DELAYED approval of financing plans for the supply of water and power services could delay opening of the Ha-Belo industrial estate in Butha-Buthe.
This was revealed by the principal engineer Delayneh Girma during a recent tour of the construction site at the construction site. Mr Girma said they do not have substantial financing plans for the supply of the two utilities upon completion of the construction.
The infrastructure project is expected to be completed by next January.
The tour was organised by the Lesotho National Development Corporation (LNDC).
The high-level tour was attended by among others Finance Minister Moeketsi Majoro, Trade and Industry Minister Halebonoe Setšabi, Minister of Social Development Motlohi Maliehe, LNDC board, LNDC chief executive officer Mohato Seleke and other government officials.
The construction of the 16 factory shells commenced in January 2018, with Unik Construction Engineering the main contractor of the M1 billion project.
The facility is expected to employ over 14 500 people while the construction phase has employed about 400 people.
There are currently 49 sub-contractors and 43 suppliers on the construction project, which is about 55 percent complete.
Among prospective tenants, the site will cater for the textile industry, agri-business and other sectors.
Mr Girma said there was an initial plan for a water supply system for the site was scrapped in favour of a smaller capacity plan. He said the alternative was unlikely to be ready in time for opening of the estate.
“Without water supply, operation of the factories will be impossible,” Mr Girma said.
“We therefore would like you (government) to assist us with the financial resources to develop the water supply system for the project.”
He added that power supply was equally important for the operation of the industrial estate. He said without an alternative plan, the existing power supply network in the area would not be adequate for the estate.
The estate has an estimated requirement of 7.5 megavolt amps (MVA) when fully operational. About four mega litres of water daily will be needed to serve the estate and support services around the area.
For his part, Mr Seleke said the LNDC was yet to receive funds for the project from the government. He said this had strained the corporation’s finances as Ha-Belo project was one of several other engagements that they are working on.
He said they were also overseeing a M450 million infrastructure project at the Tikoe industrial site in Maseru.
“We are M264 million in the red, meaning these are the funds that the LNDC has put together to make sure that this project happens while waiting upon the government to avail the funds. This has left us with nothing.”
He said the LNDC has no other choice as it has a huge responsibility of generating jobs which is hampered by shortage of factory shells for prospective investors.
Mr Seleke said they were under pressure to avail shells through the Ha-Belo estate while feasibility studies are ongoing for another project in Mafeteng and another in Berea.
“The demand for factory shells is simply more than what we can currently supply. So, I humbly ask the relevant government authorities especially the Finance Minister to intervene.”
For his part Dr Majoro said it was important for the project to be completed on schedule as job creation depended on it.
He said the funds had already been raised through government bonds and the government would ensure a speedy disbursement of the funds to the LNDC.
“It is important that the funds are handed to the LNDC so that the project is not delayed. The budget controller will see to it that the LNDC gets its money as I understand the money is available,” Majoro said.
On the power and water issues, Dr Majoro said there were alternative plans which could be considered.
“There is a new water project worth M1, 5 billion originating from the scrapped five towns water project. This project is now at an advanced stage with its feasibility studies completed, we are left with prospective financiers to approve our US$110 million loan finance in the coming months.
“Construction is expected to commence towards end to this year, and that means water supply will not be ready in time for commencement of operations of the factories here.”
Toloko Ramaema, from the Water and Sewerage Company (WASCO), said they were working on a plan for a package plant to avail water to the industrial estate.
Lebohang Mohau from the LNDC said there were two options to be considered in addressing the power issue.
“There is a plan to run a powerline from the existing pylon structures from Khukhune sub-station to Ha-Belo and then we install a substation here.
“Over and above that we were able to motivate the financier which is the World Bank for connection of additional consumers around the Ha-Belo area. So, it looks like the spin offs will be able to be realised by the community of Ha-Belo as well.
“Discussions on the two plans are at an advance stage, with final presentation to be advanced to the Ministry of development planning for approval.”
He said other needs for the site up for discussion would include security, firefighting and health services.