From Stagnation to Growth: Transforming Eswatini’s Agriculture for Profit and Resilience

Eswatini’s agriculture sector holds strong potential in high-profit value chains like vegetables, dairy, beef, and maize, but growth is hindered by structural inequality, weak market linkages, and inefficient public spending. The World Bank urges a shift to market-oriented, climate-resilient investments that integrate smallholders into competitive, value-added supply chains.

The World Bank’s Eswatini Agriculture Sector Review: Catalyzing Agri-Food System Transformation, prepared in collaboration with the Food and Agriculture Organization (FAO) and the International Fund for Agricultural Development (IFAD), provides an in-depth assessment of a sector vital to the nation’s economy yet underperforming in realizing its full potential. Agriculture contributed just over 7% to GDP in 2023, but it remains a pillar of rural livelihoods, food security, and export earnings. The report notes that Eswatini enjoys significant advantages through its membership in regional trade blocs such as the Southern African Development Community (SADC), the Southern African Customs Union (SACU), and the Common Monetary Area (CMA), and benefits from supportive policy instruments like the National Development Plan (2023–2028) and the Eswatini National Agricultural Investment Plan (ENAIP). Despite these strengths, sector performance has stagnated. Between 2010 and 2021, public agricultural expenditure more than doubled in real terms, yet agricultural output fell by 4%. The report attributes this paradox to structural inefficiencies, inflationary pressures, fragmented program design, weak market linkages, and chronic underfunding of support services.

Profitable Value Chains with Untapped Opportunities

The review identifies four commodity value chains, maize, beef, vegetables, and dairy, as the most promising engines of growth when managed effectively. Maize, a staple crop central to food security, delivers steady but modest returns and offers low barriers to entry for smallholder farmers. Beef production, particularly through feedlot systems, can achieve profit margins of around 21%, tapping into both domestic demand and regional export markets. Vegetables stand out as the highest-return option: cabbage cultivation delivers margins exceeding 67%, while carrots approach 52%, positioning horticulture as a strong driver of income growth and diversification. Dairy is similarly lucrative, underpinned by high domestic consumption and a persistent supply gap that creates room for competitive small-scale operations. However, most smallholders are excluded from these opportunities due to the high cost of inputs, limited access to affordable credit, inadequate value-addition infrastructure, and weak extension services that restrict productivity gains.

The Divide Between Large Estates and Smallholders

A central theme of the report is Eswatini’s dual agricultural structure. On one side are large, technologically advanced commercial estates located on Title Deed Land, producing roughly 80% of the nation’s agricultural output. On the other side are smallholders farming Swazi Nation Land, who depend on low-yield, rainfed subsistence agriculture. This divide entrenches inequality in access to resources, technology, and markets. The review underscores how public spending patterns reinforce this imbalance. Over 56% of agricultural investment is directed toward capital-intensive projects, especially irrigation, while research and innovation, agricultural extension, and veterinary services receive far less attention. Moreover, capital project execution rates have averaged only 42% between 2018 and 2023, limiting the impact of these investments. Programs such as the Input Subsidy Program are criticized for being poorly targeted and insufficiently integrated with broader market development efforts, reducing their ability to catalyze transformative change.

Lessons from Abroad and a Call for Market Orientation

The authors recommend a decisive pivot from input- and production-focused spending toward a systems-based, market-oriented investment model. This means aligning public resources with the needs of specific value chains, crowding in private sector investment through policy reforms and blended finance, and strengthening institutional capacity. Drawing from global experience, the report highlights Rwanda’s bundled crop support program, which integrates input provision, extension services, and market access; Kenya’s dairy sector, where cooperative and private partnerships link smallholders to processing and distribution; Ethiopia’s livestock master plan, which emphasizes evidence-based, long-term strategies; and India’s reforms enabling contract farming to attract private investment. These examples show how well-targeted policies and inclusive value chain strategies can unlock agricultural transformation.

A Roadmap for Inclusive and Climate-Resilient Growth

The review’s roadmap focuses on promoting smallholder commercialization through improved seed systems, targeted irrigation investments, and cooperative business models. It calls for building functional industry associations to support integrated value chains, fostering public–private dialogue to align market opportunities with policy action, and embedding climate-smart practices across the sector. Agricultural risk insurance schemes are recommended to shield farmers from climate shocks, while innovation hubs and incubation programs could accelerate technology adoption. The report urges the government to strategically reallocate resources: public goods such as rural infrastructure, agricultural research, and extension should receive adequate funding; catalytic investments should target youth, women, and market access initiatives; and private-sector-led areas, such as agro-processing, cold chain logistics, and export-focused production, should be supported through enabling regulations and investment incentives.

The overarching message is one of urgency paired with opportunity. Eswatini’s agriculture can become a dynamic driver of inclusive economic growth, job creation, and food security if the country shifts from fragmented, low-return projects to a targeted, profitability-driven transformation. Scaling up proven high-return interventions, dismantling systemic barriers, and integrating smallholders into vibrant, market-led value chains are key to closing the gap between potential and performance. The choice, the report concludes, is clear: persist with the status quo and risk continued stagnation, or embrace bold, coordinated action that redefines the role of agriculture in shaping Eswatini’s economic future.