How Prince Mahlaba cost us E2.4bn

An ill-timed outburst by King Mswati III’s advisor and senior member of the royal household, Prince Mahlaba is what has delayed Swaziland’s bid to secure a E2.4 billion bailout from neighbouring South Africa, it has been revealed.

Prince Mahlaba infuriated by the conditions attached to the loan said its acceptance would be tantamount to selling the country to South Africa. He was particularly against the one condition that would have paved way for democracy and the unbanning of political parties.

Inside sources have revealed that signing of papers for SA to transfer the first tranche was put on hold pending further talks between King Mswati and President Jacob Zuma. The king was already in seclusion in preparation for the sacred incwala ceremony when the proposal for fresh talks was made.

The proposal for a fresh round of talks was made to new Minister of Foreign Affairs, Mtiti Fakudze, on November 22 when he led a delegation to South Africa with the intention to finalise the loan deal by signing the papers.

The loan trail has blown hot and cold since August last year while the government dragged its feet in signing the deal. With the marked improvement of revenue from SACU which contributes over 60 percent to the national budget, the kingdom may altogether abandon the loan talks. 

Returning from a trip in South Africa last year, the king announced that Swaziland has clinched a deal with SA for provision of E2.4 billion bailout following the kingdom’s fiscal crisis arising from a drop in receipts from the Southern Africa Customs Union (SACU) and failure to curb expenditure, in particular salaries and vanity projects.

If everything had moved according to plan, negotiations between the relevant parties finalised and signed, the first tranche of the loan should have reached the Central Bank of Swaziland in August and the last tranche at the end of next month.

It soon came out that the king had breached an agreement to prematurely announce the loan secured from the neighbouring country. It had been agreed the loan would be announced only after the paperwork had been completed.

In the heat of things, SA’s Minister of Finance Pravin Gordhan had to hastily convene a press conference to do damage control.

President Zuma had already taken a hammering from pro-democracy campaigners here and in SA for bailing out the kingdom without imposing conditions for democracy. Then, it wasn’t known conditions were attached to the loan.

Swaziland had approached SA with a request for a loan to alleviate a fiscal crisis officially attributed to global recession. No mention of gross mismanagement and corruption was made.

The kingdom’s first attempt to secure a loan for budget support from the African Development Bank had failed.

The situation was becoming desperate. Fears of chaos and anarchy if government missed payment of salaries for civil servants hovered over the kingdom’s government.

After a series of meetings between the king and the SA president, Swaziland’s request was granted with conditions.

There are four conditions attached to the loan. These are; Confidence building measures to be undertaken by the government of Swaziland, fiscal related technical reforms required by the IMF and to be implemented by the government of Swaziland, capacity building support to be provided by SA and co-operation in multilateral agreements.

The conditions, in particular the first one, gave government and the likes of Prince Mahlaba sleepless nights and delayed completion of the paper work.

Its basis is a 2004 agreement to establish a Joint Bilateral Commission for Cooperation signed between the two countries. It (JBCC) contains a set of objectives that promote economic and social development, multilateral cooperation, democracy, human rights and good governance, credible and effective leadership, development of a strong civil society and respect for universal human rights ad the rule of law.

To achieve the objectives, government was required to broaden the dialogue process to include all stakeholders and citizens, agree on milestones and time-frames, allow the parties to the dialogue to determine appropriate reforms and agree to ensure the processes take place in a conducive environment that’s open and enjoys legitimacy amongst the people of Swaziland and the region.

After government stalled talks over the loan, there was talk fuelled by the international media that Swaziland was looking elsewhere for a condition-free loan.

When Prime Minister, Barnabas Sibusiso Dlamini travelled to Qatar it was speculated that he was on mission to secure a loan. Government neither denied nor confirmed speculations.

By and large, government has not been free with information relating to the loan and that there were conditions attached to the loan was disclosed by the SA government.

With the veil of secrecy thrown around the loan, information comes in bits ad pieces. Swazi journalists have to rely for information from SA or pick it up from the SA media.

During the Smart Partnership Dialogue last year, the king made it clear that issues surrounding the loan were not for public consumption. He did not take kindly to questions raised by journalists on the loan.

Earlier, The Weekend Observer – the newspaper owned by the royal conglomerate; Tibiyo Taka Ngwane - had apologised for an article it published that the king had been to South Africa begging for the loan.

After the king rebuked journalists for enquiring, writing analysis and comments on the loan the little information from government simple dried up.

Minister Fakudze, while confirming he was in South Africa on the date or the day before, as he could not recall exactly when, said there was nothing to talk about on the loan. He said talks are continuing.

Governor of the Central Bank of Swaziland, Martin Dlamini, confirmed he was in South Africa on November 22 but not to discuss the loan. He was there for consultation with the SA Reserve Bank Governor.

The Department of International Relations and Cooperation in SA referred enquiries to the local Ministry of Foreign Affairs.

It is on record that Prince Mahlaba was not too excited that Swaziland had secured a conditional loan of E2.4 billion from neighbouring South Africa.

He said he would have to die first before the kingdom would accept the loan with its conditions which, if implemented, would unlock grip of the royal family over the country.

Motivated by the desire to protect the autocratic tinkhundla system of governance that ensures bread on his table, Prince Mahlaba said the loan would not be used by anyone to force Swaziland to pursue the democracy route.

The tinkhundla system was introduced in 1978 by Prince Mahlaba’s father, King Sobhuza II after he had proscribed political parties five years earlier. However, people like Prince Mahlaba have always said the political system came directly from God.

He is not the only one who thinks Swaziland is God’s chosen country with the royal family as his lieutenants watching over the kingdom.

His brother, Prince Masitsela, once announced that the royal family was closer to God and through it he communicates with the people.

Prince Mahlaba added his voice on the story of God and Swaziland. He says tinkhundla came from God and nobody has the right to change it. Understood correctly, he means the thousands of Swazis calling for dismantling of the system act against wishes of God.

He brought in the tired analogue of a poverty-stricken man who would give his wife to a neighbour as a condition for a loan.

To him, accepting the loan with its conditions would be equal to selling the country for E2.4 billion. Prince Mahlaba – a man seemingly obsessed by the status of being a prince - believes the tinkhundla system bred a God-fearing nation.

Needless to say, Prince Mahlaba was harshly criticised for his views. Government, as expected, opted to remain silent. It’s unSwazi and unprecedented for government to criticise royalty. It, however, dispatched a diplomatic note apologising to SA for the comments.