THE United States (US) has warned that Lesotho risks losing out on the multi-million-dollar second compact under the Millennium Challenge Corporation (MCC) due to concerns about corruption, police brutality against citizens and the failure to stay the course on the implementation of the multi-sector reforms.
The warning was delivered this week by the MCC delegation that was recently in the country for high level consultations with Deputy Prime Minister Monyane Moleleki, opposition leaders and other stakeholders.
The consultations are part of the processes that are expected to lead to a definitive agreement on the size of the financial package which is expected to remove obstacles and spur private sector-led economic growth.
The MCC is a multilateral American foreign aid agency established by the United States Congress in 2004, with beneficiary countries expected to meet certain conditions with regards to good governance and respect for the rule of law to qualify.
In 2007, MCC and Lesotho signed the first US$362, 6 million (more than M3 billion) compact to reduce poverty and spur economic growth.
In 2015, the MCC stalled in renewing the compact programme over rampant human rights abuses perpetrated under former Prime Minister Pakalitha Mosisili’s regime.
Lesotho’s eligibility for the second compact was first confirmed by the MCC Board in December 2017 after the ouster of the Mosisili regime in the June 2017 elections and the advent of the Thomas Thabane-led coalition.
However, there have been increasing reports of police brutality against citizens and graft in government in recent times.
The government and the opposition have also been dragging their feet on the multi-sector reforms process. There has been very little progress towards the implementation of the reforms and this has seen the country miss the May 2019 Southern African Development Community (SADC) deadline for the full implementation of constitutional and security sector reforms.
Jason Small, the MCC’s Managing Director in the Department of Compact Operations (Africa Programmes) this week told the Lesotho Times that Lesotho and the MCC were “still a year away from a definitive agreement” on the size of the second compact which was most likely to be in the region of the first compact (which was US$362, 6 million).
Mr Small however, warned that the failure to address concerns about human rights violations including the alleged acts of police brutality against citizens as well as the lack of political will to implement the reforms could scupper the granting of the second compact.
“It’s important to remember that the MCC board of directors reselected Lesotho as eligible to develop the second compact in December 2017 because of the concrete steps that have been taken to demonstrate the country’s commitment to addressing MCC’s ongoing concerns about the rule of law,” Mr Small told the Lesotho Times in an exclusive interview in Maseru this week.
“Since the MCC board reselected Lesotho, we have been working closely with Lesotho Millennium Development Agency (LMDA) to develop a second compact. Our desire is to fund a compact that will unlock the economic growth potential of this country.
“We are about a year or so away from completing the design of the compact and this is an important phase where we begin to make decisions about where the investments will be, what sectors we will focus on and what reforms will be required to make the compact a success and sustainable.”
He said while progress had been made towards the second compact, everything could be undone if the country failed to address concerns about human rights violations.
“The MCC board of directors maintains its expectations that Lesotho should demonstrate a clear commitment to MCC eligible criteria.
“Key among the eligibility criteria is a clear demonstration for the respect of the rule of law and the MCC is closely monitoring developments related to this and other eligibility criteria including the national reforms process.
“Let me take you back to December 2015 when the board made a decision not to reselect Lesotho for the second compact due to the (previous government’s) failure to meet the eligibility criteria. We had two years where we did not work on the compact that is two years that we lost in investment
“We will be very sad to have a situation like that happening again,” Ms Small said, adding, an MCC team would visit the country later in the year to assess how far the country had gone in addressing concerns that had been raised in terms of the eligibility criteria.
His sentiments were echoed by the US ambassador Rebecca Gonzales who said that, “with respect to the second MCC compact, our messages have been clear and consistent that Lesotho must continue purposefully on the path of reforms and political stability to avoid disruption or delay in this process”.
“An MCC compact represents a very significant investment in Lesotho on behalf of the United States people and the United States tax payers therefore it is essential for us to be working with a partner that is equally committed to the process oversight and accountability required to make that investment the most impeccable.”
In February, Ms Gonzales also warned of a “delay or derailment (of the second compact) if we do not continue purposefully on the path of reforms and political stability”.
“There is still potential for delay or derailment if we do not continue purposefully on the path of reforms and political stability. If we stray from that path, it will be even more difficult to find our way again.
“I am deeply concerned about alarming reports of corruption and police brutality — behaviour that is unacceptable and non-negotiable. The consequences of an interrupted compact development will not be as serious as the negative impact to the people of Lesotho caused by failure to address these critical issues,” she added.
Both Mr Small and Ms Gonzales said they however, remained hopeful that the obstacles to the second compact would be cleared.