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On Saturday January 21 2023, Eswatini ’s leading human rights lawyer was assassinated in his living room. It was a quiet summer evening in a sleepy village on the hills not far from the capital Mbabane, and Thulani Maseko and his family were watching television when the unknown killer fired shots. This followed just hours after King Mswati III had warned in a public address to his traditional regiments that mercenaries would deal with those calling for democratic reforms, according to international NGO Human Rights Watch.

The lack of a credible independent investigation has fuelled speculation that agents of Mswati or his state murdered Maseko. He was, after all, a thorn in the side of the Swazi regime, holding together the pro-democracy Multi-Stakeholder Forum, an organisation challenging the one-man rule of Mswati.

Maseko was, by all accounts, the kind of person to lead a free Eswatini in future, and he would have been an able drafter of a democratic constitution. As it was, he had led many legal challenges to Mswati’s authority — including one taking on the king’s unilateral decree that Swaziland be renamed Eswatini on his 50th birthday, in April 2018. Mswati, it seems, had been inspired by a fantastical vision of command from God, leading him to declare the country a “monarchical democracy”.

Mswati is not one for the niceties of democratic and public consultation, which the country’s current, if flawed, constitution requires as a minimum for decisions such as these. Hence the legal challenge.

Maseko’s case was never heard in court, but it undoubtedly stoked the ire of a king who seems most comfortable atop his throne of crushed red velvet and gold leaf trimmings, exchanging pleasantries with visiting heads of state.

Mswati’s paradoxical “monarchical democracy” is really a front for one-man rule. It offers the promise of a constitution and an elected parliament (the Tinkhundla). However, political parties are banned and the king’s powers are ultimately not fettered by the constitution. As opposition leader Lucky Dlamini wrote in Workers World News during the most recent parliamentary elections in September 2023: “The Tinkhundla elections remain meaningless as they serve to legitimise a powerless parliament that has no power to hold the executive accountable and has no legislative authority.”

This week the International Consortium of Investigative Journalists (ICIJ) and seven media partners, including  Open Secrets, publish Swazi Secrets, based on more than 890,000 leaked documents that originate from the Eswatini Financial Intelligence Unit. The leak is the largest of its kind from a financial intelligence unit in an African country. Reporting based on the leaks reveals the vulnerability of Swazi financial institutions to predatory behaviour by politicians and corporations alike.

The ramifications of this extend beyond the borders of Eswatini, with a risk that financial institutions may be manipulated with the intention of fuelling money laundering and organised crime across the region. South Africa would not be immune from this.

Open Secrets will explore some of these themes in the FM. But none of this can be properly comprehended without appreciating the central role that the king plays in both political life and the economy of Eswatini.

As a 2017 World Bank report taken from the ICIJ leaks presciently advised, the centralisation of authority in one individual makes Eswatini vulnerable to corrupt financial networks.

The royal purse is funded largely by the Swazi state and royal investment fund Tibiyo Taka Ngwane

A gilded throne

Mswati draws his “legitimacy” from Eswatini’s rich cultural heritage, arguing that it gives him a monopoly over power. However, it has given him more than just political power — there’s also the wealth he shares among his large royal household. Whether wearing traditional Swazi clothing or a tailored suit, the king and many of his wives almost always sport European luxury watches worth tens of thousands of dollars.

Mswati is a king in the mould of modern-day Emirati royalty: he and his family display an unfettered appetite for fast cars, fancy watches and designer garb. In contrast to lazy European royalty who have limited political power and survive largely on intergenerational wealth and public handouts, Mswati and his family are ostensibly in a phase of rapid accumulation and consumption aided by effective control of the state. 

The royal purse is funded largely by the Swazi state and royal investment fund Tibiyo Taka Ngwane (Tibiyo). This cash cow was created under British colonial occupation to assist the government in providing for the needs of emaSwati. However, far from serving the broad public, its primary beneficiary today appears to be the royal household, a source close to the royal family tells Open Secrets.

The fund holds extensive shares across all major economic sectors. As the World Bank notes in a 2017 report, “Tibiyo owns urban property and farms on Title Deed Land and has become a vehicle for the royal ownership of most shares in Eswatini’s larger companies”.

Tibiyo is thus perhaps best understood as a royal empowerment vehicle that allows the king to muscle in on any form of legitimate economy activity. Its 2022 annual report lists 21 companies in which the king holds shares.

This is all particularly relevant when new licences are issued (think mobile telephony, gambling or tourism) and in the agricultural sector, where it is within the king’s power to seize land. There are obvious reasons why most corporations accommodate power by ensuring that the king or Tibiyo remain satisfied shareholders.

While Tibiyo claims that social investment is the core of its business and it strives to maximise wealth to develop the nation, the king is its sole trustee, and both he and the fund are exempt from paying tax.

The king is also believed to own direct shares in various entities, such as a lucrative 10% slice of MTN Eswatini, a subsidiary of the MTN Group. The company’s website does not name Mswati, but lists ownership of these shares to an “esteemed shareholder” — parlance for the king.

Anger rises

In contrast to the king’s wealth, the Swazi people largely live in poverty. A 2022 Bertelsmann Foundation report on democratic transformation found that 59% of people live in abject poverty, surviving on less than $2, or R37, a day. This served to fuel the pro-democracy protests that swept across Eswatini in 2021. The protests — a response to police brutality — were quickly followed by calls for democratic reforms in the country.

The response by Mswati’s government was swift and violent; 80 people were killed by security forces and hundreds injured, Amnesty International reported. In late June protests were banned and it was prohibited to deliver petitions to parliament. This was followed by a government directive ordering companies such as South Africa’s MTN to shut down telecom and internet services in an attempt to throttle communication during the most successful challenge to the monarchy in recent times.

During the stand-off BBC News interviewed young protesters, who drew attention to the extreme wealth disparity between the royal family and the Swazi people. “The poverty levels are scary. You can just see it as you’re driving on the road. Who even still lives in a stick and mud house now? … And then you’re [the royal family] going to flaunt your wealth every chance you get.”

Worryingly, as the Swazi Secrets leaks suggest, Eswatini risks becoming a haven for hot money

South Africa: big brother and bankroller

While the king relies on the largesse provided by Tibiyo and the state, Eswatini has a benefactor in South Africa. The Swazi lilangeni is pegged at parity to the rand through the Southern African Customs Union (Sacu).

The most recent financial year was a bumper period for Eswatini as its Sacu revenue nearly doubled to E11.75bn. This is the largest receipt yet from Sacu and largely paid by South Africa.

Despite this, Sacu revenue to Eswatini is on the decline. This suggests trouble ahead, given that the country continues to source the bulk of its income from the regional mechanism while public spending (including on the royal household) is on the increase. In an attempt to attract companies to set up shop in Eswatini, finance minister Neal Rijkenberg — who also owns the largest timber company in the country — has cut corporate taxes to 25%. However, there is little evidence that this has served to generate significant new legitimate economic activity. 

A haven for hot money?

Worryingly, as the Swazi Secrets leaks suggest, Eswatini risks becoming a haven for hot money. As Open Secrets will explore in the next instalments in this series, Eswatini appears to be attracting a new group of grifters who enjoy an element of political protection.

Given the parlous state of the country’s finances, the overt political repression and the central role of the king in political life, there is a risk that public institutions may well be captured by some of these interest groups. Like the Guptas in South Africa, they may come out of nowhere, but, protected by a corrupt principal, their impact for Eswatini and the region could be devastating.

Read the next story in the series: “Swazi Secrets Part 2: The Construction Kingpin

Read the next story in the series: Swazi Secrets part 3: How to capture a bank

* Open Secrets is a nonprofit organisation that exposes and builds accountability for economic crimes. Support Open Secrets

Swazi Secrets explained

Swazi Secrets is a cross-border investigation that reveals Eswatini’s unexplored role as a conduit in Southern Africa’s gold-based money-laundering economy — and how the absolute monarchy’s weak anti-money-laundering controls enable figures close to the royal family to benefit from proximity to the king.

The leak is the largest of its kind from a financial intelligence unit in an African country. The documents include bank records, police investigation reports, court affidavits and transcripts, and confidential exchanges between government agencies within Southern Africa. The records also include details about banks around the world that have facilitated financial transactions for people and companies suspected of criminal activity. The documents comprise more than 890,000 internal records from the Eswatini Financial Intelligence Unit (EFIU) obtained by Distributed Denial of Secrets, a nonprofit devoted to publishing and archiving of leaks, which shared them with the International Consortium of Investigative Journalists (ICIJ). ICIJ co-ordinated a team of 38 journalists from 11 countries to investigate illicit financial flows in Southern Africa and beyond.

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