2016年-世界发展银行全球_Kingdom_of_Lesotho___Country_Partnership_Framework_2016-2020_78页_2mb

Country Partnership Framework (CPF) for the Kingdom of Lesotho (FY16-20)

Core Content

The World Bank Group (WBG) Country Partnership Framework (CPF) for Lesotho outlines the strategic focus areas and objectives for the period FY16-20, building on the previous Country Assistance Strategy (CAS) from 2010 and the Systematic Country Diagnostic (SCD) from 2015. The CPF emphasizes two main focus areas: improving efficiency and effectiveness of the public sector and promoting private sector job creation. It also addresses key risks to the implementation of the WBG program, including political, macroeconomic, climate-related, and operational risks.

The CPF includes an envelope of SDR 110 million, with actual and indicative allocations from IDA17 and IDA18. As of May 2016, the undisbursed balance for the current IDA lending portfolio stood at US$51.3 million. The framework is supported by a portfolio of Advisory Services and Analytics (ASA) to guide policy advice and CPF priorities.

Main Points

1. Country Overview

• Lesotho is a small, landlocked, lower-middle-income country with a per capita GNI of US$1,350.
• It is one of the poorest countries in Southern Africa and has one of the highest levels of income inequality in the world.
• The country is surrounded by South Africa and relies heavily on SACU revenues, exports of textiles, water, and diamonds.
• The national currency, the Lesotho Loti (LSL), is pegged to the South African rand.
• Lesotho's main trading partners are South Africa and the United States.

2. Development Challenges and Fragility

• Lesotho faces growing macroeconomic and capacity risks, leading to increasing fragility.
• The country has high poverty and inequality, with a projected 57% of the population living below the poverty line and 34% below the extreme poverty line.
• The economy is highly dependent on SACU revenues, which have been declining due to South Africa's economic conditions and the impact of the 2015/16 El Niño-induced drought.
• Lesotho's growth is projected to slow to 2.4% in 2016/17, down from a 4.5% average over the previous five years.
• The country has high prevalence of HIV/AIDS (24%) and tuberculosis (TB) (852/100,000), and poor health outcomes, including high maternal and infant mortality rates.
• Lesotho's public sector wage bill is among the highest in the world, growing from 18.9% of GDP in 2012 to 23.1% in 2015/16.

3. Strategic Development Priorities

• Fiscal sustainability is a top priority, as Lesotho faces large fiscal and current account deficits.
• Public sector efficiency and effectiveness are crucial to avoid negative impacts on growth and service delivery.
• Private sector development is needed to create jobs and diversify the economy.
• Climate resilience is essential, given the country's vulnerability to climate variability and environmental shocks.

4. Key Risks

• Political and governance risks: Lesotho experiences chronic political uncertainty, with unstable coalitions and a small parliamentary majority.
• Macroeconomic risks: Declining SACU revenues, high inflation, and fiscal imbalances threaten economic stability.
• Climate change and disaster risks: Lesotho is vulnerable to climate-induced disasters such as drought and erratic rainfall.
• Operational risks: Capacity and fiduciary risks in public service delivery and financial management.

Focus Areas and Strategic Objectives

4.1 Focus Area I: Improving Efficiency and Effectiveness of the Public Sector

• Improve public sector and fiscal management: Enhance transparency and accountability in public spending.
• Improve equity of the social assistance system: Ensure fair and effective delivery of social services.
• Improve basic education outcomes: Focus on education quality and access.
• Improve health outcomes: Strengthen the health system and address HIV/AIDS and TB.

4.2 Focus Area II: Promoting Private Sector Job Creation

• Improve the business environment and diversify the economy: Streamline regulations and encourage entrepreneurship.
• Improve smallholder and MSME agriculture productivity: Support sustainable agricultural practices and increase competitiveness.
• Increase transport connectivity: Facilitate private sector growth by improving infrastructure.
• Increase water and renewable energy supply: Support industrial and export opportunities.

Key Information

• The CPF aims to support the Lesotho Vision 2020 and the National Strategic Development Plan (NSDP).
• The WBG will focus on public sector reform and private sector development.
• The CPF includes technical assistance and financial support to address these challenges.
• Lesotho's financial inclusion is relatively high due to informal financial services, but remains low with respect to formal services.
• MSMEs are largely unbanked, which constrains growth and poverty reduction.
• The Government of Lesotho has adopted a Financial Sector Development Strategy (FSDS) to increase financial inclusion and reform the sector.

Summary of CPF Objectives

• Restoring fiscal sustainability by improving public spending efficiency.
• Enhancing public service delivery to improve social outcomes.
• Promoting private sector growth to reduce poverty and increase employment.
• Building climate resilience to mitigate the impact of environmental shocks.
• Mitigating risks through strong governance, transparency, and effective monitoring.

Supporting Elements

• Advisory Services and Analytics (ASA): Will inform WBG policy advice and CPF priorities.
• Monitoring and Evaluation (M&E): Strong emphasis on M&E to ensure program effectiveness.
• Stakeholder consultations: Summarized in Annex 8.
• Results Matrix: Provided in Annex 1 to track CPF outcomes.

Conclusion

The CPF for Lesotho (FY16-20) is a comprehensive strategy aimed at addressing the country's development challenges and fragility. It focuses on improving the public sector and promoting private sector growth, while also addressing macroeconomic, political, and climate-related risks. The success of the CPF will depend on the government's political will, capacity to implement reforms, and the WBG's support through financial and technical assistance.