IMF Staff Concludes Visit to the Kingdom of Lesotho

MASERU, Lesotho, November 26, 2014/African Press Organization (APO)/ -- A technical team from the International Monetary Fund (IMF) led by Ms. Natalia Koliadina visited the Kingdom of Lesotho from November 17‒26, 2014. The team assisted the authorities with updating the near-term economic outlook and projections for the medium term.

At the end of the staff visit, Ms. Koliadina issued the following statement:

“Lesotho's economic growth has slowed, partly because of the current political and security situation. Real gross domestic product is expected to grow by just over 2 percent in 2014/15, against 3½ percent a year ago. Construction in particular has been affected by delays in new investment—notably slow implementation of government projects. International reserves, however, have remained strong, mainly due to high government revenues 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. Investing in physical and human capital, while sustaining ample international reserves would help address these challenges. This would require containing recurrent expenditure in the Fiscal Year 2015/16 budget, particularly on wages and salaries, and allocating sufficient resources for investment. In addition, strong budget planning and expenditure control is needed to increase the efficiency of public services. Following the upcoming elections, it will be important for government to address these challenges to ensure macroeconomic stability and inclusive growth.

“The team met with the Minister of Development Planning, Dr. Moeketsi Majoro, the Governor of the Central Bank of Lesotho, Dr. A.R. Matlanyane, the Acting Principal Secretary for the Ministry of Finance, Mr. Khosi Letsie, the Acting Principal Secretary for the Ministry of Local Government, Chieftainship and Parliamentary Affairs, Mr. Mikia Molapo, other senior government officials, representatives of the private sector, and development partners.

“The team would like to thank the authorities for the open and productive discussions. An IMF team is scheduled to return to Lesotho in mid-2015 for policy discussions in the context of the annual consultation mandated by the IMF's Articles of Agreement.”