MASERU — Lesotho and the World Bank on Thursday signed financing agreements worth US$23 million (about M189 million) for the Metolong Dam and Water Supply Programme.
The money will also be used to fund agricultural projects for smallholder farmers in Berea, Butha-Buthe, Leribe and Mafeteng districts.
About M107 million will go towards a water project that seeks to improve the quality and quantity of water supplied to Teyateyaneng.
The remaining M82 million will help smallholder farmers increase food production in the districts of Berea, Butha Buthe, Leribe and Mafeteng.
Speaking at the signing ceremony Finance Minister Timothy Thahane said the grants will help lay a foundation for sustainable economic growth in Lesotho and improve the standard of living for Basotho.
“By making improvements in water supply for our rapidly-growing urban areas and boosting food production and marketing opportunities in farming communities, we are laying the foundation for sustainable economic growth and human welfare,” Thahane said.
“Agriculture and water are two critical sectors in the Lesotho economy.”
Speaking at the same occasion, the World Bank Country Director for Lesotho, Ruth Kagia, said: “We are proud to be a partner with Lesotho in strengthening its agricultural sector and promoting sustainable management of water resources needed for growing urban populations and sustaining industrial growth.”
In a press release the World Bank said the grant will help develop an “environmentally sound, socially responsible, and financially viable framework for the Metolong Dam and Water Supply Programme that will increase quantity and quality of water supplied to Teyateyaneng district and strengthen water sector institutions”.
“About US$10 million will support small farmers increase their production of marketable commodities, strengthen their capacity to respond more readily to market requirements,” the bank added.
“The funds will also go towards addressing resource management concerns so that viability of natural resources such as land and water can be conserved to benefit farm productivity.”
One of the key components of the project is increasing the competitiveness of the agricultural sector.
The agriculture project was prepared by the government of Lesotho in conjunction with the International Fund for Agricultural Development (IFAD).