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STABILISATION FUND CAN’T CUSHION LOCALS ON PROPOSED HIKES

By NOKUNCEDA MAGAGULA | 2024-11-14

THE Southern African Custom Union (SACU) Revenue Stabilisation Fund cannot cushion Emaswati on water and electricity hikes.

This was stated by Minister of Finance Neal Rijkenberg, where he explained that SACU stabilisation fund was specifically for SACU’s volatility and not to rescue government.

“The Stabilisation fund is for cushioning the volatility of SACU, we must cushion SACU because it might go down” he said.

interest
Rijkenberg stated that the fact that government was doing a better job meant that if there were massive interest hikes, the government could look within their means on what they could do to save Emaswati

The minister had been asked if government would use the SACU stabilisation fund to cushion Emaswati so that the water and electricity hike was avoided.

This was during an engagement with the media which took place during the COMESA Committee of Governors symposium. Rijkenberg explained that the proposed hikes were inflation related increases.

He said those companies also had to pay their staff cost of living adjustment, adding that rhetorically household should also be receiving cost of living adjustment in order to afford such hikes.

Worth noting was that the fund currently holds E1.2 billion.
This was a significant increase from the E350 million previously reported by Rijkenberg.

The current value of the stabilisation fund was revealed by Central Bank Eswatini (CBE)’s Governor Phil Mnisi, during his delivery of the 2024 Governor’s Annual Monetary Policy Statement.

Dr Mnisi stated that on fiscal development, is a key initiative that was developed by the Eswatini government in collaboration with the bank, which is the establishment of the fund.

Dr Mnisi lauded the former Ministry of Finance Principal Secretary (PS) Sizakele Dlamini for the establishment of the fund and further assured that they shall continue working to ensure that the fund became a stable.

“Can we applaud the PS and the board, because now we want to focus on making sure the fund becomes a stabilisation not a risk” he said.

The governor also mentioned that the government had also committed to adding E1.5 billion in the current year 2024/25 financial year budget cycle.

“Already E375 million was deposited into the fund in April when SACU revenue was received” the governor said.

Previous reports state that last year, about E350 million was in the fund.
This demonstrate a difference of E20.65 million from what was currently in the fund and what was there at the time the minister announced.

Whereas the minister had stated that they were trying to meet the target of E1.5 billion, adding that such was something that government was committed to working on.

“We want to beat the E1.5 billion target of the SACU Revenue Stabilisation Fund.
We are committed and want to see how this pans out,” he said.

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