Stakeholders meet over water project

Ntsebeng Motsoeli

The Minister of Trade and Industry, Cooperatives and Marketing, Sekh’ulumi Ntsoaole says the country’s “sluggish” economy would make it difficult for investors to plan for Phase Two of the Lesotho Highlands Water Project (LHWP2).

The LHWP2 is part of a multi phase initiative established through a treaty signed by the Lesotho and South African governments in 1986.
South Africa seeks to augment its water-supply through the project, while Lesotho expects to benefit from infrastructure such as roads, as well as royalties and electricity, from the initiative.

Phase One of the project, consisting of the construction of Katse and Mohale dams Muela hydropower-station and associated tunnels, was inaugurated in 2004.
The LHWP2, on the other hand, includes the construction of Polihali dam in Mokhotlong, extension of the Muela hydropower station, the building of a 38.2 kilometre water-transfer tunnel connecting Polihali with Muela, as well as roads to the project sites, camps, power transmission lines and administration centres.
The construction of the dam, which is the major component of the project, is expected to begin in 2017 and completed in 2023.
However, according to Mr Ntsoaole, investors would find it hard to plan for the project due to the unstable economy.

Mr Ntsoaole was speaking at a breakfast meeting organised by the Lesotho National Development Corporation (LNDC) on Monday this week, where the Lesotho Highlands Development Authority, which is the implementing authority of the LHWP, banks and other stakeholders unpacked investment and funding opportunities for the local private sector in the multibillion-maloti project.
“We are all aware of the sluggish performance of the regional and global economy. The exchange rate of our local currency is yet to be stable, which makes it difficult to plan properly, especially for those who will have to procure machinery from abroad,” Mr Ntsoaole said.

The minister said other equally challenging obstacles to the development of the country’s private sector include proper physical infrastructure.
“Efficient road, rail and air transport links are necessary in order to reduce high transaction costs both within Lesotho, where goods have to be transported from the industrial estates to ports, and also among Lesotho’s trading partners,” he said.
Mr Ntsoaole urged the LNDC, whose role is to promote Lesotho as an attractive investment location for both foreign and indigenous investors on behalf of the government, to ensure these challenges are addressed.
“I expect the LNDC, in coming days and months, to rollout a series of strategic interventions to overcome some of these problems.”

Mr Ntsoaole, however, urged local businesses to take advantage of the LHWP2 investment-opportunities, adding despite these challenges, Lesotho still had the potential to improve its economy.
“In my travels, I have seen places that are not even half as blessed with natural resources like Lesotho, prospering. Lesotho has the potential to graduate from its current Least Developed Country status within a decade, if only we can start thinking outside the box or at best, get out of the box completely.

“Some of the opportunities that we have identified are exactly just that. We need to take a bit more risk and stop the habit of playing within our circle of confidence.
“I am therefore, urging the gathering here today to take note and act. We are inviting you to join us in our quest to rid Lesotho of unemployment and poverty.
“While I pledge support on behalf of the government, you, as the private sector, are also invited to participate with your wealth of experience and skills to ensure that opportunities translate to fruitful and sustainable economic activity,” Mr Ntsoaole said.

On his part, the LHWP Coordinator-Manager, Tente Tente, said business opportunities in the design stage of the project would include consultancy services, training, technology transfer, office and accommodation rentals, as well as the supply of goods and services. Mr Tente further said opportunities in the construction phase would, among others, be for contractors and sub-contractors, skilled and unskilled labour, and the supply of goods such as building material, machinery, and fuel, as well as the provision of hospitality, banking, catering and transport services.
Retail and sports facilities, barber and fitness centres would be some of the services needed at the construction site, he added.

“There are massive and small business opportunities available in the project. People can make full use of the chances for as long as their goods and services meet the require standards, and supplies are of good quality and consistent.”

Mr Tente further said more opportunities such as aquaculture and tourism would still be there post-construction.
The Bankers Association of Lesotho (BAL) chairperson and Chief Executive Officer (CEO) of Standard Lesotho Bank, Mr Mpho Vumbukani, in his address, said financial institutions were prepared to provide funding to businesses to help them meet their objectives pertaining to the LHWP2.

“We would want to make Phase II successful by supporting business. We are ready to provide funding and advise to make sure that companies run successful projects,” Mr Vumbukani said.
The Minister of Energy, Meteorology and Water Affairs, Tšeliso Mokhosi, assured local entrepreneurs that government would ensure their businesses are given priority in the procurement of goods and services for the project.

“The project will present a climate of opportunities for the business sector, and the government will make sure that Basotho participate in the construction of the infrastructure,” Mr Mokhosi said.

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