By Seleoe Nonyane
Natural resources minister, Mohlomi Moleko, has expressed dissatisfaction with the Lesotho Highlands Development Authority (LHDA)’s operations.
Speaking at a stakeholder meeting at ‘Manthabiseng Convention Centre last Friday, Moleko said instead of becoming a strong organisation, LHDA has become a weak entity over the years.
The meeting was aimed at announcing opportunities that come with the second phase of the multi-million Lesotho Highlands Water Project (LHWP II) that is implemented by LHDA.
“They (LHDA) understand that there is a need for a new strategic plan. LHDA has to underscore the word ‘development’, meaning it has to focus on water transfer, hydropower generation, agriculture, tourism, and other projects that the Lesotho government may give it from time to time.
“The anticipation was that LHDA would spur the development of this country but its concentration has been on water transfer. Phase I and Phase II have the components of social development and what should happen in issues such as the compensation of communities, social responsibility by the contractors, and the security plans.
“We still have some communities that have not been compensated; for instance, about M200 million needs to be released to the Ha Mohale area. This shows the loss of focus towards components to benefit Basotho. We need to come up with a new strategic plan so that by the end of the seven years of the building of tunnels and dams LHDA will be a big organisation instead of scaling down,” he pointed out.
Moleko’s remarks came out after some local companies accused the LHWP II of favouring foreign companies over local ones in the awarding of major tenders.
One of the concerned businessmen, Teboho Moletsane, berated LHDA for its policy of setting a 10 percent procurement quota for indigenous companies.
Moletsane said he did not quite comprehend how the 10 percent was arrived at, adding that it is made even more of a bitter pill to swallow by the fact that the project does not adhere to the quota which he said is shared with non-native companies.
“The project has secured a lot of funding, so the 10 percent quota is too little. LHDA’s claims of maximising benefits for Basotho are inaccurate.
“For example, it is now a prerequisite for truck owners to provide a list of all the equipment they possess before starting work. Most of the time they do not possess such equipment yet and the tender is withdrawn.
“The question is, does this policy not shut out Basotho businessmen who would otherwise apply for loans in order to secure a contract worth M9 billion or M7 billion? After the appointment is there still an obligation for him to partner with other Basotho business owners?” he asked.
Moletsane urged LHDA to relook the remaining works so that more opportunities are available to Basotho who will then have the capacity to secure even bigger tenders.
His sentiments were echoed by Lesotho Chamber of Commerce and Industry (LCCI) business committee representative, Thabiso Moroahae, who lamented that none of the equipment being used in the project is owned by Basotho-owned construction companies.
Moroahae accused those were involved in the LHWP II negotiations, especially the Lesotho Water Commission, of failing to protect Basotho businesses as even a mere shovel is bought straight from China instead of local hardware stores.
“Look at sand and concrete for instance. Chinese contractors mine these resources straight from the source, thereby eliminating local dealers and pushing them out of business,” he pointed out.
In response, LHDA chief executive officer, Tente Tente, told the disgruntled Basotho-owned construction companies that it was not responsible for formulating its procurement policies and procedure.
Tente said LHDA was created by the government of Lesotho as an implementing agency of the LHWP, and is governed by a board and the Lesotho Highlands Water Commission (LHWC).
“We have a compliance function within LHDA that confirms that we do not only comply with the procurement policy, but also with other instruments and laws of this country. Internal audits check that LHDA complies with internal controls and that everything is in order.
“I understand that the 10 percent quota has raised eyebrows. However, it emanates from the Phase II agreement, article 10 (c) which states that consultants and contractors based in Lesotho and South Africa shall share the value of infrastructure work from an equal monetary basis taking into account amongst others their shareholding and operational experience.
“In March this year, we were standing on 49 percent, while South Africa was at 51 percent, and the aim is to be on 50:50,” he said.
Tente stated they intend to rebalance the remaining advanced infrastructure programme to ensure that LHDA complies with the instruments.
He indicated that article 10 (F) of the same agreement suggests that in the adjudication of tenders, preference margins may be considered for companies including joint ventures registered in Lesotho and South Africa to encourage capacity building and economic growth
“It also says that preference margins shall be determined by the LHWC. Our bosses have the authority to engage with their SA counterparts to deal with the instrument. As the implementing agent we will be able to implement the new instruments once they have been negotiated.
“One of the things that make the contract successful when the evaluation tender process is done is to demonstrate the equipment that will be used in the works.
“There are improvements that we can make going forward. To ensure how meaningful the participation is we are open to suggestions that will make this project a success.
“We stick by our policy objective which is to maximise opportunities for Basotho, and we were clear that when it comes to the advanced infrastructure these works will be shared between the two countries and there will be no international players,” he noted.
For his part, prime minister Samuel Matekane said there are issues that need to be looked into between Lesotho and South Africa when it comes to the treaty.
Matekane revealed that preparations were underway to review the Phase II agreement and the Lesotho Highlands Water Project Treaty.
He proclaimed that all opportunities in the country must benefit its citizens and it is the desire of the government to support and ensure that that Lesotho Highlands Water Project Treaty review comes to fruition.
He also explained that the LHDA was appointed by the Lesotho government as implementer of all aspects of the projects.
“So, it is LHDA’s responsibility to ensure that they protect Basotho’s businesses so we can attain all the goals the country wants to achieve,” Matekane added.
