Ntsoaki Motaung
His Majesty King Letsie III this week underscored the critical need to expand agricultural finance in Lesotho, emphasising its role as a key enabler for agricultural transformation.
“This is imperative because the cost of agriculture transformation is enormous; thus, access to finance is a catalyst for growth and it must be addressed urgently,” King stated during the High-Level Dialogue on Food Systems held in Maseru on Tuesday.
Highlighting the challenges faced by the agricultural sector, His Majesty pointed out that financial institutions often minimise their exposure to agriculture due to perceived and real risk considerations.
“It is our belief and hope that beyond this gathering, issues regarding access to finance in the agriculture sector will be addressed,” he said.
King stressed that while there were numerous impediments to the growth of a highly productive agro-food system in Lesotho, finance remained a crucial catalyst for the much-needed transformation.
He called for collaborative efforts to increase commitments and address this challenge.
“To realise advancements in the agro-food value chains, it is essential to have innovative instruments designed by the private sector to mobilise additional resources, address market failures, and remove barriers,” he added.
The dialogue took place against the backdrop of a severe food insecurity crisis in Lesotho.
An alarming 700,000 Basotho—nearly one-third of the country’s population—now face severe food insecurity, a sharp increase from 582,000 last year. The resources required to combat this crisis have surged dramatically from M300 to M500 million last year to at least M1.2 billion this year.
Consequently, on July 12, Prime Minister Ntsokoane Samuel Matekane declared a state of disaster, which will lapse on March 31, 2025, and called on aid organisations for assistance. The government has allocated M200 million to help address the situation.
During the high-level meeting, Food and Agriculture Organisation (FAO) Director-General Dr. Qu Dongyu stressed the importance of coordination, timely delivery, and of not wasting time.
Dr. Qu advised that the first step was to build strength, followed by finding innovative solutions and then swiftly taking action.
He also outlined the three components of food security: food availability, food accessibility, and food affordability, noting their varying levels of challenges worldwide.
Dr. Qu also described the three categories of food quality: staple food to meet basic food security requirements, nutritional food to address malnutrition, and healthy food for a balanced life.
He commended His Majesty for designating August as “Food Month” in Lesotho, reflecting the government’s prioritisation of food security.
He said agrifood systems transformation was critical for food security and requires the collective commitment and action of all partners across the spectrum in support of the Sustainable Development Goals (SDGs).
“We all need to work together as one big team,” Dr. Qu said.
He was part of a high-level delegation from three United Nations (UN) agencies visiting Lesotho from Friday last week to Tuesday this week at the invitation of King Letsie III, who serves as the FAO Special Goodwill Ambassador for Nutrition.
The delegation included World Food Programme (WFP) Assistant Executive Director for Programme and Policy Development Valerie Guarnieri, and the International Fund for Agricultural Development (IFAD) Associate Vice-President for Programme Management Donal Brown.
Minister of Finance and Development Planning Dr. Retšelisitsoe Matlanyane reminded attendees that over a decade ago, the African Union (AU) Commission resolved that at least 10 percent of national budgets should be allocated to financing agriculture.
“It is against this background that the government of Lesotho adopted the ambitious and expensive policy of providing subsidized agricultural inputs to local farmers,” she explained.
“No matter how much money we pump into agriculture, we will not achieve the desired results if we do not make equally huge investments in the other policies and infrastructure that support agriculture,” Dr. Matlanyane asserted.
“We need innovation and technology, and lastly, we need an alignment of our policies. Our microeconomic policies have not, for a very long time, been aligned with market-driven objectives. That alignment is necessary. We have to be aligned to achieve our goals in a sustained and systematic manner.”
First National Bank (FNB) Lesotho CEO, Delekazi Mokebe, speaking on behalf of the Bankers Association of Lesotho (BAL), addressed concerns about banks providing credit to farmers.
“I think the elephant in the room is, do banks provide credit to farmers? And the answer is yes, of course they do,” she stated.
Mokebe debunked the myth that banks do not lend to the agricultural sector, emphasising that banks are profit-making businesses that make money through lending.
“Banks make money from lending. Therefore, we have to lend. Correct? And in that lending, we do both short- and long-term funding for our agribusinesses,” she explained.
She noted that banks provide not only transactional but also trade solutions to support agriculture and farmers.
