Africa-Press – Lesotho. Against the tough global economic climate, the Minister of Finance Hon. Thabo Sophonea said the country will adopt tough fiscal measures. This is contained in the 2022/2023 budget speech.
The budget was unceremoniously tabled in parliament last week as the process was frustrated due to chaos that broke out at the National Assembly caused by the
members of the majority ruling party in the coalition, All Basotho Convention (ABC). The budget is done under the theme: “Building a Resilient, Sustainable and Innovative Economy: Fiscal Consolidation amid COVID -19”
He said some policies will point a country to a better development trajectory. “Lesotho like other countries is still recovering from the scourge of COVID-19, which
has deep negative socio-economic impacts. Therefore, the budget speech I am delivering today will present a mix of policies that will set a firm foundation
of shifting the development trajectory to a sustainable one,” reads the budget speech. The government usually comes under fire for poor financial management and lack of
accountability by the alleged culprits found wanting in the public cookie jar. He pointed out that the COVID-19 sponsored economic turndown and floods continue
to have an impact on social and economic climate thereby disturbing the key sectors. The economic contractions together with the projected lesser SACU [Southern African
Customs Union] revenue have added weight to our external and fiscal positions. Sophonea noted that there has been achievements that were registered over the past
financial year but warned that “there are challenges that require continuing political courage and commitment in order to make meaningful advancements in
achieving broad-based economic growth”. The Minister added: “Such growth must hold noticeable developments in the livelihoods of the people. You will agree with me when I say: “it is only when
we observe and achieve this fundamental purpose that our national budgets become relevant”. For the 2022/2023 fiscal year, the total expenditure estimates are proposed at M24.8
billion of which the recurrent expenditure is M18.1 billion and capital expenditure is M6.8 billion. “IMF projects [the] global economy to slow to 4.4 percent in 2022 from 5.9 percent
in 2021 before weakening further to 3.8 percent in 2023. Sub-Saharan Africa is forecasted to grow at 3.7 percent in 2022 before expanding to 4 percent in
2023. However, high energy prices and elevated inflation are expected to carry along with their uncertainty in the medium-term global growth. “Growth
in South Africa is expected to return to its pre-pandemic levels at 2.1 percent in 2022 before averaging 1.8 percent over the medium-term. Meanwhile, inflation
prospects for 2022 have been revised upwards to 4.8 percent from 4.5 percent. In 2023, inflation is expected to moderate at 4.5 percent,” reads the budget
speech. He further highlighted that these global developments may hold better fortunes for the country. Sophonea commended the Lesotho Revenue Authority (LRA) for a “maintained excellent
performance in support of Government’s drive to provide services to our people”. He showed that in the 2021/2022 fiscal year it made a collection of M7.2 billion against the target of M6.4 billion, M745 million surplus on tax
revenue collection. “Lesotho and Millennium Challenge Corporation concluded Compact II negotiations in February 2022. This landmark agreement will transform Lesotho`s economic
landscape. We owe it to ourselves as the people, to ensure that the agreement comes to force, and we successfully implement the projects in the Compact, that
is, Health Systems Strengthening project; Market-Driven Irrigated Horticulture Project; Business Environment and Technical Assistance Project,” the Minister noted.
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