South Africa and Swaziland have signed a memorandum of understanding relating to a R2,4 billion bailout for Africa’s last absolute monarchy, although the actual loan agreement has not yet been signed.

“The financial authorities of the two countries are still discussing the matter of the loan,” South African Treasury spokesman Jabulani Sikhakhane said.

A South African government source said the MoU signed by the two countries covered “matters of assistance” relating to the loan. He gave no more details.

The loan was initially negotiated a year ago when Swaziland’s government was in the depths of a funding crisis caused by a slump in revenues from a regional customs union that have normally accounted for two-thirds of its income.

However, the loan was not immediately signed by Swaziland because of its objections to Pretoria’s imposition of conditions relating to political and economic reforms in the southern African kingdom, where political parties are banned.