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NATIONAL DIALOGUE ON PRIVATISATION AND RESTRUCTURING OF THE LESOTHO
ECONOMY: MASERU, 1-2 SEPTEMBER 1999
OPENING ADDRESS BY THE RIGHT HONOURABLE THE PRIME MINISTER MR PAKALITHA
MOSISILI, MP
Honourable Ministers
Your Excellencies
Distinguished Guests
Ladies and Gentlemen,
1. I feel highly honoured to have been invited to open this important
National Dialogue on Privatisation and Restructuring of the Lesotho
economy. As we begin this dialogue, we need to keep in mind that the
overall objective of the economic restructuring launched in 1995 is to
ensure sustained economic development in which the private sector takes
the lead and Government provides an enabling environment. Indeed in my
view this important dialogue is not solely about the privatisation
process and individual transactions. The dialogue should also devote
sufficient attention to managing the economy efficiently. Equally
importantly, it should help to define respective and complementary roles
of Government on one side and the Private Sector on the other in order
to achieve the goals of sustainable economic development and employment
creation.
2. My first observation is a simple one. Government and the Private
Sector need one another to operate the economy efficiently. Experience
has shown that Government cannot run the economy on its own, in key
sectors such as transport, banking and financial services,
telecommunications, housing, water and energy without the involvement of
the Private Sector. Government does not have sufficient capacity of
human resources, capital, and the management skills to cope with all the
demands of operating on its own a whole national economy or its key
sectors. At the same time, there are many areas which require direct
Government involvement such as regulation and licensing to assure
orderly business operations.
3. The Private Sector especially in Lesotho also has its limitations.
There are limitations of entrepreneurial skills even to identify
business opportunities and needs for services as they arise. We
witnessed this limitation with Phase IA of the Lesotho Highlands
Development Project when the Lesotho Private Sector failed to identify
and respond to the business opportunities presented by this vast
project. There are other limitations such as poor co-operative
organisation whereby prospective Basotho investors are unable to come
together to raise capital because of deeply engrained individualism and
mutual suspicions. It is obvious then that the Private Sector itself
also needs to restructure itself to play a more meaningful role in
accordance with the needs of the times.
4. It is therefore clear to me that one of the principal requirements
for an efficient and growing economy is a good relationship between
Government and the Private Sector based on mutual trust and
co-operation. I am aware of the shortcomings of the Public Service, and
the many complaints that Ministers and Members of Parliament receive
from the Private Sector about shoddy and indifferent service. This is
indeed a key political challenge to the Government regarding what should
be done to improve the efficiency of the Public Service. Ironically the
solution that is increasingly being put forward is that Government
should privatise more of its services.
5. I wish I could say that I see in Lesotho a Private Sector which tries
to play its role with great efficiency, but I am afraid, I am unable to
say so at this National Dialogue. Government also receives many
complaints from the general public including foreign visitors about a
Private Sector which delivers indifferent and shoddy service, a Private
Sector that seeks to avoid paying taxes, and a Private Sector that tries
to undermine and sometimes to corrupt regulatory authorities. In
privatisation I have personally seen a Private Sector that is quick to
criticise and assign blame, and yet is slow to come up with positive
suggestions. This also is a key political challenge to us all of how to
develop a dynamic, forward looking and creative Private Sector.
6. Taking a look at the international environment, it should be noted
that in past years up to say ten years ago the independent countries of
Southern Africa had a special niche among donors because of the
situation then prevailing in neighbouring South Africa. Even then,
however, donors have always been frank enough to say that foreign aid
was not popular among constituents in their home countries. Today the
situation is much more difficult than it has ever been: for a variety of
reasons foreign aid has almost dried up completely. A key political
problem is that many among us continue to behave as if Foreign Aid is
still available to bail us out of our economic difficulties. Ladies and
gentlemen let us face reality once and fall all. Foreign Aid is no
longer available to us.
7. In the place of foreign aid we have to look for foreign investment.
Foreign investment requires a predictable, welcoming environment with
political stability. It is therefore incumbent upon all politicians to
contribute their views towards a national consensus on economic
strategies so as to move away from the ridiculous situation where some
political leaders and their followers actively campaign to discourage
investors from locating in Lesotho all because of their own narrow
political ambitions.
8. In view of these changed circumstances one would assume that all
Basotho should agree that we should strive for the best allocation of
limited economic resources available in Lesotho. The nation can no
longer afford the dissipation of precious national resources in
subsidies to ill-managed state-enterprises. One would also assume that
by now nobody expects a free lunch and consequently it is strange to
hear that some people expect that state enterprises that are being
privatised should be given to them for free. It is high time to realise
that we should all look for an economy in which everybody works hard for
their share of the national cake.
9. We live in a rapidly changing economic environment in which there are
fundamental changes in economic relationships and in economic
strategies. One of these changes is that the Private Sector is expected
to play a larger role in the economy. It is a challenge which we cannot
afford to ignore. The Government has to acknowledge that it cannot do
everything in the economic arena, that it has to call up the strengths
and dynamism of the Private Sector in its efforts to combat poverty and
to generate employment. That is why we are earnestly calling for a new
Smart Partnership in this National Dialogue between the Government and
the Private Sector because we are aware that some people are afraid of
changes itself. Adaptation to changing circumstances is a simple rule of
survival: those who do not adapt die like Dodo.
10. We, in Government, shall look forward with keen interest to the
outcome of the deliberations because this dialogue affords us all a
unique opportunity to review and refine our strategies for economic
survival. This is a major political responsibility which we cannot
evade. Let us therefore all rise to the challenge of understanding this
difficult process to restructure our economy. With these high
expectations I am pleased to declare the National Dialogue open and wish
you fruitful deliberations.
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