Relations with the Fund
(As of March 31, 2014)
Membership status: Joined 07/25/1968; accepted the obligations of Article VIII, Sections 2, 3, and 4: 03/05/1997.
General resources account:
|SDR Million||Percent Quota|
|Fund holdings of currency||31.13||89.19|
|Reserve position in Fund||3.81||10.91|
|SDR Million||Percent Allocation|
|Net cumulative allocation||32.88||100.00|
Outstanding purchases and loans:
|SDR Million||Percent Quota|
|Approval||Expiration||Amount Approved||Amount Drawn|
|Type||Date||Date||(SDR Million)||(SDR Million)|
Projected obligations to fund (SDR million; based on existing use of resources and present holdings of SDRs):
An update safeguards assessment of the Central Bank of Lesotho was completed in November 2012 in connection with the augmentation of access under the ECF arrangement approved in April 2012. The assessments confirmed that the CBL has taken steps to strengthen safeguards since the 2010 assessment, but also that risks remain. In 2010, Deloitte (South Africa) was appointed as the CBL’s external auditor. The firm has since completed the audits of financial years 2010, 2011, and 2012 within the three-month statutory deadline and issued an unqualified audit opinion following each audit. Since the 2012 assessment, aspects of the monetary data reporting process have been strengthened with IMF technical assistance.
Lesotho is a member of the Common Monetary Area (CMA) and the Lesotho loti is both de facto and de jure pegged at par to the South African Rand, which is also legal tender in the country. Lesotho has accepted the obligations of Article VIII, Sections 2, 3, and 4, of the Articles of Agreement and maintains an exchange system free of restrictions on the making of payments and transfers for current international transactions. Staff is currently assessing whether certain exchange measures maintained by Lesotho and recently identified by LEG are consistent with Article VIII of the IMF’s Articles of Agreement. As of March 31, 2014, the maloti rate per U.S. dollar was M10.2.
Article IV consultation:
The 2012 Article IV consultation was concluded by the Executive Board on April 19, 2012. Lesotho is on the standard 12-month Article IV consultation cycle.
The Fund has been providing Lesotho with technical assistance and training to help authorities strengthen their capacity to design and implement effective policies. Technical assistance covers wide range of areas in macroeconomic, fiscal, and monetary. Specific technical assistance projects since 2008 are the following:
|Fiscal Affairs Department|
|Improving Revenue administration fundamentals||Short-term||2014|
|Resources and non-mining taxation||Short-term||2013|
|tax policy and mining fiscal regimes||Short-term||2013|
|Developing cash management||Short-term||2013|
|Develop the post control audit function in customs||Short-term||2012|
|Develop risk management function||Short-term||2012|
|Public financial management||Short-term||2011|
|Strengthening arrears management and expenditure central||Short-term||2011|
|Public financial management||Short-term||2010|
|Banking laws and regulation||Short-term||2008|
|Financial sector regulations||Short-term||2008|
|Monetary and Capital Markets Department|
|Risk management framework||Short-term||2014|
|Payment system modernization||Short-term||2014|
|Enhancing banking supervision||Short-term||2014|
|Payment systems oversight||Short-term||2014|
|Strengthening insurance supervision||Short-term||2014|
|Financial soundness indicators||Short-term||2014|
|Strengthening liquidity management and capacity building for||Short-term||2013|
|financial stability analysis and reporting|
|Establishment of a risk management function||Short-term||2012|
|Assessing Banking system stability||Short-term||2012|
|Risk management framework||Short-term||2013|
|Monetary and financial statistics||Short-term||2013|
|Financial stability assessment||Short-term||2012|
|Liquidity management framework||Short-term||2012|
|National payment systems||Short-term||2012|
|Money market development and capacity building for financial||Short-term||2012|
|stability analysis and reporting|
|Strengthening Insurance supervision||Short-term||2012|
|Banking system stability||Short-term||2012|
|Monetary and Financial Statistics||Short-term||2011|
|Monetary and financial statistics||Short-term||2011|
|Financial sector supervision||Short-term||2011|
|Payment systems modernization||Short-term||2008|
|Monetary operations/Bank supervision||Short-term||2008|
|External sector statistics||Short-term||2014|
|External sector statistics||Short-term||2013|
|National accounts statistics-follow up||Short-term||2013|
|External sector statistics||Short-term||2012|
|National accounts statistics||Short-term||2011|
|SRF data development||Short-term||2011|
|Balance of payments||Short-term||2010|
|Monetary and financial statistics||Short-term||2009|
|Balance of payment||Short-term||2008|
|Government Finance Statistics: GDDS Project for Anglophone||Short-term||2008|
The IMF maintains the Office of Resident Representative in Lesotho. Mr. Michael Tharkur was appointed the Fund’s Resident Representative to Lesotho in April 2012.
The JMAP Bank-Fund Matrix
(As of March 31, 2013)
|Title||Products||Provisional Timing of missions||Expected Delivery date|
|Bank work program in next 12 months|
|IMF work program in next 12 months||Macroeconomic policy analysis and advice and IMF program|
|Fund request to Bank||Ongoing|
|Bank request to Fund|
|Joint products in next 12 months|
Lesotho—Statistical Issues Appendix as of end-April 2014
Assessment of Data Adequacy for Surveillance
General: Data provision is broadly adequate for surveillance with some key data shortcomings in fiscal and external sector statistics.
National Accounts: Bureau of Statistics (BOS) compiles and reports national accounts statistics on an annual basis. Statistical methods used to derive GDP have improved and new sources of data were developed, although serious challenges remain. National accounts were revised and rebased in 2008 and 2009. New sources of data, including VAT records, the 2008 labor force survey, 2010-11 household budget survey, household consumption surveys, and ongoing economic census (business survey) have improved the quality of the national accounts. Annual GDP estimates in current prices and volume terms from the production, expenditure, and income sides are currently produced and published by the BLS. Other macroeconomic indicators, such as high-frequency industrial production/trade indices, are used to monitor developments during the year. The source data needs to be improved by developing high quality data on intermediate consumption for key economic activities, intra-SACU exports and imports, and gross fixed capital formation in machinery and equipment, and formal and informal construction activities. Private consumption and gross fixed capital formation are now estimated within the framework of a supply and use table, although a discrepancy between supply and use leads to a discrepancy between GDP by activity and expenditure. BOS, with the help of Fund’s TA, intends to begin compiling quarterly national account series.
Price Statistics: The official monthly consumer price index (CPI), a composite of urban and rural price data, is available on a timely basis. The index has been re-referenced to March 2010=100, using 2002/03 Household Budget Survey. The work on developing producer and export price indices is ongoing. In the meantime, the national accounts rely on South Africa’s producer price index and import price indices, used as deflators for imports from SACU- and non-SACU countries, respectively.
Government Finance Statistics (GFS): The compilation of GFS is consistent with GFSM 2001, although the quality, timelines, and periodicity of data have shortcomings. GFS are not provided on a regular basis and the quality of data remains poor, as indicated by significant discrepancies between transactions above and below the line. GFS are compiled from the Integrated Financial Management Information System (IFMIS), supplemented with data from the Lesotho Revenue Authority (LRA), other government departments and units and the banking system. Teething problems experienced with phasing in the IFMIS and in the absence of monthly reconciliation of all Treasury accounts, the coverage of revenue and expenditure data could be incomplete The authorities have been working with international partners, including the EU, the World Bank, and FAD on improving the functionality of the IFMIS and launching monthly reconciliation of all Treasury accounts. GFS is compiled for central government and general government statistics are not available.
Monetary and Financial Statistics (MFS): The Central Bank of Lesotho (CBL) reports monetary data on a regular basis based on Standardized Report Forms (SRFs), with monthly data disseminated through the IFS. Improved data sources helped improve classification and sectorization of accounts. The institutional coverage of MFS needs to be expanded to include other depository and other financial corporations.
Financial sector surveillance: The CBL has begun the process of compiling FSIs on a consistent basis and started by recreating consistent FSIs since 2006. FSIs on depository corporations are reported on a quarterly basis with a lag. However, FSIs on non-financial corporations, households, and real estate markets are not available. A recent mission visited Maseru during April 7–April 11, 2014 to assist CBL staff in the compilation of FSIs according to the FSIs Compilation Guide and work with CBL staff to disseminate the FSI data and metadata on the IMF’s FSI website.
External Sector statistics: Lesotho benefited from technical assistance provided by STA on the compilation of external sector statistics. Until recently, the CBL compiled and disseminated detailed quarterly balance of payments data in accordance with BPM5. The April 2014 technical assistance mission assisted the CBL in converting the quarterly balance of payments and international investment position (IIP) to the BPM6 framework, which eliminated a number of errors and inconsistencies in data. From the subsequent release, data will be published under BPM6 format. External debt database includes outstanding and contracted loans, their currency composition, debt service and amortization, as well as scheduled future disbursements and debt servicing. The centralized database for external grants has not been regularly updated.
Data Standards and Quality
Lesotho is a GDDS participant. GDDS metadata have been posted on the Fund’s Dissemination Standards Bulletin Board since August 2003. Pending metadata updates in GDDS include those referring to recent/prospective revisions of the national accounts, government finance, and balance of payments statistics.
Lesotho: Table of Common Indicators Required for Surveillance
As of April 30, 2014
|Date of Latest Observation||Date Received||Frequency of Data1||Frequency of Reporting1||Frequency of Publication1||Memo Items:|
|Data Quality–Methodological Soundness8||Data Quality–Accuracy and Reliability9|
|International Reserve Assets and Reserve Liabilities of the Monetary Authorities2||Apr-16-2014||Apr-16-2014||D||D||Q|
|Central Bank Balance Sheet||Apr-16-2014||Apr-16-2014||D||D||Q|
|Consolidated Balance Sheet of the Banking System||Feb-28-2014||Apr-11-2014||M||M||Q|
|Consumer Price Index||Feb-28-2014||Apr-11-2014||M||M||M|
|Revenue, Expenditure, Balance and Composition of Financing4—General Government (GG)5||N.A.||N.A.||N.A.||N.A.||N.A.|
|Revenue, Expenditure, Balance and Composition of Financing4–Central Government||Dec-31-2013||Apr-2014||A||I||A|
|Stocks of Central Government and Central Government-Guaranteed Debt6||Dec-31-2013||Jan-16-2014||M||I||A|
|External Current Account Balance||Dec-31-2013||Mar-7-2014||Q||Q||Q|
|Exports and Imports of Goods and Services||Dec-31-2013||Mar-7-2014||Q||Q||Q|
|Gross External Debt||Dec-31-2013||Jan-16-2014||M||I||A|
|International Investment Position7||Dec-31-2013||Mar-7-2014||Q||Q||Q|