WASHINGTON, June 3, 2013 –The Board of Directors of the World Bank approved today a grant in the amount of US$20 million for the Government of Lesotho (GoL) for the First Growth and Competitiveness Development Policy Grant.
The first in a series of grants to support competitiveness and inclusive growth, this Development Policy Operation (DPO) is a central component of the World Bank’s Country Assistance Strategy (CAS) in Lesotho for 2010-14. It supports two areas of the CAS; competitiveness, diversification and fiscal adjustment, public-sector efficiency.
“This operation supports the government’s efforts in implementing the National Development Plan. In particular, it will reduce costs for business, support measures to improve the efficiency of public expenditures and support incomes for poor families and children”, said Asad Alam, World Bank Country Director for Lesotho.
The DPO will help improve the country’s investment climate and private sector competitiveness. This will be done through reducing turn-around times for setting up business and for obtaining manufacturing and trading licenses as well as reducing the number of days for clearing imported and exported goods by 2016.
The number of days to register a firm will improve from 40 to 7 days and the number of days to obtain trade and manufacturing licenses will be reduced to 3 from 5, whilst it will take 240 days to obtain a construction permit, an improvement by 90 days from 330 days. The number of days for import and export clearance will improve to one day from 4.5 and 4.7 days respectively.
The DPO series will also help improve the sustainability and efficiency of public spending, through fiscal consolidation and public financial management and public procurement system reforms.
Furthermore, it with assist with access to service delivery and the improvement of social protection and monitoring systems, through more targeted social safety net programs such as the National Information System for Social Assistance (NISSA) which will be expanded to 25 000 households from 10 000 of those who are benefitting from the Childs Grants Programme.
“These reforms will help promote the growth of private enterprises through creating a competitive business environment, which is essential for attracting investment and creating new jobs that are essential for reducing poverty and promoting equity,” said World Bank Senior Country Economist for Lesotho, Christian Gonzalez.
The World Bank has been active in Lesotho since 1966 and to date has disbursed U$522 million in grants and concessional finance. It has a portfolio of seven projects with an undisbursed amount of US$45.3million.