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Harvard economist seeks to revive Lesotho’s economy

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MASERU – A renowned Harvard economist arrives in Maseru today for an initial two-day assessment of how his team can help the new government revive the ailing economy.

Dr Ricardo Hausmann, who is the founder and Director of Harvard’s Growth Lab, will be accompanied by Professor Rafik Hariri of the Harvard Kennedy School and his colleague, Kishan Shah.

During the two-day visit, Hausmann’s team will meet Prime Minister Sam Matekane who is desperate to quickly turn around the country’s economic fortunes.

He will meet the Cabinet for a presentation on his Economic Complexity Index which is used to predict and explain future economic growth.

The index assesses the industrial structure of an economy with a focus on prescribing a growth path into prosperity through high-value-added industrialisation.

There will also be meetings with the Ministry of Finance, the Ministry of Trade and Industry and the Central Bank governor.

Also lined up are meetings with businesses, textiles, banking and mining representatives.

The visit is likely to be a precursor to a collaboration meant to help the Matekane-led government craft sustainable and inclusive economic growth strategies.

“Since this is my first trip to Lesotho, I look forward to discussing the government’s challenges, goals and plans. I might explain how we think about growth, my first impressions or questions about Lesotho and how we typically work in other countries,” said Hausmann.

Founded in 2006, Harvard’s Growth Lab is regarded as one of the top influential hubs on international development. As the lab’s director, Hausmann has served as the principal investigator for more than 50 research initiatives in nearly 30 countries.

Most of the research has informed development policy, growth strategies and diversification agendas at national and sub-national levels.

Before joining Harvard University, Hausmann served as Venezuela’s Minister of Planning and board member of that country’s central bank in the early nineties. He was also the chief economist of the Inter-American Development Bank and served as chairman of the IMF-World Bank Development committee.

Hausmann’s visit comes when the economy is in dire straits with growth having ground to a halt and the textile industry haemorraging jobs.

The government coffers are empty due to a slump in domestic and regional revenue receipts. The economy, which according to the IMF, shrunk by 10 percent in the last year, is yet to recover from the ravages of the Covid-19 pandemic.

As part of his 100-day plan, Matekane prioritised supporting the post-pandemic economic recovery, fiscal consolidation and structural reforms to restore external balances, maintain debt sustainability and stimulate inclusive growth.

Staff Reporter

 

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Trade Minister rejects textile unions’ charge

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MASERU – Trade and Labour Minister, Mokhethi Shelile, says a statement that Lesotho’s textile workers were earning enough is a gross misrepresentation of what he said during a radio interview last month.

Shelile, who has come under fire from trade unions over the issue, said he was quoted out of context.

He told thepost last night that “it is a lie that I said textile workers are earning a lot of money”.

“Someone is deliberately misinterpreting my statements during the interview with MoAfrika FM,” Shelile said.

“Even the presenter who was interviewing me, (Morao) Hlephe, says he is shocked by how these people have twisted my words,” he said.

“Some people are blinded by their political masters to an extent that they start blatant lies to score cheap political gains,” he said.

“This is petty.”

Shelile was responding to allegations made by the Independent Democratic Unions of Lesotho (IDUL) secretary general, May Rathakane, at a press conference earlier yesterday.

Rathakane told the press conference that the unions had lost all hope that the government will improve the lives of textile workers.

“The minister’s speech about workers, especially textile workers, in Lesotho earning (a big) salaries as compared to other countries like Singapore is irrelevant,” he said.

“As workers’ unions, the minister’s speech gave us an impression that Lesotho’s government aims not to increase salaries for textile workers.”

Rathakane alleged that the Sam Matekane-led government did not intend to increase textile workers’ salaries.

He said Matekane had promised during election campaigns for last October’s general election to significantly increase workers’ salaries to M4 000 a month, up from the current M2 200.

“We want to make the minister aware that the salaries earned by textile workers is insufficient as compared to workers in other countries,” Rathakane said.

“From that salary they deduct transportation costs and rent and other expenses that include medication and doctor fees if one sustains injuries while at work,” he said.

“In those countries transport, rent, medical aid and food are taken care of by the government.”

“This simply shows that the salary earned is too little and that is why they vouch for M4 000 which was promised to them,” said Rathakane.

A textile worker in Lesotho earns an average of M2 200 per month.

Rathakane said they are disappointed by the government as it has not stated how it is going to keep the already existing jobs safe and how they are going to create more jobs.

He said the IDUL is worried after Finance Minister Dr Retšelisitsoe Matlanyane recently claimed that the government is broke.

“We are troubled to hear about all the problems the government is facing financially and we are worried that at this rate our issues may not be solved as all we hear are problems without solutions,” Rathakane said.

He said they had a meeting with Prime Minister Matekane and Shelile towards the end of last year where they spoke about the challenges workers were facing.

He said they told Matekane that he should capacitate the Directorate of Dispute Prevention and Resolution (DDPR), Labour Court and Labour Appeal Court because they lack resources and judges.

The IDUL said it told the government that workers are receiving unpleasant services from those courts mainly because the courts were grossly under-funded.

The workers’ unions said while they appreciated what the government had done after coming into office, they are “disappointed to hear that the people who stole government money have still not repaid it”.

“This makes us wonder if we will even get the M4 000 monthly salaries as promised.”

Shelile said his views had been “misinterpreted” for propaganda purposes by his political opponents.

He said his argument was that under the United States’ Africa Growth Opportunities Act (AGOA) Lesotho has a chance to produce a wide range of things for export and “sticking to only one product will not work for us”.

He said he likened this to a vendor selling a maize cob for M15 and yet he bought it for M16 and then expect a salary increment from the sales.

“I was merely saying we should diversify our products if we want to earn more, saying presently we are producing what cannot pay us more.”

Shelile said the RFP government is committed to the improvement of workers’ conditions of service but at the same time improving the business environment.

Tholoana Lesenya

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World Bank pledges M2.1 billion to Lesotho

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MASERU – THE World Bank has pledged US$120 million (about M2.1 billion) for new projects in Lesotho for the coming year.

This revelation was made by the Minister of Foreign Affairs Lejone Mpotjoane at a press conference in Maseru yesterday.

Mpotjoane said the World Bank will visit Lesotho in January to look into the issues of project management, public financial management, government accountability, contracts management and procurement management.

“The World Bank raised a concern that the implementation of the projects is slow and in most cases behind schedule,” Mpotjoane said.

This came after Lesotho’s delegation led by Prime Minister Sam Matekane attended the US-Africa leaders’ summit in Washington in the United States last week.

Mpotjoane said the Summit was held to discuss how heads of government, officials, business leaders, and civil society could strengthen ties between the US and
Africa.

“One of the important issues discussed at the summit included good governance, democracy, human rights and rule of law,” he said.

The summit also discussed mitigating the impact of Covid-19 and future pandemics and strengthening regional and global health, promoting food security, advancing peace and security, responding to the climate crisis and amplifying diasporaties.

Mpotjoane said the United States also pledged at least US$55 billion (about M935 billion) to Africa over the next three years, spanning across a range of diverse sectors.

“The US further pledged to lend up to US$21 million (about M493 million) through the International Monetary Fund (IMF) for low and middle-income African countries,” Mpotjoane said.

He said the US Trade Representative signed a Memorandum of Understanding (MoU) with the African Continental Free Trade Area (AfCFTA) Secretariat to support institutions to accelerate sustainable economic growth across Africa.

He said Matekane also met the Chief Executive Officer of the American Peace Corps, Thomas Peng.

He said the US had suspended its Peace Corps operations in Lesotho due to the Covid-19 pandemic.

And after the meeting, the Peace Corps has undertaken to send over 50 volunteers to Lesotho.

Mpotjoane said Matekane also met the World Bank Group Vice-President, Victoral Kwakwa.

He said during the meeting, Matekane and his delegation stressed the commitment of Lesotho to work with both the World Bank and IMF institutions as key bilateral and multilateral partners to get Lesotho on a sustainable broad-based and inclusive growth path.

He said Matekane also met the Chair of the Senate Finance Committee, Senator Ron Wyden.

He said Matekane met the Chair of the Africa Sub-Committee, Senator Van Hollen, who was impressed to consider an extension of the Africa Growth Opportunity Act (AGOA) beyond 2025.

“The extension of AGOA will secure and create thousands of jobs in the manufacturing sector,” Mpotjoane said.

Matekane last Saturday tweeted that the secretary general of AFCFTA fully supports and wants to be part of developmental activity for Africa.

“Lesotho delegation led by myself met with his team and discussed assistance of AFCFTA in some of Lesotho government’s development activity,” Matekane said.

Nkheli Liphoto

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Early Christmas for MMB clients

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MASERU – CHRISTMAS came early for two of Maluti Mountain Brewery (MMB)’s clients after they walked away with Nissan NP200 vehicles for promoting excellence in sales in their businesses.

The prize-giving ceremony was held in Maseru on Tuesday.

The MMB further distributed M1.5 million to its clients this year in a bid to increase its sales.

The winners of the two Nissan NP200 cars are Katleho Khuto, a tavern owner from Mohale’s Hoek, and Libe Mapane, an owner of an off-sales, who won in the gold category.

The silver category winner is ’Nokoane Rankhasa who runs an off-sales while in the bronze category the winner is Letšoala Letšoala, also running an off-sales.

Khuto said this was the first time he had participated in the competition.

He said he had been working hard to perform well in business.

“I am not only selling to clients in the tavern but I also deliver the stock to my clients,” he said.

He said this kind of business has the potential to grow.

“It just requires good capital and good customer service,” he said.

Khuto said the prize money will help him to stock his tavern.

“I have been hiring people’s cars. Therefore, this will help to minimize my costs,” he said.

The MMB Sales Manager, Pusetso Thoala, said this programme started last year.

He said due to the Covid-19 pandemic many businesses collapsed and they want to help them recover.

Thoala said due to Covid, they saw it befitting to include all kinds of businesses in this sector.

Then they decided to include taverns and shebeens in the competition since they take a bigger fraction in the industry.

Thoala said the competition seeks to motivate businesses in this sector to work hard.

He said if businesses work hard, this will increase more sales hence improving MMB operations.

“We are seeking to reach even the districts,” he said.

Last year MMB put aside M2.4 million for this competition with 800 business owners participating in the programme.

A staggering M793 000 was awarded to customers who exceeded targets.

“We are offering two cars this year,” he said.

Thoala said this year they will focus on helping a higher number of business owners with renovation projects.

Thoala said they have three categories being gold, silver and bronze where in the category of gold, they will be offering a Nissan MP200 car model.

MMB believes this will motivate business owners to increase their sales.

Thoala said this is not only benefiting MMB but also business owners due to increased profits.

A Mohale’s Hoek businessman who did not want to be mentioned said the competition was fair.

He said this kind of celebration should not only be about collecting the prizes but it should be used for networking between stakeholders as well.

He said he was expecting the business owners to be given a slot to discuss their challenges and strengths so that the sector could grow.

Refiloe Mpobole

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