Ultimate magazine theme for WordPress.

Hard times coming

THOSE that put all their eggs in one basket must not cry when they lose them all at once.
But if Finance Minister Timothy Thahane’s statement in parliament last Thursday is anything to go by then we will rue the day we missed this crucial lesson.
As Thahane said, the economic crisis that has been buffeting the world’s economies, especially the rich ones, had reached our shores and has already started gnawing at our fragile economy.
Judging by the trail of damage the crisis has left in other countries, Basotho must brace for very tough times ahead.
How we respond as a nation will determine what the crisis will leave of the economic gains we have made since independence in 1966.
Thahane’s statement should have a chilling effect on anyone who understands its implications on us as a people.
Yet for those who don’t understand it, the message is simply that many people will lose their jobs as companies close and many will have less to eat because they won’t have money.
His statement can be reduced to two words: jobs and food.
When Thahane says Lesotho’s share of the South African Customs Union (Sacu) revenue will slump by 65 percent in the next three years he means we will be almost broke as a nation.
A broke nation can’t feed itself.
The reason for this predicament is that Lesotho gets 60 percent of its annual budget from Sacu revenues.
So when he told parliament that “mammoth challenges lie ahead” he sure wasn’t being overly pessimistic.
He wasn’t being alarmist when he told the MPs that “dark clouds hang perilously over our future as a nation”.
Thahane said the crisis had already started biting and was likely to sink its teeth deeper into Lesotho’s economic wellbeing in the next three years.
He said about 1 235 Basotho had already lost their jobs in the manufacturing sector, while 650 Basotho were also retrenched from South African mines as a result of the global financial and economic crisis by the end of June.
More than 42 000 jobs in the textile industry, Lesotho’s biggest employer, are on the line.
Also companies in the diamond mining industry have had to shed jobs because diamond prices on the international market took a battering.
We have no doubt there are many companies in Lesotho that are tottering on the brink of collapse.
It is not far-fetched speculation that as the government gets deeper into the financial squeeze it too might be forced to cut jobs.
But why do we find ourselves in this precarious position in the first place?
There is comfort in blaming the obvious — those Western countries that created this crisis by allowing banks to lend recklessly.
Comforting too is the excuse that we are a small fish that has been washed ashore by a very big storm.
There are those who might take solace in the numbers, saying after all everyone has been stung by the crisis.
But if the truth be told, none of those comforts will make the recession’s impact lighter on us.
The International Monetary Fund says poor countries especially those in Africa will be ravaged by the crisis.
The impact will be more painful for Lesotho because it has literally put its eggs in one basket.
We are victims of our failure to diversify our economy so when the textile industry starts faltering not only are we hit hard but we are left with no fallback.
Lesotho does not have Plan B for the economy.
Imagine the catastrophe that will happen if the 40 000 jobs in the textile industry are lost.
Lesotho must push to develop other industries.
We must seek to make other things that others can buy other than clothes.
But if you look at it closely you will notice that the real reason why we are in for hot frying is that we have not pushed hard on being food self-sufficient as a country. 
The impact of this crisis would be less if we at least had enough food of our own.
But because we have neglected our agriculture industry — the sector that takes care of 86 percent of the population — we are now in a fix.
It’s hard to create jobs when you have a million people to feed.
It’s hard to resuscitate an economy when more than half the population can’t feed themselves,
Yet it’s not too late to learn the lesson.

Comments are closed.