economy
Lesotho’s economy is a small one compared to many others around the world. Its GDP for 2003 was estimated at US$1,3 Billion, with an annual growth rate of 3.4%. Its per capita GDP was approximately US$550 and its annual inflation that same year was estimated at some 10%.
Its economy grew significantly during the early 1990s as a result of the Lesotho Highlands Water project, and this especially in the construction sector. This was followed by growth in the manufacturing and textile industries. Mining has also seen some growth as resources gained in value. Indeed, being landlocked, and completely surrounded by South Africa, its economy is integrated with that of South Africa’s. Lesotho’s road infrastructure has also improved tremendously in the last 10 years, with the assistance of aid from donor nations and organisations. This has meant access into the mountains of the country, allowing for further development of those upper regions. The country has also relied on and continues to rely on revenue from the Southern African Customs Union (SACU), thus allowing the government to provide improving and improved services to the population. This source of income will no doubt reduce in years to come as its neighbour, South Africa’s economy shows signs of slowing down. Lesotho’s natural resources include but are not limited to Water, agriculture and other land (primarily for grazing), diamonds and other minerals, and Labour, which is primarily “exported” to the mines and other heavy industries in South Africa. It has relied on and continues to rely extensively on Aid from various donor countries and organisations including the World Bank, the International Monetary Fund (IMF), the European Union (EU), the United Nations (UN), the United Kingdom (UK), Ireland and the United States (USA). The recently approved second phase of the Lesotho Highlands Water project is to destined to contribute towards Lesotho’s growth in the next 5 – 10 years, especially in the construction sector previously mentioned. Currency and Foreign Exchange Lesotho’s official currency is the “Loti” (Singular) or “Maloti” (Plural). The currency is pegged to the South African Rand, with both currencies freely used throughout the country. Visitors should be sure to change all their “Maloti” into Rands or other foreign currencies before leaving the country as changing them internationally is difficult, if not impossible. |
Source: ExchangeRates.org.uk
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