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By Bokang Moeko

Last week Tuesday, April 12, oil rose above $43 a barrel to its highest level so far in 2016, supported by hopes that a meeting, of April 17, of oil producers would agree steps to tackle a supply glut and by a weak US dollar and further signs of strong demand in China.

Remember, the jump in the cost of electricity, in South Africa, is to come into effect this month. This increase of oil and electricity is going to increase prices further. The prices are already expected to increase in May – and this does not come as a shock at all.

Let us carefully look at this, according to the latest FNB-BER study, in the first quarter, the South African consumer confidence index recovered from a 14-year low, but still remained in negative territory.

FNB chief economist SizweNxedlana said the slight recovery was helped by the end of power cuts and a fall in fuel prices between October 2015 and March 2016, among other things.

“Given that the heydays of easy access to unsecured credit, low interest rates and strong growth in public sector employment are now behind us, we expect the growth in real consumer spending to slow further during 2016,” Nxedlana said.

Let me clarify something here, consumer spending fuels GDP which is a measurement of the health of the country’s economy. If consumers spend less (the current increased cost of borrowing, stagnating and receding wages and increased prices makes this a fact) the economy stalls possibly leading to a longer-term recession.

Could this be the case for South Africa?  Repeat, could this be the case for Lesotho?

We have, literally, cut everything we don’t really need by now I assume.

But times are heartbreakingly tough. This really is a crocodile infested river and you cannot expect to come out unscathed. I now understand why the rate of suicide attempts accelerated at the start of April in many aboriginal communities in Canada. And why some life coaches are recommending people to stop watching the news and stop reading business columns. But how will we know what to do to minimise pain if we do all that?

Okay, by now, we have our door sized gardens, are wearing all clothes in our wardrobes, have lost some car dependency, and opted to driving cars that are mainstream.

While on that note, what do you think of the new Toyota Hilux and the new Ford Ranger? A farm girl in me knows Lesotho is a bakkie country. The top of the range Toyota Hilux 2.8 GD-6 4×4 AT Raider comes in at R547 900 compared to the top of the range Ford Ranger 3.2TDCI 4×4 AT Wildtrak at R597 900. This is worth mentioning because I know there are people, a few number I assume, that can afford these cars. And these are the very people we rely on to increase consumer spending now.

But my advice is, pay cash. The cost of borrowing is high now and might continue to increase. According to Reuters, South Africa’s retail sales grew above expectations in February, data from the statistics agency showed on Wednesday, April 13, suggesting the central bank might have scope to hike interest rates further at its next policy meeting.

So, you don’t want to find yourself in a tight situation whereby you have to pay way more than you bargained for and end up missing your payments.

But if you can have a high amount of debt but also have a high amount of income that allows you to easily afford the payments, then borrow. Your debt won’t drag down the economy, it will help it grow.

But for those who depend on a salary that is barely helping make ends meet by now, they should avoid borrowing at all costs and continue cutting down the expenses. Here is what to cut:

  • Parties — and night outs with your boys or girls. There is a little boy or girl inside of you who wants to live a bit. Allow him/her to. In the privacy of your own home, play your favourite song and dance like never before in your pyjamas– perfection is overrated, so for once you can be yourself.
  • Install a solar geyser and save up to 40% on your monthly electricity bill.
  • When everything becomes really hectic, you have an option of moving into a smaller apartment or move back home, if you are single,– there is no shame in that, the A listcelebrities in South Africa, Kelly Khumalo and DineoRanaka, have done it.
  • Should the clothes in your wardrobe befew, consider buying second-hand clothes — Britney Spears does it so it’s cool — or go through your mother’s wardrobes ladies — vintage clothes will always be elegant and fashionable.
  • Married couples, romance is not expensive. Make an effort of cooking your husband his favourite meal once or twice a week. “Honey, you look good”, is a million dollar compliment. Give him that million dollarevery day.

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Jobs galore for Lesotho

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94 000 jobs.

That is what the Millennium Challenge Account (MCA-Lesotho) will create in the next 10 years, according to Prime Minister Sam Matekane.

The MCA-Lesotho was created by the Lesotho parliament last year after the United States’ Millennium Challenge Corporation (MCC) found Lesotho eligible to receive development funds.

The MCC gives development grants to poor countries that respects democratic principles and human rights.

The MCC has unlocked a staggering US$322 million (over M5 billion) to the government of Lesotho after the country enacted three laws the protect people’s basic rights this week.

Matekane advised youths to visit MCA-Lesotho offices to understand how best they can benefit from the fund and the projects that will be financed.

The MCC’s investments are aimed at increasing the availability of water for household and industrial use, enhance watershed management and conservation methods, rehabilitate health infrastructure and strengthen health systems, and remove barriers to private investment.

The MCA-Lesotho’s Health and Horticulture Compact seeks to assist the country in unlocking equitable and sustainable economic growth in partnership with the private sector by addressing key constraints to growth.

Matekane said the job creation potential of the horticulture project alone is estimated at 4 000 jobs.

This excludes indirect jobs that will be created through packaging supplies, logistics, cold chain activities as well as the processing of the output.

“Let us all be ready and ensure we spend all the funding that is available,” Matekane said.

He said the money is going to be invested in agriculture, trade and industry, value chains, infrastructure development, tourism and creative sectors.

“The Compact has come at a critical time when the country is in dire need of financial injections to revive the economy,” he said.

“This second Compact forms the core of Lesotho’s private sector-led economic growth, recovery and job creation agenda.”

He said the MCA staff should work diligently, to implement this Compact.

“There are several Basotho businesses out there that are eager to seize the opportunities that the Compact brings,” Matekane said.

“Serve them with integrity, accountability and dedication.”

Matekane said the government has established the Cabinet Sub-Committee on the Compact which is under the leadership of Deputy Prime Minister Nthomeng Majara.

The sub-committee is mandated to ensure that the government provides overall oversight, strategic direction and support for successful implementation of the Compact.

He said he expects the MCA-Lesotho to ensure the full implementation of the project within the next five years.

“Our economy needs this capital injection to boost productivity and job creation,” Matekane said.

Matekane said the government had to enact three pieces of legislation which were necessary to support the investments that the MCC is making.

The enacted laws are the Labour Code Amendment Bill, the Administration of Estates and Inheritance Bill and the Occupational Safety and Health Bill.

Majara Molupe

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Bank spearheads career expo

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Standard Lesotho Bank will tomorrow host a career expo at the ’Manthabiseng Convention Centre for high school students who will sit for their final exams this year.
The 14th Annual Standard Lesotho Bank Career Expo was launched in Mokhotlong on Monday where the Lesotho Highlands Development Authority (LHDA) welcomed students in areas around the Polihali Dam construction site.

On Tuesday the expo was at the Butha-Buthe Community High School, yesterday it was at Assumption High School in Teya-Teyaneng while today it is in Quthing at Holy Trinity High School.

The five-day nationwide event is dedicated to connecting ambitious Basotho youths with exciting career opportunities.

Standard Lesotho Bank says it’s career expo “is a cornerstone of the bank’s commitment to empowering Basotho youth and shaping the future of Lesotho’s workforce”.

The 2024 edition of the event is the 14th where the bank is now the headline sponsor of this important expo that reaches about over 10 000 students countrywide.

The expo promises to be an even better offering where over 35 institutions of higher learning from Lesotho and South Africa as well as professional bodies will explain different career options to Basotho students.

Standard Lesotho Bank communications manager, Manyathela Kheleli, said students in Mokhotlong did not only learn about different engineering disciplines but got to appreciate engineering in action at Polihali.

He said it was a lifetime experience for students from Mokhotlong, “thanks to the collaboration with LHDA, who are fully responsible for the Polihali leg of the event”.

There were also motivational speakers from different professions in the bank and other selected institutions.

Key influencers in the football fraternity, former Likuena captain and now Corporate Responsibility Manager at Letšeng Diamonds, Tšepo Hlojeng, and former Orlando Pirates dribbling wizard, Steve Lekoelea, are among the influencers that have been invited to address the students.

The event is a sponsorship initiative under Personal and Private Banking that is open to all youths, communities, and individuals, where the bank intends to use this event to drive the new Youth or student Customer Value Proposition and attract high school students to open accounts ahead of their enrolment into tertiary institutions.

The objective of this sponsorship is to first create an environment where future leaders of Lesotho will be nurtured and informed of top career choices that demonstrate various skills requirements for the growth of Lesotho’s economy.

Secondly, the career expo is a clear demonstration of the bank’s intention to put youths at the centre of its initiatives.

This position is shown by the bank’s initiative to not only develop special products for youths, such as the Youth Account but also through several initiatives that promote youth empowerment. These include the bursary scheme and the Bacha Entrepreneurship Project.

“We are more than a bank for our youths, but a good corporate citizen and a partner for the education for Basotho,” Kheleli said.

“We believe that as we grow our youths, they will become assets to this country and by extension, develop into a feeder market for our banking products when they enter the job market,” he said.

The bank has invested M150 000 towards sponsorship of the annual Career Expo.

Staff Reporter

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Ministry launches fresh industrialisation drive

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A new policy to drive industrialisation in Lesotho was launched in Maseru this week.
The Lesotho National Industrialisation Policy 2024–2028 is being spearheaded by the Ministry of Trade.

The ministry says the policy seeks to accelerate economic diversification in the industrial base, enhance productivity and productive capacity for industrialisation and advance domestic and regional value chains for industrialisation.

It also seeks to promote and develop industrial clustering, promote inclusive industrialisation, support entrepreneurship development and strengthen business linkages.
The new policy will also seek to enhance energy efficiency and sustainability, promoting technology adoption and innovation, services-based industrialisation, and stimulating agro-based industrialisation.

This is not the first time Lesotho has launched an industrialisation policy. Previous policies have all failed.

The first attempt was the 2015–2017 industrial policy, whose aim was to accelerate the industrialisation agenda and address key challenges facing the country.

The second one was the 2018–2023 policy, which after its unsuccessful execution during the three years of implementation, the government extended it to the National Strategic Development Plan Strategic Focus (2023/24-2027/28).

The new industrial policy’s target is set to activate implementation on innovation to enhance the efficiency and competitiveness of domestic industries, create decent jobs and improve the welfare of Basotho.

Thabo Moleko, the Ministry of Trade Principal Secretary, said the implementation of the new policy is set to deepen economic growth, promote industrialisation and enhance competitiveness.

“The plan includes greater investment in industrial development with the intention to create employment and incomes while building on maintaining the existing industrial trade,” Moleko said.

Mamello Nchake, a consultant for the United Nations Economic Commission of Africa (UNECA), said the development goals of the industrial policy are set to ensure an achievable inclusiveness and equitable growth as they aim to create sector-led quality jobs for Basotho.

Nchake said the goals are meant to “develop and maintain enabled infrastructure that is critical to the private sectors and also to promote gender equality, environmental and climate risk management”.

“Moreover, the policy (will seek to) harness the collaboration with private sector firms to address common challenges and promote industrialisation,” she said.

The workshop discussed constraints that hindered the implementation of the 2018 – 2023 policy that undermined investment and trade opportunities.

The constraints include access to land for investment, inadequate provision of infrastructure, an outdated and a lack of appropriate regulatory environment, low productive capacity, market size and topological constraints, unstable macroeconomic environment, external factors, and over-dependency of trade preferences.

To address the strategic objectives, the previous industrial policies had proposed tax incentives for industrial development, trade policy and regional integration as the main vehicle for industrialisation and structural transformation.

They had also proposed mechanisms for policy coordination and implementation, institutional alignment and linkages.

However, several key challenges were identified in the implementation of the 2015-2017 industrial policy.

They included limited financial and investment capacity to effectively implement the industrial policy actions.

“Financing instruments are not aligned with the level of development needs of the private sector,” stakeholders heard at the workshop.

They also heard that there is “persistent dependency on few industries that poses risks in the face of global economic uncertainties and ever-changing consumer preferences”.
Another identified problem is limited investment climate that makes it costly for foreign firms to invest in Lesotho.

It was also observed that a shortage of specialised education and skills crucial for growth of industries impact the ability of firms to adopt advanced technologies and improve productivity and the productive capacity.

Stakeholders also heard that there is limited global competitiveness and access to global markets.

Lesotho’s industries, they heard, particularly textiles and garments, face competition from other low-cost manufacturing countries.

The country is also spooked by poor coordination between the implementing agencies due to a lack of a clear implementation framework.

Khahliso ’Molaoa

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