ESWATINI · ECONOMY
Key Facts
- —The country Eswatini, formerly Swaziland, is a landlocked kingdom of fewer than 1.3 million people between South Africa and Mozambique, ruled by King Mswati III. Its currency, the lilangeni, is pegged one to one to the South African rand.
- —What changed The International Monetary Fund now projects growth of 3.7% in 2026 and 3.4% in 2027, down from 4.0% and 3.5% in its April outlook.
- —The year before The economy grew 4.9% in 2025, lifted by large public and private investment projects, so 2026 marks a clear slowdown.
- —Prices Inflation is projected at 2.9% in 2026 and 3.2% in 2027, far below the sub-Saharan African average of about 8.6%.
- —The debt Gross government debt is projected at 52.5% of GDP in 2026 and 54.4% in 2027, up from 44.8% in 2025.
- —The US link US goods exports to Eswatini were worth US$44.2 million in 2025 and imports US$25.2 million, so direct American exposure is small.
The International Monetary Fund has cut its growth forecast for Eswatini, the small southern African kingdom between South Africa and Mozambique, to 3.7% for 2026 from 4.0% in April. The Fund also trimmed its 2027 forecast to 3.4% from 3.5% in the World Economic Outlook it released on Tuesday, 13 October, at its annual meetings in Bangkok.
For foreign readers the change is a signal rather than a shock, because Eswatini’s whole economy is worth only about US$6.1 billion this year. It matters because the kingdom’s currency is tied to the South African rand and its budget leans on customs revenue shared with its neighbours, so a slower Eswatini is also a reading on the region.
What the IMF Changed
The new figures come from the October 2026 World Economic Outlook database, the set of country forecasts the IMF, the Washington-based lender that monitors its member economies, publishes twice a year. They put Eswatini’s growth at 3.7% in 2026 and 3.4% in 2027, against 4.0% and 3.5% in the Fund’s April regional outlook for sub-Saharan Africa.
The cut follows a stronger year than the Fund had expected. In April the IMF estimated 2025 growth at 3.6%, but its staff later found that the economy had grown 4.9%, and the October data keep that figure.
The IMF expects growth to settle between 3.3% and 3.4% a year from 2028 to 2031. That is below the 4.5% it forecasts for sub-Saharan Africa as a whole in 2026, though well above the 1.0% it expects for South Africa, the neighbour whose rand is pegged at par to Eswatini’s lilangeni.
Why Growth Is Slowing
IMF staff set out the reasons after visiting the capital, Mbabane, from 23 July to 5 August. They named higher fuel costs, weaker global demand, tighter financing conditions, weather-related disruptions and an easing of investment activity.
The global backdrop has darkened since then. Deniz Igan of the IMF’s Research Department warned on 13 October that tensions in the Middle East could persist or escalate, and said “many energy importing and lower income economies are facing a much more challenging environment.”
The IMF projects world growth of 3.1% in 2026 and 3.4% in 2027, with global inflation rising to 4.7% this year on higher energy and food prices. For Eswatini, the Fund’s own mission had already listed fuel costs first among the drags on growth.
Low Inflation and Rising Debt
Prices are the bright spot in the new numbers. The IMF expects consumer inflation of 2.9% in 2026 and 3.2% in 2027, lower than the 3.5% it projected for 2026 in April and far below the sub-Saharan average of about 8.6%.
Public finances are the weak spot. The IMF mission found that the budget deficit widened to 6.1% of GDP in the 2025/26 fiscal year, from 1.1% a year earlier, as public wages and investment rose.
The October database puts gross government debt at 52.5% of GDP in 2026 and 54.4% in 2027, up from 44.8% in 2025. Unemployment stood at 33.5%, and foreign reserves covered only 2.5 months of imports at the end of 2025.
A large share of state income comes from the Southern African Customs Union (SACU), a revenue pool Eswatini shares with South Africa, Botswana, Lesotho and Namibia. Higher receipts from that pool help the 2026/27 budget, which targets a slightly smaller deficit of 5.9% of GDP.
What It Means for US Readers
For most Americans the direct exposure is small. US goods exports to Eswatini were worth US$44.2 million in 2025 and imports US$25.2 million, according to the US Census Bureau, a US surplus of about US$19 million.
For investors and companies in southern Africa, Eswatini is a small but telling piece of the rand zone. Its lilangeni trades at par with the rand, and at Tuesday’s close one US dollar bought 16.37 emalangeni, so dollar returns there move with South Africa’s currency.
Low inflation keeps local prices fairly stable for visitors and buyers paying in dollars. The bigger risk for outsiders is fiscal, because the IMF projects government debt above half of annual economic output in both 2026 and 2027.
The IMF expects the US economy to grow 2.3% in 2026, so Eswatini will still grow faster on these numbers. That says more about the kingdom’s low starting point, with output of about US$4,800 per person, than about any boom.
Who Speaks for Eswatini
Eswatini sent Finance Minister Neal Rijkenberg, who runs the budget, and Central Bank of Eswatini Governor Phil Mnisi, whose bank sets interest rates, to the Bangkok meetings, the Times of Eswatini reported. The Rio Times found no public comment from either on the new forecasts by Wednesday morning.
What Is Not Known
The IMF has not published a country-by-country explanation for the cut in Eswatini’s forecast. Its October database gives the numbers and its August mission statement gives the reasons staff saw then, but neither puts a growth cost on each factor.
It is also not known how the government will respond. The Fund has urged spending restraint, especially on transfers, and whether Mbabane trims spending, delays projects or borrows more will shape the 2027 figure.
What Comes Next
The IMF will revise its forecasts again in its next World Economic Outlook reports in 2027. The kingdom’s next budget, for 2027/28, will show whether the government follows the Fund’s advice to narrow the deficit.
Frequently Asked Questions
What did the IMF change for Eswatini?
It cut its 2026 growth forecast for Eswatini to 3.7% from 4.0%, and its 2027 forecast to 3.4% from 3.5%. The new numbers are in the October 2026 World Economic Outlook, released on 13 October.
Why is Eswatini’s growth slowing?
IMF staff pointed to higher fuel costs, weaker global demand, tighter financing, weather-related disruptions and easing investment. Growth is also coming down from a strong 4.9% in 2025.
Is inflation a problem in Eswatini?
No, the IMF projects inflation of 2.9% in 2026 and 3.2% in 2027. That is far below the sub-Saharan African average of about 8.6%.
Does the cut affect Americans?
Only slightly, since US goods trade with Eswatini came to about US$69 million in 2025. Investors in the region should watch the rand, because the lilangeni is pegged to it at par.
Sources: IMF, World Economic Outlook database, October 2026, Eswatini real GDP growth, IMF, WEO October 2026, Eswatini inflation, IMF, WEO October 2026, Eswatini government debt, IMF, Regional Economic Outlook for Sub-Saharan Africa, April 2026, Statistical Appendix, IMF, Press Release 26/273, 5 August 2026, IMF Media Center, World Economic Outlook, Annual Meetings 2026, 13 October 2026, IMF, Kingdom of Eswatini country page, US Census Bureau, trade in goods with Eswatini, Times of Eswatini, IMF lowers Eswatini 2026/27 growth forecasts, 14 October 2026. Exchange rate: Tuesday 13 October 2026 close, 16.3655 emalangeni per US dollar. All retrieved 14 October 2026.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief