Lesotho & Swaziland: Lesotho and Swaziland, Cradled within the South African Ambit, Are Transforming Their Natural Resource, Water, into Wealth through a Series of Massive Development Projects
Ford, Neil, African Business
Turning water into money
Given their size and geographical location, it is not surprising that the economic fortunes of Swaziland and Lesotho are so closely tied to South Africa. Lesotho is totally surrounded by Africa's largest economy and relies upon its neighbour for almost all of its trade, while Swaziland is hardly less dependent.
The two landlocked microstates have both taken advantage of their proximity to South Africa to enter agreements to supply the country with water for a variety of hydroelectric and irrigation schemes. Yet the experiences of the two headline projects--the Lesotho Highlands Development Project (LHDP) and the Komati Basin (KB) scheme in the Swaziland-South African borderlands--have been very different.
The economic base of both Swaziland and Lesotho is limited. Although the two countries have growing tourist sectors which offer a great deal of potential for future economic growth, they are hampered by a lack of transport links and other important infrastructure, and so most visitors continue to visit via Johannesburg International Airport.
The AGOA legislation in the US has offered an opportunity lot the development of textile factories, an opportunity that Lesotho has already seized with both hands. Apart from these two areas of growth, Lesotho and Swaziland largely depend upon agricultural exports to generate foreign earnings. The two also share a common problem with regard to the prevalence of HIVS/AIDS. Apart from the obvious, devastating human cost of the disease, it has taken the lives of many skilled civil servants, teachers, doctors and other professionals. Lying in the heart of Southern Africa, the two small states stand in the front line of the disease, the spread of which has undoubtedly been aided by the number of nationals who are migrant workers, many working in the mines of South Africa.
The World Health Organisation (WHO) estimates that one third of the population of Swaziland is HIV positive, with the figure only slightly lower in Lesotho at 31%. The loss of life and huge number of orphans left in the wake of the disease is threatening traditional family life.
Lesotho and Swaziland have both also been badly hit by the drought and famine that has swept across the region over the past two years. In stone parts of Swaziland, two-thirds of the population are both HIV positive and have been hit by food shortages--not an easy combination to bear.
While the scale of the HIV/AIDS problem was not recognised at the time that the contracts for the LHDP and the KB scheme were drawn up, the two states' financial fragility in the thee of disease and famine has not changed in recent years. It was therefore not surprising that they decided to take the South African Rand in agreeing to the two gigantic water schemes.
BIG ISN'T ALWAYS BEAUTIFUL
The $8bn LHDP is one of Africa's biggest engineering schemes. Serious planning for the series of dams and tunnels in the Maloti Mountains of the Drakensberg began in the 1980s, with construction following by the end of the decade. The main aim of the project is to supply water northwards to South Africa's industrial heartland around Gauteng Province. Although the scheme initially became famous because of its sheer scale, it has become world renowned for the incidence of corruption surrounding the development.
Whether or not the terms unduly favour South Africa is difficult to say. Who can put a price on international trade in water? But the fact that the deal was hammered out between the Apartheid government of South Africa and the military autocracy which then ruled Lesotho indicates that the interests of the Basotho people of Lesotho may not have been at the top of the agenda.
The World Commission on Dams (WCD) notes that "those who bear the social and environmental costs and risks of large dams are frequently not the same people who receive the social and economic benefits. …