By Kefiloe Kajane
There are mixed reactions to finance minister Thabo Sophonea’s 2021/2022 budget, after stated that government is conducting group sessions locally and in South Africa for retrenched workers and their beneficiaries in order to manage their savings and create self-employment.
The chief executive officer of the Private Sector Foundation of Lesotho Thabo Qhesi says the budget tried to address key sectors but it was not enough. He said that there is still a room for improvement as there’s still more that could have been done in some sectors
Qhesi said they appreciate and understand that there are limited financial resources. Lesotho, by virtue of being National Determined Contributions (NDC) country, still has opportunities to get more assistance by virtue of that status.
“For example, the United States has given us the opportunity for garments from Lesotho not to pay duty, so that status of being an NDC is giving us opportunities that we do not see being utilized. Because, for example AGOA has more than 600 lines of products but we do not utilize even more than 10 of the products that go to the US.
“Another concern with the budget speech is that we do not see the money that goes to the infrastructure as enough, because if want to create employment, we should see factories in every district, there should be industrial infrastructure that is being planned where trade is practiced.
“There should be incentives that encourage business to be done in other districts, not only in Maseru, to avoid the congestion because people believe that opportunities are only available in Maseru. It is not clear how employment is going to be created because the private sector, it has been in a perilous state because the government takes forever to pay them that is why some of the businesses have collapsed,” he said
For her part, business expert Likeleli Monyamane indicated that the budget mentions a number of initiatives that are aimed at creating jobs in the economy, but is not specific about the number of jobs that are targeted to be created and therefore it is unclear what the impact of the planned initiatives will be on the current unemployment rate in the country.
Monyamane, also said Lesotho has a high number of unemployed graduates and the question is: will the types of jobs created in manufacturing and agricultural sector be in alignment with the skills of these youth? How will the government drive graduates to work in those sectors?
“The budget was silent on the impact of Covid-19 on job losses in the country – how many jobs were lost, what support is the government providing to mitigate this loss, how will those jobs be restored? This means we are uncertain of what their efforts will yield even in that regard.
“M700 million has been allocated to the Youth Apprenticeship Programme, which is a significant amount of money. One of the ways in which this programme can create sustainable jobs (beyond the six-month duration of the programme) is if the government engaged the Lesotho private sector more robustly to participate in the programme.
“This is something we hope to see the government do so they we can achieve a higher absorption rate of interns into the workforce than the reported rate of vie percent. The 164,000 targeted youths are a good target, and we look forward to seeing the implementation thereof,” Monyamane said.
In the budget, Sophonea described MSMEs are the backbone of the economy, but access to finance, markets and in some quarters appropriate technology remain as big constraints to growth.
“We are working on a strategy for incubation in selected sectors so that they can also participate in international markets effectively.
“The uptake of matching grants and credit guarantee facilities are being supported by enhancing BEDCO business strategy to offer the required business support services.”