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Lesotho signs M1, 89 billion loan agreements

Bereng Mpaki

FINANCE Minister Moeketsi Majoro yesterday signed two loan agreements worth US$128 million (about M1, 89 billion) for a lowlands water project and an agricultural project in Maseru.

The funds are from the World Bank and the government of Japan, who were represented at the ceremony.

Part of the funding (US$78 million) is for the second phase of Lesotho’s Lowlands Water Development Project (LLWDP II) which is meant to improve living standards and address water challenges for domestic and industrial use in Maputsoe and Hlotse.

Surrounding areas such as Ha-Setene, Sebothoane, Ha-Lesiamo, Khanyane, Tsikoane, St Monica’s and Mpharane will also benefit from the project.

It includes civil and ancillary works for the provision of water facilities. The project will construct a raw water intake on Hlotse River, construct a water treatment plant with the capacity of 25 million litres per day, construct a water pipe to transfer raw water to the treatment plant, construct a water transmission pipeline for treated water from Hlotse to Maputsoe, construct a water pumping station and a pipeline for pumping water into the water reservoirs in Maputsoe and Hlotse. The project will also construct the distribution network across Maputsoe and Hlotse.

The second funding of US$50 million from the World Bank is for the second phase of the Smallholder Agriculture Development Project (SADP II), which aims to improve and increase agricultural productivity in smallholder agriculture sector.

The project will help Lesotho increase the adoption of climate smart agricultural technologies and enhance the commercialisation of agriculture. It will also strengthen market linkage development and market orientated faming with aim of creating sustainable market systems for agriculture products in the country.

A further M28, 9 million grant was extended by the government of Japan towards the improvement of agricultural productivity, commercialisation and nutrition.

The grant, extended under the Policy and Human Resources Development Fund, will also enable famers to capitalise on the availability of irrigation and training in climate smart agricultural technologies for on the ground productive and sustainable investments.

Speaking at the signing ceremony, Dr Majoro said the signing would facilitate the implementation of the project.

“This water funding we are signing for today is going to supplement the earlier funding that was extended by the European Union through the European Investment Bank (EIB),” Dr Majoro said.

For her part, World Bank country representative Janet Entwistle said the project would support Lesotho’s economic development as water is a key driver.

“These two projects will encourage economic growth and promote job creation by improving productivity in the agricultural sector and increasing water supply for economic activities and household use,” Ms Entwistle said.

They will also lead to improved nutrition among Basotho. I would like to congratulate and thank the government of Lesotho as well as the development partners, the European Union, the International Fund for Agricultural Development and the Japanese Policy and Human Resource Development Fund, for the work that went into preparing these beneficial projects. We look forward to great collaboration in implementation,” she added.

Also present at the signing ceremony were Water minister, Samonyane Ntsekele, Agriculture minister Mahala Molapo and EU ambassador Christian Manahl.

Part of the funding towards the water project is financed by the EU through the European Investment Bank (EIB) loan amounting to €41 million (about M615 million) while €41 million (about M615 million) is an EU grant.

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