Eswatini as an Emerging Market for Investors

As this transformation is being undertaken, there is need to focus on the factors deemed important to foreign investors when assessing which countries or regions to invest.

Investors, as Jacques Magliolo notes in his book, “The Millionnaire Portfolio,” assess emerging markets by rating such regions according to their own set of criteria, which were designed after 1997 emerging market crash to diversify risk across world emerging regions.

An assessment of these criteria indicates that the majority of foreign investors look at whether the area is undergoing the following;

1. A visible deregulation of previously state-controlled industry (for instance, petroleum, cement and telecommunications)
2. The undertaking and caring out of privatisation of state-owned utilities.
3. A concerted government effort to remove trade barriers.
4. The implementation of tight fiscal and monetary policies.
5. The removal of exchange controls as a priority.
6. The development of a skilled labour force as a government priority.
7. Sustained long-term GDP growth of 3% to 4%.
8. A move towards stability, both economically and politically.

Jacques concludes, “Consequently, foreign investors invest in regions that undertake the above measures. As such, infrastructure, building, banking, retail and telecom shares obviously make up the first set of recommendations”

Entrepreneurial ecosystems that have attracted global investors, including venture capitalists, have five things in common which StartupBlink’s Global Startup Ecosystem Index (GSEI) uses to do startup ecosystem rankings of 1,000 cities and 100 countries with the most advanced ecosystems;

1. Ease of doing business ranking is excellent.
2. Regulatory and infrastructural support is world-class.
3. High number of startups, accelerators, co-working spaces, investors, and startup events.
4. High quality startups within the ecosystem, driven by factors like venture capital funding.
5. Excellent Global Innovation Index ranking.

The eight factors mentioned previously, together with the five outlined above, should serve as a guiding framework for the Eswatini Government in restructuring its investment offerings. Follow Pinaco & Co to appreciate significant efforts the company is taking to bring venture capital funding into Eswatini to scale high-growth startups, create jobs for Emaswati and grow our economy.

“If not us, who? If not now, when? – John F. Kennedy.