By Delisa Thwala
First National Bank (FNB) Eswatini’s preferential procurement strategy through the ‘Buy Swati’ programme saw a total of E277 million paid to Eswatini in its financial year, making up 85 per cent of operational procurement spend.
This information was shared by FNB Eswatini Chief Executive Officer (CEO) Dennis Mbingo. He was speaking on Wednesday at the launch of the yearly Entrepreneur of the Year Awards (EYA).
Mbingo revealed the bank was in tune with supporting local suppliers and buying Swati. His statement was supported by E1.6 million they sponsored EYA as a title sponsor, an increase from the E 1.5 million they sponsored last year.
As part of its shared value creation intent, the bank has over the years prioritised Eswatini suppliers to help support local economic growth and job creation.
The bank’s report to society shows that the single biggest spend was E60 million paid to contractors for its new head office at Ezulwini.
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This E250 million project targeted at least two-thirds of the final spend to go to Swati companies. As of June 2022, that target was on track as the total project spend was 71 per cent local.
In his comments, Mbingo mentioned that this remains an important part of their shared value creation strategy, but it was harder to achieve than when the programme was first rolled out.
“We have had some success with localisation, but I am still of the view that it could be better, especially where local prices can be better managed, even with costs of logistics built in. We have even improved the quality of local workmanship for basic business needs due to this focus,” said Mbingo.
When FNB Eswatini released its 3rd Annual Report to society it narrates how the bank has invested effort in creating shared prosperity for its stakeholders, alongside building a banking franchise that provides services and product returns that make a difference to the everyday experience of its customers.
As part of their effort to ease access to finance for small to medium-sized enterprises, we have introduced a funding model that relies on the businesses’ transactional history and behaviour with FNB instead of financial statements.
A total E60 million had been allocated to the initial spend on this funding accelerator model in its first year. Investing in the economy deploying their balance sheet to drive economic growth.
“Being part of a developing economy means that our financial resources, as represented by our balance sheet, must be deployed in a manner that is sensitive to the needs of the economy and driven by a clear need that sustained growth has to be inclusive,” said the CEO.
An active drive to promote the majority of FNB spending towards local investment and buying Swati has been successful according to the CEO.
Worth mentioning is that FNB Eswatini created a website to support businesses that wish to increase their access to a wide customer pool and to assist buyers who need to find products and services quickly.
FNB-banked customers are encouraged to list their businesses for free on Eswatini Market Square to help potential customers find them easily.
On this initiative and huge spending by FNB, Minister of Commerce, Industry, and Trade Manqoba Khumalo said a core principle of AFRI capitalism is the need to empower African, Eswatini entrepreneurs, ensuring that they can unleash their potential to create and grow their businesses to build more diverse and resilient economies.
He said with the high level of unemployment and lack of employment opportunities for Eswatini’s youth, formal employment in the private sector is proving to be an impossible route to absorb the many emaSwati entering the job market every year.
Meanwhile the Eswatini Economic Policy Analysis and Research Centre (ESEPARC) recent seminar on ‘Rethinking Your Regular 8-5’ presented an opportunity for young people to come together and share ideas
on how they can use their time productively so that even if they are not formally employed, they find opportunities to engage in productive economic activities between 8am – 5pm and beyond.
WHY YOU SHOULD BUY LOCAL
How many of you have been exposed to flavoured honey in Eswatini? Through this young trio, flavoured honey will soon become a staple in a lot of emaSwati’s kitchens.
This is a lesson to a lot of young people out there who have skills from their tertiary education that they need not put these skills at bay while they wait for someone to employ them.
Young people should use their skills to test new business ideas within the different sectors of the economy so that they can eventually find niche and unanchored markets to serve people’s needs.
In doing so, not only can they make money, but they will be recreating their own 8-5 by using their skills to be their bosses. In other words, young people should challenge themselves to see the bigger picture and think about a new productive 8-5 by venturing into the self-employment sector.
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Another example of a young person testing the waters in the business sector because of the formal employment doors that shut out a lot of young people is how Mvula Natural Products came to be.
While Nomvula kept waiting for human resource managers to call her back to tell her that she had been shortlisted for an interview or that she got the job,
she also noticed an increase in the number of people wanting to grow natural hair and thus decided to venture into producing natural hair products to boost her income.
Like Bee Happy, she also uses locally sourced agricultural produce such as avocados and lemons to make her natural hair products.
“My products do not have the harmful chemicals most commercial hair care products contain,” she boasted.
Buying behaviours are indeed changing, and the world is now hungry for environmentally safe products that can be part of the growing green economy.
Following in the same footsteps, Soap Factory Eswatini, a company that produces quality biodegradable cleaning solutions, took on the challenge.
As a first step, there is a need to promote locally-made products in Eswatini and prioritise these products in our daily shopping lists.
ESEPARC has said it before, we vote for jobs in Eswatini when we buy locally produced goods and services. By doing so, we will unleash the potential of our entrepreneurs and further create the value of Lilangeni within Eswatini and in turn induce economic growth.
It begins with you. Need honey? Order it from Bee Happy! Need soap? Call the Soap Factory! On your next shopping trip, just make sure to buy local! Let the money circulate in the Eswatini economy.
|
PROCUMENT SPEND ON SERVICES AND CAPITAL ITEMS |
ESWATINI |
FOREIGN |
TOTAL |
|
Specialized systems and technology development costs |
E 116.9 million |
E 6.9 million |
E123. 8 million |
|
Technology Network services |
E 7.8 million |
E 42. 5 million |
E 50. 3 million |
|
Infrastructure maintenance |
E 1. 6 million |
E1. 8 million |
E 3.4 million |
|
Other services |
E 73. 5 million |
– |
E 73. 5 million |
|
Progress payments for new head office |
E 60 million |
– |
E 60 million |
|
Motor vehicle additions |
E1. 9 million |
E 3.3 million |
E 5.2 million |
|
Branch renovations |
E 14. 8 million |
E 16. 2 million |
E 31 million |
|
Total Procurement spend |
E 276. 5 million |
E 70 .07 million |
E 347.2 million |