Eswatini, a small, predominantly rural, landlocked country surrounded by South Africa and Mozambique, suffers from severe poverty and the world’s highest HIV/AIDS prevalence rate. A weak and deteriorating economy, high unemployment, rapid population growth, and an uneven distribution of resources all combine to worsen already persistent poverty and food insecurity, especially in rural areas. Erratic weather (frequent droughts and intermittent heavy rains and flooding), overuse of small plots, the overgrazing of cattle, and outdated agricultural practices reduce crop yields and further degrade the environment, exacerbating Eswatini's poverty and subsistence problems. Eswatini's extremely high HIV/AIDS prevalence rate – more than 28% of adults have the disease – compounds these issues. Agricultural production has declined due to HIV/AIDS, as the illness causes households to lose manpower and to sell livestock and other assets to pay for medicine and funerals.

Swazis, mainly men from the country’s rural south, have been migrating to South Africa to work in coal, and later gold, mines since the late 19th century. Although the number of miners abroad has never been high in absolute terms because of Eswatini's small population, the outflow has had important social and economic repercussions. The peak of mining employment in South Africa occurred during the 1980s. Cross-border movement has accelerated since the 1990s, as increasing unemployment has pushed more Swazis to look for work in South Africa (creating a "brain drain" in the health and educational sectors); southern Swazi men have continued to pursue mining, although the industry has downsized. Women now make up an increasing share of migrants and dominate cross-border trading in handicrafts, using the proceeds to purchase goods back in Eswatini. Much of today’s migration, however, is not work-related but focuses on visits to family and friends, tourism, and shopping.

A small, landlocked kingdom, Eswatini is bordered in the north, west and south by the Republic of South Africa and by Mozambique in the east. Eswatini depends on South Africa for a majority of its exports and imports. Eswatini's currency is pegged to the South African rand, effectively relinquishing Eswatini's monetary policy to South Africa. The government is dependent on customs duties from the Southern African Customs Union (SACU) for almost half of its revenue. Eswatini is a lower middle income country. As of 2017, more than one-quarter of the adult population was infected by HIV/AIDS; Eswatini has the world’s highest HIV prevalence rate, a financial strain and source of economic instability.

The manufacturing sector diversified in the 1980s and 1990s, but manufacturing has grown little in the last decade. Sugar and soft drink concentrate are the largest foreign exchange earners, although a drought in 2015-16 decreased sugar production and exports. Overgrazing, soil depletion, drought, and floods are persistent problems. Mining has declined in importance in recent years. Coal, gold, diamond, and quarry stone mines are small scale, and the only iron ore mine closed in 2014. With an estimated 28% unemployment rate, Eswatini's need to increase the number and size of small and medium enterprises and to attract foreign direct investment is acute.

Eswatini's national development strategy, which expires in 2022, prioritizes increases in infrastructure, agriculture production, and economic diversification, while aiming to reduce poverty and government spending. Eswatini's revenue from SACU receipts are likely to continue to decline as South Africa pushes for a new distribution scheme, making it harder for the government to maintain fiscal balance without introducing new sources of revenue.