Eswatini Parliament sets 12-month exit deadline for foreign owners

Eswatini's Parliament has agreed on a minimum 12-month exit period for foreign business owners affected by the Citizen Economic Empowerment Act, settling a dispute over whether departing traders should receive three years to train local successors.

For the landlocked kingdom's retail sector, the compromise provides a transition rather than an immediate departure, but it does not guarantee that enforcement will wait: the trade ministry could keep applying existing law unless officials formally amend it.

Parliament in the tiny, landlocked kingdom approved the measure under King Mswati III, described as Africa's last absolute monarch. It seeks to give emaSwati, the name for citizens of Eswatini, greater access to sectors traditionally dominated by foreign operators and businesses the state wants to reserve or reopen for local ownership.

Shops owned by Asian nationals featured prominently in the initial closures, although the legislation reaches beyond them and targets foreign participation generally. The change also answers complaints from local traders that foreign businesses expanding in traditional retail markets had intensified competition and threatened livelihoods.

Who does the law affect in practice?

Parliamentarians asked whether local entrepreneurs were ready to take over affected operations. Their concern left a practical question unresolved: access for new local owners may depend on successors being able to run the businesses they take over.

• Affected foreign owners: Parliament's agreement sets a minimum 12-month period to exit and prepare local successors.
• Trade ministry: Current law remains available for enforcement unless it is formally amended to reflect the parliamentary agreement.
• Local traders: The policy reserves or reopens targeted sectors for emaSwati participation and seeks to ease their competitive concerns.

The distinction matters commercially because a parliamentary minimum does not itself suspend existing enforcement powers. Foreign owners cannot treat the 12-month agreement as a guaranteed pause unless and until the ministry changes the rules, while local traders cannot assume every available business will have a ready successor.

Why did Parliament choose 12 months?

Mbabane East MP Welcome Dlamini proposed a three-year runway. He asked: “Why can't we give the Asians or foreigners at least three years before 'kicking them' out so that emaSwati can learn to run the businesses?”

Hhohho Regional MP Tanele Magagula opposed that delay, asking: “Why must we wait for three years while emaSwati suffer?”

Parliament ultimately agreed on the minimum 12-month exit period. The compromise was shorter than the three years Dlamini sought, but it established a transition period during which foreign owners must leave and local participants can prepare to succeed them.

What does implementation mean for traders?

The law's commercial reach is broader than the initial wave of Asian-owned shop closures. It applies to foreign participation in any sector Eswatini decides to reserve or open to citizens, so operators need to determine whether their activities fall within protected local markets rather than assume the measure concerns retail shops alone.

A 12-month exit window can allow time for ownership succession, but Parliament's debate showed that the timetable alone does not solve the handover problem. Lawmakers disagreed over both the length of the runway and whether emaSwati were prepared to take over the businesses.

South Africa has also tightened restrictions on foreign traders and pursued policies intended to increase local participation in township businesses, including tighter spaza shop registration and funding programmes reserved for qualifying South African-owned businesses.

Anti-immigration and anti-foreign business sentiment intensified during 2026. In April and May, demonstrations organised by anti-immigration groups including March and March spread across Johannesburg, Pretoria and Durban, where foreign-owned shops were targeted in violent attacks.

Human Rights Watch reported that foreign nationals were assaulted and threatened during the unrest, sometimes with little police intervention. The group's findings underline a risk that regulatory pressure and street action can converge around the same traders.

The confrontation escalated in July, when more than 900 people were arrested during nationwide anti-migrant protests. Foreign-owned shops were looted, and one person was shot dead in Johannesburg.

Fresh demonstrations in Soweto and Durban in October again resulted in shop closures, looting and threats against immigrant traders, extending a pattern of disruption that has accompanied South Africa's demands for greater economic participation by citizens.

The enforcement drive has also raised concerns about the treatment of foreign traders, including those legally entitled to operate. Eswatini's law follows this wider tightening, although the two countries' approaches differ: Eswatini uses a legislative exit period, while South Africa combines registration rules, targeted funding and public pressure.

What happens next?

The next phase will turn on whether Eswatini's trade ministry formally amends existing law to reflect the 12-month minimum, and which sectors qualify for reserved or expanded emaSwati participation. In South Africa, further tightening of spaza registration and access to reserved funding could accelerate the replacement of foreign-owned shops, while another round of anti-migrant demonstrations could interrupt trading again.

The policy trajectory is therefore toward tighter local control of business ownership, with the timing of Eswatini's exit rules and the reach of South African registration and funding tests still decisive.