Finance Minister Pravin Gordhan on Thursday defended a controversial R2.4-billion bail-out for Swaziland and said he hoped it would encourage democratic shifts in Africa's last absolute monarchy.
South Africa has come in for criticism over the loanword from Swazi activists, who had lobbied Pretoria to recoup the bail-out until Swaziland's King Mswati III agreed to democratic reforms.
"Will this loan encourage genuine change? We desire so," Gordhan told journalists.
"I believe it's in the interests of Swaziland that there are changes in that state which are compatible with what the Swazi population want, which allows for loose and overt political activity and . respect for the status of his majesty on the one paw and democratic institutions on the other hand.
"But that's for the Swazi people to actually get for themselves."
The South African authorities is acting as guarantor to the R2.4-billion loan from the Reserve Bank to the exchange trust of Swaziland, backed by payments from a regional customs union.
Gordhan said the loan would be paying out in three stages, each conditional on fiscal reforms agreed by Swaziland and the International Monetary Fund (IMF).
"All of those things will own to be delivered as each tranche requires," he said, adding that political changes were also partly of the deal.
The loan also requires Mswati to open talks on political reforms in the tiny landlocked kingdom, which shares a ring with South Africa.
"We must repeat that it's not in South Africa's interest to get a collapsing Swaziland economy," said Gordhan.
Swaziland has been battling to remain solvent after losing 60% of its revenues from a regional customs union, the government's primary reference of income, last year.
Dissidents want Mswati to legalise political parties, which were prohibited in 1973, and send to a transitional governance and elections within 4 years. - AFP
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