Resource information
The report looks at Lesotho, a
predominantly mountainous, land-locked, poor country with a
small population, limited natural resources, and a very
fragile ecology. It has low gross national income, and a
significant poverty level. To ameliorate this condition, the
government has embarked on a pro-poor, growth strategy that
includes public, and private investment in infrastructure.
It explores the level of private participation at this phase
in the evolution of the reforms, which is considerable,
given the country's small size, limited institutional
capacity, and lack of public and private investment capital.
Telecommunications has recorded the most significant reform
of any of the infrastructure sectors. Other than
telecommunications, reforms in other sectors have not
advanced significantly. Not surprisingly, the report
identifies specific lessons learned from the
telecommunications sector, and examines their relevance to
reform efforts under way in the other sectors. In summary,
this report finds that private participation in
infrastructure could offer Lesotho three key advantages: 1)
augmenting budget resources in cases where the private
sector undertakes to finance projects, or services that
would not otherwise be funded, 2) improving the quality and
efficiency of service delivery, and, 3) accelerating
investments in infrastructure. By the same token, the report
makes clear that private participation in infrastructure
(PPI) carries significant down-side risks that, despite the
best of intentions, could lead to negative fiscal impacts,
lower than expected service quality, disruptions to service,
or more dire consequences. The report presents an action
plan with three primary elements: 1) the creation of a PPI
Facilitation Unit to assist line ministries in implementing
PPI projects; 2) specific priorities pertinent to each
respective infrastructure sector; and, 3) cross-cutting
reform measures addressing policy, regulatory, and legal
actions needed to provide an enabling framework, and
facilitating environment for PPI projects.
