Eswatini is a country standing at a crossroads — and increasingly, at the edge of a cliff. The latest World Bank data paints a stark picture: one in three citizens is unemployed and nearly half the population lives in poverty, surviving on less than $3 (about R50) a day. Youth unemployment hovers near catastrophic levels and the economy, though showing flickers of growth, remains too small, too fragile and too undiversified to absorb the thousands of young people entering the labour market each year.
Against this bleak backdrop, under the absolute leadership of King Mswati III since 1986, eSwatini government officials have signed a $300 million (12 billion Emalangeni) financing agreement with Taiwan for the construction of the Phuzumoya Strategic Oil Reserve — a project pitched as a cornerstone of national energy security. The deal, formalised in Taipei , commits eSwatini to a 36-month build of an 80 million litre fuel reserve, split evenly between petrol and diesel. It is the largest infrastructure financing agreement eSwatini has entered in years.
But the question that hangs over the announcement is unavoidable: Can a country battling deepening poverty and chronic unemployment afford such a project and can it afford not to? The project has become further mired in controversy amid allegations about the beneficiaries of the agreement. According to allegations circulating among activists and political insiders, the project could financially benefit members of the royal family and politically connected figures. The government denies the claims. After a controversial visit to eSwatini by Taiwanese President Lai Ching-te earlier this month, the Taiwanese agreed to increase the transfer of interests to the nation. Ambassador Liang Hong-sheng was reportedly instructed to inform the royal family that once the storage facility was built, the income would belong to the king and royal family. Members of the royal family, including the king and Natural Resources Minister Prince William Dlamini, will allegedly receive a pro rata share of the $300m investment. Liang will also allegedly receive $2.5m, to be administered by a Taiwanese businessman in eSwatini, with other officials and “green interest” groups set to benefit.
The king’s spokesperson, Percy Simelane, however, denied any wrongdoing, saying a feasibility study was conducted before the Phuzumoya Oil Reserve project received the green light.
“It had to be built only in the best interest of the country and anyone who thinks it’s a ploy to put money in the king’s pocket should consider seeing their doctor immediately.
“We understand we are living in a day where people are proud of what they should be ashamed of but lying unnecessarily appears satanic from where we stand,” Simelane said.
“It reminds us of the wickedness around the claim that Iraq had amassed weapons of mass destruction at the turn of the century. Over 20 years later, the United Nations has found nothing,” he added.
Lucky Lukhele, the spokesperson for the Swaziland Solidarity Network, said it was aware of the deal and others benefiting the king, the royal family and his ministers. “Poverty, healthcare, education and life in eSwatini is a battle for the poor, while the king and his people prosper,” he said. A nation under strain The World Bank’s latest indicators show a country in distress. Unemployment sits at 34.2%, one of the highest rates in Southern Africa. For young people, the picture is even more dire: more than half are locked out of the labour market, with little prospect of entry.
Poverty remains high. The most recent poverty headcount — although dated — shows 44.5% of the population living below the $3/day line and analysts warn that the figure has probably worsened after years of drought, rising food prices and sluggish economic performance. GDP per capita stands at $3 909 and while the economy grew by 3% in 2024, it is nowhere near enough to shift the structural foundations of poverty.
Lukhele said most were surviving on a “dollar a day”. The country’s demographic profile adds pressure: a population of 1.24 million, growing at 1% annually, with a youth bulge that the economy cannot absorb. Net migration remains negative, with thousands leaving each year in search of work in South Africa.
The numbers are not abstract. They translate into households skipping meals, young graduates sitting idle and rural communities trapped in cycles of deprivation. They also translate into political risks, a reality the government is acutely aware of.
Poverty and unemployment have no nationality, Simelane pointed out. “Every country has its share of the two, irrespective of geographical location. First-world countries have their own poor and unemployed people. “Europe alone has over 45 million unemployed people who should be working. There are beggars in New York, Paris and London. We, therefore, have no reason to think our own unemployed and poor people should be a poverty point of reference. “Our experience is that the accusations of extreme poverty in eSwatini come from cheap politics. In this country, farming, fuel, staple food, bread and healthcare are all subsidised by the government. The elderly (over 60 years) do not pay medical bills in public hospitals.”
It was against this backdrop that eSwatini’s minister of natural resources and energy travelled to Taiwan to sign the financing agreement for the Phuzumoya Strategic Oil Reserve, originally struck in 2023 and agreed late last year.
The reserve will store 80 million litres of fuel, enough to cover roughly 60 days of national consumption. Government officials argue that the project is essential to shield the country from global supply shocks, price volatility and geopolitical disruptions — all of which have intensified since the Russia-Ukraine war and instability in the Middle East.
Taiwanese contractors have confirmed a 36-month construction timeline, with the project expected to create up to 800 jobs during the build phase. The financing structure, while not fully disclosed, is understood to involve concessional terms through Taiwan’s Export–Import Bank.
For eSwatini, the project is more than an engineering undertaking. It is a diplomatic signal — a reaffirmation of its long-standing alliance with Taiwan at a time when Beijing continues to aggressively court African states. It is also a political signal: a demonstration that the government is pursuing “big solutions” to national vulnerabilities.
But critics argue that the timing is questionable and concerns around the beneficiaries dominate. With poverty deepening and unemployment entrenched, they ask whether the billions committed to the oil reserve could have been better spent on job-creating sectors, social protection or agricultural resilience. A fragile economy betting on stability Eswatini’s economic fragility is not new. The country remains heavily dependent on Southern African Customs Union revenues, which fluctuate with South Africa’s economic performance. Public debt, at 35.7% of GDP, is manageable but rising. Inflation is relatively low at 2.6% but food inflation bites hardest for the poor.
The government’s argument is that without energy security, no economic recovery is possible. Fuel shortages, which eSwatini has experienced before, can cripple transport, manufacturing, agriculture and essential services. A strategic reserve, they say, is not a luxury but a necessity.
Economists are divided. Some agree that the reserve is a long-term stabiliser that could prevent catastrophic disruptions. Others warn that infrastructure alone cannot fix structural unemployment or lift households out of poverty. Communities waiting for relief In rural areas, where poverty is most concentrated, the oil reserve announcement has landed with mixed reactions. Some welcome the promise of jobs during construction.
Others see it as another example of the government investing in concrete while communities struggle with food insecurity, limited access to electricity and inadequate sanitation.
The World Bank data shows that 61% of the population has access to safely managed sanitation and 86.4% to electricity — improvements but unevenly distributed. Internet access has risen to 63% but digital inclusion has not translated into digital employment. For many households, the crisis is immediate: rising food prices, erratic rainfall and limited income opportunities. The oil reserve, they say, does not change their daily reality. A government under pressure The government faces a difficult balancing act. It must demonstrate fiscal discipline to international lenders, maintain diplomatic alliances and respond to domestic pressures for jobs and relief. The oil reserve project allows it to claim progress on energy security — a tangible, measurable achievement.
But the deeper crisis, the one reflected in the World Bank’s stark numbers, requires more than infrastructure. It requires structural reforms, investment in labour-absorbing sectors and a social protection system capable of cushioning the most vulnerable.
But many, like Lukhele, insist the king and all his men have forgotten the poor, while enriching themselves. Higher Education Media Services. – ednews.africa