PREPARATIONS are underway for the review of the Lesotho Highlands Water Project (LHWP) treaty signed between Lesotho and South Africa in the 1980s to ensure Basotho achieve maximum possible benefits from the multi-billion maloti project, Minister of Finance Thabo Sophonea has said.
Mr Sophonea said this in his 2021/22 budget speech last week. He emphasized the review was meant to improve the project’s benefits for Basotho.
While the first phase of the multi-billion maloti project has significantly improved Lesotho’s economic prospects, the project has however, been criticised for failing to reduce poverty among citizens affected by its existence.
However, Mr Sophonea said the Ministry of Water was preparing for the review to change the situation.
“The government, through the Ministry of Water, has started the preparations to review the LHWP treaty,” Mr Sophonea said.
“In this long-awaited assignment, the Ministry of Water shall make thorough consultations and engage all stakeholders for the success of the special assignment that is intended to benefit the Basotho nation.”
Mr Sophonea said the on-going construction of the second phase of the project (LHWP II) had created more than 1200 job opportunities, of which 950 (80 percent) had gone to Basotho.
“It is expected that expenditure under the LHWP II activities will be in the region of M4 billion in the fiscal year 2021/22. The tender for the construction of the main works, water transfer works (dam and tunnel) and for the consultancy services for the design and construction supervision of the hydropower component will be advertised in the first and second quarter of the 2021/22 fiscal year.”
Work on the main water transfer component is expected to create more than 3000 job opportunities, thereby contributing towards unemployment and poverty reduction.
“As in Phase I, it is expected that the second phase of the LHWP will be one of the key economic stimuli in the country. It will, among others, create business and tourism opportunities, enhance skills development, and contribute to the government revenues.”
The World Bank, whose loan financed the first phase of the water project has in the past criticised its social impact failure.
In its 2010 project performance assessment report, the World Bank said the project’s most fundamental goal of alleviating poverty, which resonates with the bank’s own goals, was not achieved under the first phase.
“LHWP- Phase I B’s successful water infrastructure programme will be a pillar in Lesotho’s development programme for decades to come. But the royalties did not go to poverty reduction, the project’s most fundamental objective.
“Also, while LHWP- Phase 1 B was strong in all aspects related directly to construction (engineering, physical works and water delivery), it performed weakly in software aspects (capacity building, training and resettlement).”
The project was also criticised for its environmental impact by the International Rivers Network (IRN), an international organisation which protects rivers and defends the rights of communities that depend on rivers.
IRN opposes destructive dams and encourages a development model that encourages better ways of meeting people’s needs for water, energy and protection from damaging floods.
IRN said many Lesotho residents directly affected by the construction of the project were worse off now than before. It had taken years to organise compensation for the loss of homes and land.
“The LHWP has caused the vulnerable highlands population to lose fields, grazing lands and access to fresh water sources. Their livelihoods have not been restored, and poor people have been pushed closer to the edge in their struggle for survival.
“More than 20 000 people were affected by Katse Dam, losing their homes, farmland or the use of communal grazing lands. Another 7400 were affected by Mohale Dam,” IRN said.
“For those who lost houses, replacement housing took years to complete, while problems of erosion and the downstream effects of massive water diversions are disrupting ecosystems and people’s livelihoods.
“Although one of the project’s four key goals was to ‘maximise the poverty reducing impact of LHWP,’ Lesotho has actually gotten poorer since the project began.”
The LHWP comprises water transfer and hydropower generation components with associated ancillary developments.
The water transfer component entails the construction of dams and tunnels in Lesotho to facilitate the flow of water to South Africa while exploiting the delivery system to generate hydro-electric power in Lesotho.
The major works of Phase I included the construction of the Katse Dam, the transfer and delivery tunnels, ‘Muela Hydropower Plant and the Mohale Dam. The Phase II water transfer component comprises a dam at Polihali and a gravity tunnel that will connect the reservoir at Polihali with the Katse reservoir.