Swaziland Sells Its First Government Bond, Plans Longer-Term Debt Issues

Swaziland yesterday sold its first bonds to raise money for development projects and plans further sales this year, a central bank official said.

The Central Bank of Swaziland sold 250 million elangeni ($34 million) worth of three-year bonds yesterday. To date, the bank has only sold short-term debt in the form of Treasury bills.

“Yesterday was the first time the central bank has released a three-year bond,” Phumzile Mkhatswa, a domestic debt officer at the Mbabane-based bank, said in an interview today. “We plan to issue five-year and 10-year bonds before the end of this year.”

Swaziland, a landlocked nation of 1.3 million people bordered by South Africa and Mozambique, is a monarchy and depends on exports of sugar and wood pulp. The central bank had outstanding government securities worth 383.2 million elangeni in June, the central bank said on its website.

The bonds are “intended to raise money for the Kingdom of Swaziland’s development projects,” Mkhatswa said, without providing further details.

Yesterday’s bond sale attracted 519 million elangeni in bids, the central bank said. The bonds have a coupon of 8 percent.

The Swazi lilangeni is pegged to the South African rand at parity. Elangeni is the plural of lilangeni.

To contact the reporter on this story: Brian Latham in Durban at blatham@bloomberg.net.

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