Lesotho’s economic growth is projected to slow to 0.8 percent in 2027, widening the gap between the country’s economic performance and the sub-Saharan African average, according to the International Monetary Fund (IMF).
The IMF’s October 2026 World Economic Outlook projections show that Lesotho’s real gross domestic product (GDP) growth was expected to decline from 1.5 percent in 2025 to 1.1 percent in 2026, before falling further to 0.8 percent next year.
The projected 2027 growth rate is 3.7 percentage points below the 4.5 percent forecast for sub-Saharan Africa, highlighting the comparatively weak growth outlook for the Mountain Kingdom.
Although the projections indicate that the economy will continue to expand, the slowdown raises questions about its capacity to generate jobs, increase household incomes and reduce poverty.
The IMF has previously warned that Lesotho’s economic outlook faces risks linked to uncertainty surrounding exports, disruptions to foreign assistance and the anticipated winding down of major activities under the Lesotho Highlands Water Project Phase II.
In its 2025 assessment of Lesotho, the Fund also highlighted the need for structural reforms to encourage private-sector investment and job creation.
The latest projections come as Lesotho faces the challenge of translating economic activity into broader improvements in living standards. Slow growth does not automatically mean employment will decline, but it can limit the pace at which new economic opportunities are created.
The projections underscore the importance of understanding which sectors will drive growth in Lesotho and whether that growth will translate into employment and improved livelihoods.
