Johannesburg - European Union taxpayers’ money is being used to finance the lavish lifestyle of Swaziland’s royal family, an investigation by the Danish NGO Afrika Kontakt has revealed.
Afrika Kontakt’s report: "The European Union in Swaziland: In support of an Authoritarian King?" says EU money ‘benefits the Royal Family greatly’ and undermines democratic forces in Swaziland.
The EU spent 120 million Euros (about R1.8 billion) to improve the competitiveness of Swaziland’s sugar industry in the ten years up to 2017.
Sugar accounts for almost 60 percent of the agricultural output and 16 percent of employment in the kingdom.
The sugar industry in Swaziland is dominated by Tibiyo TakaNgwane, a royal investment company that the King holds "in trust for the Swazi nation".
Tibiyo owns 50 percent of the Royal Swaziland Sugar Corporation (RSSC) and 40 percent of Ubombo Sugar Ltd (a subsidiary of the South African-based Illovo company), the industry’s major players.
Tibiyo also has stakes in sugar estates and haulage companies and has a 30 percent share in FINCORP, which provides loans to small-scale sugar farmers with interest rates above 20 percent.
Afrika Kontakt said the Swaziland sugar industry mirrored Swazi society by being largely owned by the royal family through various companies and investment funds, and by the royal chiefs playing an important role.
It added the purpose of EU funding was to increase the competitiveness of the sugar industry.
“However, a large percentage of the funds have benefitted the two major sugar millers RSSC and Ubombo Sugar Ltd, and their major shareholder the royal investment company Tibiyo TakaNgwane.”
According to the report, EU funding had helped subsistence farmers, but had also enriched chiefs through the payment of royalties and Royalty-affiliated haulage companies.
Afrika Kontakt said Tibiyo’s ownership in RSSC secured it a dividend payment of E98 million (R14.6 billion) in 2015-16.
Ownership of Illovo paid out E15 million as dividend in 2012-13. Illovo is no longer listed so it is impossible to find information about more recent payments.
Afrika Kontakt reported Tibiyo is controlled by King Mswati III and Freedom House has reported it is an open secret in Swaziland that the Royal Family uses the fund to pay for personal expenses.
The Managing Director of Tibiyo, A T Dlamini, is a former Prime Minister and the board consists of several members of the Royal Family.
Afrika Kontakt said: "The sugar industry in Swaziland is structured so that external assistance from the EU to the industry ends up benefitting the last absolute monarch in Africa."