subsidies, and the World Bank's 2025 Public Finance Review, as summarised in its overview, calls the public sector-driven growth model fiscally unsustainable. Only 15% of micro, small and medium enterprises could reach formal credit in the Bank's 2025 Financial Sector Assessment.

Where growth and power come from

Growth has been modest and steady. Wikipedia's economy article gives average real growth of 2.8% a year since 2001, about two percentage points below the rest of SACU. The World Bank's overview gives growth of 3% in 2024 and 4.8% in 2025, driven by services and by infrastructure such as the Mpakeni Dam, against a ten-year average of 2.5%, and expected 3.8% in 2026.

Trade runs mostly through one neighbour. The Encyclopedia of the Nations reported that South Africa supplied an estimated 96% of imports and took 60% of exports in 1996, and Wikipedia gives over 90% and about 70% for a later period it does not date. Freight leaves by rail: the older Goba line runs east to the port of Maputo, and a north-south link completed in 1986 connects to the South African ports of Richards Bay and Durban. Electricity also comes across the border. The World Bank records that Eswatini imports 70% of its electricity from South Africa, that 88% of households had electricity but only 60% in Lubombo and 63% in Shiselweni, and that a revised Generation Master Plan aims for 1 gigawatt of domestic capacity by 2050.