By Thoboloko Ntšonyane
MASERU- Lesotho is taking a step towards inclusive economic growth with the implementation of the Regional Value Chains Lesotho (RVCL+) Project, an initiative aimed at boosting trade and regional integration.
This is according to the statement issued by the Ministry of Trade, Industry and Business Development.
The EU-SADC Economic Partnership Agreement, grants preferential access to European markets.
The RVCL+ initiative focuses on enhancing the competitiveness of micro, small, and medium-sized enterprises (MSMEs) and promoting economic diversification holds significant potential for increasing Lesotho’s export capacity in the future.
Launched in October 2023 and set to run until September 2026, this project is co-financed by the European Union with €6 million about M116 million and the Government of Germany with €950,000 approximately M18 million. It is implemented under the Lesotho Economic Growth, Job Creation, and Economic Partnership Agreement (EPA) Implementation Support Programme, with the Ministry of Trade, Industry, and Business Development leading its execution.
The RVCL+ Project focuses on two key value chains to capitalise on trade opportunities under the EU-SADC Economic Partnership Agreement (EPA):
Agro-processing, Processing of indigenous herbs, cosmetics, and spices
Light Industry: Utilisation of duck and geese feathers and down for textiles and clothing.
These sectors were identified for their high potential to contribute to industrial growth, exports, and job creation.
The Ministry reports that since its inception, the project has delivered outcomes, including: market intelligence training for 19 officials; EPA Rules of Origin workshops benefiting over 100 public and private sector participants; workshops on duck and geese production, training over 60 producers in Maseru; a June 2024 event that engaged over 230 participants, highlighting trade opportunities under the EU-SADC EPA; development of an export guide and regulatory checklist to assist businesses in meeting compliance requirements; draft selection criteria to ensure transparency in identifying high-potential MSMEs for technical support and the identification of certification needs for MSMEs, with links to accredited certifiers across the Southern African Development Community (SADC) region.
The World Bank reports that in 2023, Lesotho’s economy expanded by 0.9%, driven mainly by the public sector and construction projects like the Lesotho Highlands Water Project-II.
The fiscal balance also was reported to have improved, shifting from a deficit of 5.7% of gross domestic product (GDP) in 2022 to a surplus of 6.1% in 2023, largely due to more than doubling of South African Customs Union (SACU) revenues.
The RVCL+ Project is positioned as a driver of Lesotho’s economic transformation, aiming to enhance local manufacturing, expand exports, and strengthen regional trade integration.
It is believed that through supporting MSMEs, producers, and industry stakeholders, the initiative contributes to building a more competitive and sustainable economy.