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© 2005 International Monetary Fund

December 2005

IMF Country Report No. 05/438

Kingdom of Lesotho: Selected Issues and Statistical Appendix

This Selected Issues paper and Statistical Appendix for the Kingdom of Lesotho was prepared by a staff team of the International Monetary Fund as background documentation for the periodic consultation with the Kingdom of Lesotho. It is based on the information available at the time it was completed on September 1, 2005. The views expressed in this document are those of the staff team and do not necessarily reflect the views of the government of the Kingdom of Lesotho or the Executive Board of the IMF.

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INTERNATIONAL MONETARY FUND

KINGDOM OF LESOTHO

Selected Issues and Statistical Appendix

Prepared by a staff team consisting of Anupam Basu (head), Jian-Ye Wang, Jacob Gons, Iyabo Masha, Victor Lledo (all AFR), and Jan Kees Martijn

Approved by the African Department

September 1, 2005

Contents

Basic Data

I. The Institutional Arrangements of the Common Monetary Area and Policy Implications for Lesotho

  • A. Introduction

  • B. Broad Objectives

  • C. Currency Arrangements

  • D. Movement of Funds within CMA

  • E. Access to the South African Financial Markets

  • F. Gold and Foreign Exchange Transactions

  • G. Compensation Payments

  • H. Other Provisions

  • I. Policy Implications for Lesotho

Text Figures

I.1 Common Monetary Area: Terms of Trade Index, 1999-2004

Text Tables

I.1. Selected Economic Indicators

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Lesotho: Basic Data 1/

article image
Sources: Lesotho authorities; World Bank; and IMF staff estimates.

Fiscal year is April-March.

Average number employed in South Africa.

Southern African Customs Union.

Lesotho Highlands Water Project.

Contents

  • II. Competitiveness and export Performance in Lesotho

    • A. Introduction and Background

    • B. Trade Preferences

    • C. Exchange Rate Developments

    • D. Wage Costs and Firm Profitability

    • E. Nonwage Costs and Investment Climate

    • F. Conclusions

  • Text Figures

  • II.1 Evolution of Garment Exports to the United States

  • II.2 Exchange Rate (US$/Loti), 1995–2005

  • II.3 Effective Exchange Rate, 1995–2005

  • II.4 Nominal Effective Exchange Rates, 1995–2205

  • II.5 Real Effective Exchange Rates, 1995–2005

  • II.6 Nominal Exchange Rate, 2000–2005

  • II.7 Unit-Labor Costs of Selected Garment Exporters, 2002

  • II.8 Lesotho Monthly Wages, 1998–2004

  • II.9 Unit Value of US Garment Imports, 1995–2005

  • II.10 Garment Sector Estimated Profitability Development, 1998–2004

  • II.11 Median Firm Losses due to Crime and Security Costs

  • II.12 Regulatory Burden (percent of management time spent dealing with government regulation), 2004

  • Text Tables

  • II.1 Garment Sector Wages for Selected Countries, 2002

  • II.2 Electricity Costs and Reliability

  • III. The Management of HIV/AIDS in the Kingdom of Lesotho

    • A. Background

    • B. The Overall Strategy

    • C. Progress in implementing the strategy

  • Text Tables

  • III.1 HIV/AIDS Programs, Outcome Indicators and Targets, 2003-07

  • Statistical Appendix Tables

  • 1. Gross Domestic Product by Sector (At constant 2003 prices), 1998/99–2004/05

  • 2. Gross Domestic Product by Sector (At current prices), 1998/99–2004/05

  • 3. Gross Domestic Product by Expenditure, 1998/99–2004/05

  • 4. Consumer Price Indices, April 1998 – April 2005

  • 5. Basic Monthly Minimum Wages, 1997–2004

  • 6. Public Service Employment, 1997/98–2004/05

  • 7. Central Government Operations, 1998/99–2004/05

  • 8. Government Revenue and Grants, 1998/99–2004/05

  • 9. Southern African Customs Union (SACU) Operations, 1998/99–2004/05

  • 10. Economic Classification of Government Expenditure, 1998/99–2004/05

  • 11. Functional Classification of Government Expenditures, 1998/99–2004/05

  • 12. Outstanding Government Domestic Debt by Instrument and Holder, 1998–2005

  • 13. Monetary Survey, March 1999 – September 2005

  • 14. Assets and Liabilities of the Central Bank of Lesotho, March 1999–March 2005

  • 15. Assets and Liabilities of Commercial Banks, March 1999–March 2005

  • 16. Principal Aggregates of Commercial Banks’ Operations, March 1999-March 2005

  • 17. Sectoral Distribution of Commercial Bank Loans and Advances to the Private Sector and Statutory Bodies, March 1999–March 2005

  • 18. Interest Rates Paid by the Central Bank on Commercial Bank Deposits, March 1998–August 2001

  • 19. Interest Rates at Commercial Banks, March 1999–March 2005

  • 20. Comparative Money Market Rates, March 1998–March 2005

  • 21. Balance of Payments (in millions of U.S. dollars), 1998/99–2004/05

  • 22. Balance of Payments (in millions of maloti), 1998/99–2004/05

  • 23. Services and Income Account, 1998/99–2004/05

  • 24. Lesotho Miners in South Africa, 1997–2004

  • 25. Composition of Recorded Exports, 1998–2004

  • 26. Direction of Trade, 1999–2003

  • 27. Public and Publicly Guaranteed External Debt Outstanding, 1998/99–2004/05

  • Appendices

  • I. Summary of the Tax System, July 2005

  • II. Exchange and Trade System

Kingdom of Lesotho: Selected Issues and Statistical Appendix
Author: International Monetary Fund