Publication:
Lesotho Economic Update: Transforming Fiscal Policy into an Engine of Inclusive Growth

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dc.contributor.authorWorld Bank
dc.date.accessioned2025-04-08T17:42:46Z
dc.date.available2025-04-08T17:42:46Z
dc.date.issued2025-04-08
dc.description.abstractFollowing a decade of low and unstable growth, Lesotho has a unique opportunity to build a new foundation for robust and inclusive development. As real GDP growth pivoted from a 6.3 percent expansion in 2012 to an 8.2 percent contraction in 2020, per capita income levels declined sharply, and Lesotho’s hopes of improving living standards slipped away. However, the country now has a chance to return to a convergence path, as the second phase of the Lesotho Highlands Water Project (LHWP-II), increased revenue transfers from the Southern African Customs Union (SACU), and the renegotiation of water royalties from South Africa are expected to drive economic activity and provide resources for much-needed social spending and infrastructure investment. Seizing this opportunity will require effective prioritization of policies and investments, sound public financial management, and the restoration of sufficient fiscal buffers (savings) to counter negative shocks. This economic update highlights the critical role of fiscal policy in mitigating macroeconomic volatility and fostering sustainable and inclusive growth. It stresses the need for effective fiscal and public investment management reforms to address Lesotho’s economic challenges and unlock opportunities for development. Aligning fiscal policies with the goal of inclusive growth is essential to ensure that benefits reach all segments of society.en
dc.identifierhttp://documents.worldbank.org/curated/en/099040325111028458
dc.identifier.doi10.1596/43035
dc.identifier.urihttps://hdl.handle.net/10986/43035
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.rightsCC BY-NC 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by-nc/3.0/igo
dc.subjectECONOMIC GROWTH
dc.subjectREAL GDP GROWTH
dc.subjectWATER ROYALTIES
dc.subjectFISCAL POLICY
dc.subjectMACROECONOMIC VOLATILITY
dc.titleLesotho Economic Updateen
dc.title.subtitleTransforming Fiscal Policy into an Engine of Inclusive Growthen
dc.typeReport
dspace.entity.typePublication
okr.date.disclosure2025-04-08
okr.date.doiregistration2025-04-14T11:53:53.683316Z
okr.date.lastmodified2025-04-08T14:04:53Zen
okr.doctypeEconomic & Sector Work::Economic Updates and Modeling
okr.doctypeEconomic & Sector Work
okr.docurlhttp://documents.worldbank.org/curated/en/099040325111028458
okr.guid099040325111028458
okr.identifier.docmidP508942-8e25ee32-f163-4ef7-9498-2cc2922ea77c
okr.identifier.externaldocumentum40005014
okr.identifier.internaldocumentum40005014
okr.identifier.report200248
okr.import.id7042
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttps://documents.worldbank.org/curated/en/099040325111028458/pdf/P508942-8e25ee32-f163-4ef7-9498-2cc2922ea77c.pdfen
okr.region.administrativeAfrica Eastern and Southern (AFE)
okr.region.countryLesotho
okr.sectorCentral Government (Central Agencies)
okr.sectorPublic Administration
okr.themeEconomic Growth,Jobs,Fiscal Risk Management,Macroeconomic Modeling,Fiscal Sustainability,Macroeconomic Simulation and Policy Analysis,Fiscal Policy,Inclusive Growth,Job creation,Economic Policy,Macroeconomic Model Development
okr.topicMacroeconomics and Economic Growth::Fiscal & Monetary Policy
okr.topicMacroeconomics and Economic Growth::Economic Growth
okr.topicMacroeconomics and Economic Growth::Economic Development
okr.unitEFI-AFR1-MTI-MacroFiscal-2 (EAEM2)
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