Lesotho: Crisis Slows Lesotho’s Growth

01 December 2014

Lesotho’s political and security crisis this year has contributed to slowing economic growth substantially, according to an International Monetary Fund (IMF) report.

Natalia Koliadina, head of an IMF technical team which ended a visit to Maseru this week, said real growth in Lesotho’s gross domestic product was expected to be just over two percent in the current financial period, down from 3.5 percent a year ago.

“Construction in particular has been affected by delays in new investment — notably slow implementation of government projects,” Koliadina said. However, international reserves remained strong mainly because of Lesotho’s share of revenue from the Southern African Customs Union.

“Improving growth prospects and maintaining economic stability are the main challenges facing the government in preparing next year’s budget,” Koliadina added. “Investing in physical and human capital, while sustaining ample international reserves would help address these challenges.”

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