Lesotho’s Bold Vision: Water, Energy and Regional Growth with AfDB Backing

“We will hasten to ensure that the right policies and incentives are in place to attract participation from the private sector, particularly in sectors such as health, agriculture, and manufacturing,” said King Letsie III.

The Kingdom of Lesotho is embarking on a transformative journey that leverages its vast natural resources to become a regional leader in renewable energy, water security, and inclusive economic growth. Backed by a strategic partnership with the African Development Bank (AfDB), the landlocked mountain nation aims to reshape its economic landscape and strengthen regional integration with South Africa, Botswana, and beyond.

Historic Visit Sets Stage for Ambitious Development Agenda

During a landmark visit to Maseru, the capital of Lesotho, African Development Bank President Dr. Akinwumi Adesina held high-level talks with His Majesty King Letsie III and government leaders to launch a new era of cooperation. This marked the first official visit by an AfDB president to the country—a gesture King Letsie III hailed as “a strong signal of appreciation for Lesotho’s determination to uplift its people.”

At the core of the discussions was a multi-pronged development partnership aimed at unlocking Lesotho’s economic potential through large-scale investments in infrastructure, energy, agriculture, manufacturing, tourism, and human capital development.

“We will hasten to ensure that the right policies and incentives are in place to attract participation from the private sector, particularly in sectors such as health, agriculture, and manufacturing,” said King Letsie III.

$331 Million Investment to Accelerate Transformation

The African Development Bank Group has earmarked a robust $331 million investment in Lesotho for the 2025–2030 period. These funds will target five key areas: quality infrastructure, energy development, human and institutional capacity building, regional integration, and private sector empowerment.

This financial package is aligned with Lesotho’s upcoming Country Strategy Paper, which emphasizes private-sector-led job creation as a pillar for inclusive and sustainable growth.

“In today’s world, the aid architecture has evolved. We are focused on helping Lesotho develop bankable projects, attract private capital, and build the institutional and technical capacity needed to thrive in a competitive global economy,” said Adesina.

Renewable Energy Powerhouse in the Making

Lesotho is rapidly positioning itself as a renewable energy leader in the region. With abundant hydropower potential from its mountainous terrain, as well as vast wind and solar resources, the country plans to produce surplus electricity by 2026.

To harness this energy bounty, Lesotho will construct a new power substation to export electricity to South Africa. This is part of a broader energy strategy guided by His Majesty King Letsie III’s Just Energy Transition Fund—an ambitious roadmap to develop a carbon-neutral energy system and exceed Paris Agreement commitments before 2050.

“Lesotho’s energy supply will soon surpass its domestic needs. This is a significant achievement for any country, but especially for one with such unique geographical and climatic advantages,” said Dr. Rets'elisitsoe Matlanyane, Minister for Finance and Development Planning.

$2.3 Billion Integrated Water and Energy Project

In one of the largest regional infrastructure efforts, the African Development Bank is spearheading a $2.3 billion multi-partner integrated water transfer project. This initiative includes a 700-kilometer water transfer system that will supply 308 million cubic meters of water for agricultural, domestic, and industrial use across Lesotho, South Africa, and Botswana.

Beyond water security, the project integrates energy infrastructure and trade corridors, contributing to regional economic resilience.

“Lesotho is a critical water tower for Southern Africa,” said Adesina. “This project will not only serve millions across the Orange River Basin but will also position Lesotho as a regional hub for water and energy exports.”

The AfDB is expected to mobilize $260 million of the total cost, underscoring its strong commitment to Lesotho’s leadership in regional water diplomacy and climate adaptation.

Clean Water for All by 2025

At the domestic level, the government aims to achieve universal access to clean water and sanitation by the end of 2025. Significant progress has already been made through the AfDB-financed Lesotho Rural Water Supply and Sanitation Project.

To date, the initiative has delivered:

• 190 kilometers of pipelines,

• Water storage tanks with 3.48 million liters of capacity,

• 166 public water points serving over 28,000 people in Maseru and Berea.

Dr. Adesina personally visited project beneficiaries at Sekete Primary School and Thusong Health Clinic, emphasizing the importance of investing in water, education, and health as core components of human development.

“These children are our future. Every investment in clean water, sanitation, and education is an investment in Africa’s growth,” he said.

Strengthening Human Capacity and Private Sector Growth

Beyond infrastructure, the partnership with the African Development Bank is rooted in people-centered development. The new strategy will bolster education, healthcare systems, and vocational training to prepare Lesotho’s youth for emerging industries in agriculture, manufacturing, and clean energy.

Adesina also met with Prime Minister Samuel Ntsokoane Matekane and several cabinet ministers to align national policy with AfDB’s broader vision for Southern Africa. The discussions emphasized strengthening local institutions, advancing gender equality, and enhancing food and nutrition security.

King Letsie III, who has served as the African Union’s Nutrition Champion since 2014, was praised by Adesina for his unwavering advocacy for child nutrition, youth empowerment, and sustainable development.

Tapping Into Lesotho’s Natural Wealth

Lesotho’s highlands are not just a source of water—they offer immense opportunities in agriculture, eco-tourism, and aquaculture. The government aims to expand irrigation, develop agro-value chains, and promote salmon and trout fish farming in the country’s pristine waters.

The country also holds promise in diamond mining and textile manufacturing—two sectors with high job creation potential and strong export prospects.

“The African Development Bank currently supports eight active projects worth $60 million in Lesotho,” Adesina said. “We are ready to scale up our support to unlock even more value from Lesotho’s strategic geographic and environmental position.”

A Legacy of Partnership and Progress

Lesotho joined the African Development Bank in 1973 and has since implemented 87 Bank-supported projects totaling $429 million. With the renewed partnership, the country is entering a new chapter of accelerated development, resilience, and regional influence.

As Africa grapples with the dual challenges of climate change and inclusive economic growth, Lesotho is setting a bold example of how natural capital, visionary leadership, and strategic partnerships can be harnessed to build a prosperous future for generations to come.