. . . AfDB’s latest report on Lesotho advises
Mohloai Mpesi
POLITICAL instability and the politicisation of security institutions have been identified as the major factors undermining investor confidence in Lesotho.
This is according to the Country Focus Report 2025, titled “Making Lesotho’s Capital Work Better for its Development”, released this week by the African Development Bank Group (AfDB).
The report outlines several challenges affecting Lesotho’s investment climate, chief among which is political instability, which hampers capital mobilisation and overall economic progress.
Lesotho has experienced recurring political instability since 2012 when the country saw the formation of its first coalition government comprising the All Basotho Convention (ABC), the Lesotho Congress for Democracy (LCD), and the Basotho National Party (BNP).
The height of this instability came in 2014 when then army commander Tlali Kamoli, now incarcerated, allegedly staged a failed coup against the coalition led by then-Prime Minister Thomas Thabane. Mr Thabane had fallen out with LCD leader Mothetjoa Metsing who was allegedly exerting control over the Lesotho Defence Force (LDF).
On 29 August 2014, Mr Thabane dismissed Kamoli and appointed Lieutenant General Maaparankoe Mahao as the new LDF commander.
That same night Mahao’s home in Koalabata was attacked by soldiers but he managed to escape, only to be killed on 25 June 2015 by soldiers who claimed he was resisting arrest.
He was accused of leading a mutiny against Kamoli who by then had been reinstated as commander by Thabane’s successor, Pakalitha Mosisili.
Mr Metsing and Kamoli are currently standing trial in the High Court for treason and the murder of Police Sub-Inspector Mokheseng Ramahloko, in relation to the 2014 attempted coup.
“Despite holding regular democratic elections since 1993, Lesotho has experienced political instability due to weak state and governance institutions, continuous splintering of coalition governments, and the politicisation of security establishments,” the report states.
While the current coalition of the Revolution For Prosperity (RFP), the Movement for Economic Change (MEC) and Alliance of Democrats (AD) seems stable since its formation in 2022, it also faced challenges on 16 October 2023 when Prime Minister Sam Matekane faced a motion of no confidence.
A conglomerate of opposition parties and some dissatisfied members of the ruling RFP wanted to unseat Mr Matekane on that day. However, their plan was thwarted when RFP’s Thaba Moea legislator, Lejone Puseletso, filed an urgent application in the Constitutional Court challenging the Ninth Amendment to the Constitution, which had essentially abolished a Prime Minister’s authority to dissolve parliament to circumvent a no-confidence vote.
The amendment granted Members of Parliament the power to replace a prime minister within parliament, depriving him of an opportunity to unilaterally dissolve parliament and call for snap elections.
The Court of Appeal upheld the nullification of this amendment in October 2024, solidifying Mr Matekane’s position.
The AfDB report also notes that lack of prosecutorial powers hinders key security institutions such as the Directorate on Corruption and Economic Offences (DCEO).
Worse still, there are no dedicated anti-corruption courts — factors which enable widespread and persistent corruption.
Lesotho’s ranking in the Corruption Perception Index (CPI) dropped from 39 in 2023 to 37 in 2024, indicating a worsening situation.
“Additionally, the Directorate on Corruption and Economic Offences lacks prosecutorial powers, and there are no anti-corruption courts, leading to persistent corruption issues, as evidenced by Lesotho’s low score on the CPI. These issues also pose a challenge in strengthening institutional quality and the effectiveness of key resource mobilisation bodies,” the report says.
It further notes that weak state capacity and poor institutional frameworks have contributed to significant resource leakages, limiting the country’s ability to mobilise and utilise capital effectively.
“Inadequate budgeting, weak budget controls, and low compliance, combined with under-resourced internal audit functions, lead to undetected errors and inefficiencies. High vacancy rates and low skill levels in these functions compound the problem,” the report states.
It also highlights lack of procurement regulations, guidelines, and a fully operational Public Procurement Authority, all of which result in inefficiencies and potential abuse in public procurement.
In order to strengthen governance and economic resilience, Lesotho must prioritise the fight against corruption and illicit financial flows, AfDB advises.
“Tackling corruption and illicit financial flows is essential for strengthening Lesotho’s governance and economic resilience, as well as improving the management and utilisation of the country’s capital. Empowering anti-corruption bodies like the DCEO with prosecutorial powers and establishing anti-corruption courts would enhance accountability and enforcement.”
It further recommends strengthening the legal and judicial systems, particularly in the extractive sector, to curb resource leakages and rebuild trust between the public and private sectors.
“Lesotho is also participating in international efforts to improve financial transparency and combat illicit financial flows, including through regional cooperation.
“Partnerships with cross-border institutions play a key role in strengthening Lesotho’s financial governance. The Southern African Development Community (SADC), through its Protocol on Finance and Investment and Anti-Corruption Committee, promotes cooperation on financial regulation, transparency, capital movement, and the fight against corruption and illicit financial flows.
“Similarly, the African Peer Review Mechanism and the African Tax Administration Forum of the African Union assess governance and economic policies to prevent capital leakages and facilitate cooperation on tax transparency and fair taxation.
“By addressing these governance issues, Lesotho can create a more conducive environment for capital mobilisation and utilisation, ultimately driving sustainable economic growth and development.”
