SWAZILAND: Poverty and AIDS biggest challenges - finance minister

[ This report does not necessarily reflect the views of the United Nations]

MBABANE, 9 Mar 2005 (IRIN) - Finance Minister Majozi Sithole on Wednesday painted a bleak picture of Swaziland's economy, made worse by an on-going humanitarian crisis, when he presented this year's budget to parliament.

"Striking a balance between the social and economic development of the country remains the key challenge of this budget," Sithole said.

New spending on humanitarian measures was extremely limited, Sithole warned, because the record R6 billion (US $1 billion) budget contained an historically high deficit. GDP growth was expected to fall to 1.75 percent this year, about half of what was achieved two years ago.

With unemployment up and foreign direct investment down, Sithole predicted escalating crime in a country where poverty was on the rise.

"It saddens me to report that despite all efforts, poverty seems to be on the increase to 69 percent from the 66 percent reported in my last speech," he told MPs.

He said that government's major challenge was poverty and HIV/AIDS. "All government projects should be subjected to appraisal on their poverty reduction role," he recommended.

Poverty eradication efforts are hampered by widespread government corruption. In an interview with IRIN prior to the budget speech, Sithole revealed that government was thought to be losing R30 million ($5 million) to R40 million each month to corrupt government practices, abetted by private firms doing business with government.

Sithole detailed for MPs the economic toll of AIDS, particularly its effect on the workforce.

"We have seen total deaths from AIDS increase from 13,000 in 2001 to 17,000 in 2003 (out of a national population of 970,000). Who will care, educate and create economic opportunities for the 10,000 children expected to be orphaned in this year alone? We have also seen the catastrophic impact of the epidemic as indicated by absenteeism and demand for sick and compassionate leaves," he said.

Due to HIV/AIDS, life expectancy has declined to 37.5 years, from 65 years in 1991. Had there been no AIDS, the average Swazi in 2005 could expect to live to be 73 years, Sithole noted.

"Another way of looking at the cumulative impact of HIV/AIDS is the probability that a young Swazi who is today 15 years old will reach the age of 50 is 28 percent for males and 22 percent for females (compared to 94 percent for males and 97 percent for females had there been no AIDS)," Sithole said.

AIDS' impact on the agricultural workforce has worsened drought-reduced harvests, the finance minister reported.

"Swaziland is endowed with an immensely productive agrarian base, but achieving the desired status of food security remains a distant dream. About 60 percent of the food consumed in the county is imported," Sithole said.

About a quarter of the population currently exists on food aid provided by the World Food Programme and other humanitarian agencies.

The Ministry of Education won the lion's share of social spending in the new budget with a vote of $200 million. New programmes are to target education for orphans and vulnerable children, and special education for the deaf and physically impaired.

[ENDS]