Sunday, April 21, 2024
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Financial tsunami befalls Lesotho


By Theko Tlebere

When the Prime Minister of Lesotho Moeketsi Majoro announced a fourteen days’ total lockdown in Lesotho, it wasn’t very clear how the economy will be affected. Reason being he blatantly indicated that essential services and grocery shops would be opened with restrictions. Little did we know that street vendors and many other sectors would be mostly hit by this total lockdown. This week I want us to look closely at the economic implications that Lesotho will endure during the tenure of the lockdown. I will intentionally dissect the current economic situation in Lesotho, by trying to benevolently articulate some of the tried and tested economic strong holds for Basotho in the villages and small towns of Lesotho.  Even though this topic has been extensively exhausted on various social media platforms I realized the need to focus on the seismic effects that Covid-19 will have on Lesotho’s financial strength.

According to the United Nations (UN) trade agency forecast back in March last year, $1trillion would be lost to the global economy due to Covid-19. International organizations contemplated an arrangement for a multi-billion-dollar injection for low income and emerging markets like Lesotho. Having made that short narration, I would like to categorically indicate that the economy of Lesotho relies mostly on agriculture, livestock, manufacturing, mining, and depends on a high influx of workers’ remittances induced from the Southern African Customs Union (SACU). The narration for today will focus on the agricultural and manufacturing sector because of their populace and the current conundrum of financial tsumami that is befalling them.

Even though Lesotho’s lockdown has allowed the agricultural sector to continue being operational, it’s essential to bring it home that while farmers are busy making sure there is enough cabbage for the market, street vendors have been instructed to close shop. The sad part about this narration is that while street vendors have been instructed to stay home, the textile sector is still operational. Allow me to put it in better words that while my government has closed shop for street vendors in fear of super spreading the virus, it has endorsed more than forty-five thousand textile employees to continue reporting for work. One would say, but what did I expect the government to do, because once they ordered closure of textile firms it would mean they would have to promise them the five hundred (M500.00) maloti as a relieve measure and it doesn’t look like government was ready for that.

As I try so hard to showcase the financial tsunami that we are faced with as a country, allow me at this juncture to make a spinoff that will not augur well with my government. While it’s a holy initiative to have a total lockdown as I said last week, it was also equally essential for government to come up with remedy measures for all sectors that will be affected by the lockdown. The ambiguity of allowing supermarkets and wholesalers to open shop and sell the same items that are found in the streets is serious hypocrisy from my government. If supermarkets are allowed to open shop because they have been instructed to follow certain safety protocols, then how come the same protocols cannot apply to the street vendors? The complexity of this issue is further aggravated by the fact that while employees in supermarkets are guaranteed their full salaries at the end of the month, the street vendors earn their keep from daily sales. It’s a hand to mouth kind of trading therefore living many in a dare financial tsunami.

The ambivalence of having a big number of low income earners having to stay at home for fourteen days says a lot about the economic intentions that we have as a country. My take on this one is that government needs to strike a balance in putting measures to curb Covid-19 and making sure that the economy keeps thriving. The intuition about this whole financial battle will not be solved by a once-off M500.00 given selectively to street vendors, but rather making an economic arrangement that allows continual trading for street vendors and other small-scale and medium enterprises (SMes). Opening shop for textile industry and closing street vendors simply means there is no supply for the large market that is availed, and that does not make any economic sense for a small country like Lesotho that is swimming at a rate of more than 60% of its people living under the poverty line, and has more than 28% unemployment rate. I want to close today’s chapter by showcasing my dismay in the report that’s being published recently that is purported to come from the Auditor General about National Covid-19 Secretariat (NACOSEC) blowing M1.5billion. Please I have nothing against NACOSEC but the amount of money being used there to pay staff (if it’s true) is really unwarranted. The financial tsunami that we are facing now is aggravated by the syphoning of money on salaries and acquisition of vehicles while there are pressing issues like the relieve fund that needs to be established to aid the struggling businesses that have been closed. We are only on the eighth day of the lockdown and economically if feels like a year already, we still have six more and all I can predict is a serious financial tsunami coming our way. The future is Now! fffffff

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