/ 15 August 2000

CURRENCY HITS SWAZI DEBT

SWAZILAND’S external debt rose by 16.7 percent in the last fiscal year, largely as a result of a currency slide, the Central Bank of Swaziland said. However, the country’s debt stock remained below “the critical levels”. “At the end of March 2000, external liabilities increased as the local currency continued to depreciate against the major currencies,” the Bank said in its quarterly report. The stock of public sector external debt increased to 1.54 billion lilangeni ($223m), a 16.7 percent increase over the March 1999 position. The lilangeni is directly pegged to the South African rand and both currencies were battered by a global equity market crisis and negative investor perceptions concerning neighbouring Zimbabwe early this year. The country paid 44.2m lilangeni in debt servicing in the quarter, an increase of 0.59m lilangeni over the corresponding 1999 quarter. The Bank said Swazilands debt stock equalled 17.8 percent of Gross Domestic Product (GDP). According to a measure used by the International Monetary Fund and the World Bank, a country reaches a “critical level” of indebtedness when its debt stock equals 50 percent of GDP. The tiny kingdom of under one million people is one of a handful of African countries rated as a middle income country by the United Nations Development Programme. – AFP