- Prime Minister Pakalitha Mosisili of Lesotho took place at the inauguration of South Africa's First National Bank (FNB) offices in Maseru, the capital. While FNB promised that its new banking services would "add capacity to the economy" in Lesotho, PM Mosisili promised that his government was "committed to restoring investor confidence" in the country.
First National Bank is one of the leading banking groups in South Africa, which is also taking a lead in the Common Monetary Area (CMA) in Southern Africa - or those countries whose currency is bound to the South African rand. Already operating in Namibia and Swaziland, the new offices in Lesotho means that the Bank "will now operate in all CMA countries," noted Richard Hudson, CEO of FNB Lesotho.
The new operation will add capacity to the economy and will contribute to upgrading financial services in Lesotho. "We have been able to rapidly transfer new technologies and infrastructure to establish the operation," said Mr Hudson at the opening ceremony in Maseru.
More than 80 percent of staff employed are Lesotho citizens, the Bank said. "We are transferring skills and technologies to Lesotho by placing a minimal number of South African expatriates in the new operation we will accelerate this process," explained Mr Hudson. We have chosen to start this new venture from a clean slate. FNB has set up an entirely new operation with a new customer base," he added.
The importance of this new bank to the Mountain Kingdom was underlined by the presence of many members of the Basotho government, who witnessed Prime Minister Mosilili perform the official opening. FNB came into Lesotho at a time when government was committed to, and placed high priority on the creation of a market economy, "in which local and foreign private sector plays a leading role in resource mobilisation, investment and job creation", the PM said.
The Basotho Prime Minister emphasised that the country was committed to "restoring investor confidence" in Lesotho, following "the unfortunate political crisis" of 1998. Mr Mosisili went on to assure investors of the Kingdom's commitment to creating an environment conducive to investment.
According to an official statement by the Basotho government, Lesotho has "embarked on a new route whose hallmarks are peace and stability, the rule of law, and good governance."
The entrance of FNB into Lesotho therefore, was "very significant for government as it is a mark of confidence in the political, economic and financial stability, and the peace that now rein in the country," the statement said. The entry of FNB into the financial sector would also "introduce much needed competition in the banking sector and provide more financial services to Basotho."
However, the country needed to change some of its financial regulations, the Prime Minister said, pointing to regulations regarding the registration of companies as an example. "It is simply not acceptable that in Lesotho it takes an average of 91 days to register a company while in South Africa, the same process takes only nine days, in Australia two days and in Canada two to four days," he said.
- To correct this situation and create a business and investor-friendly environment and institutions that support private sector-led growth, the government plans to develop a reform agenda, jointly with the private sector whose focus will be on how to make Lesotho a preferred destination for foreign and domestic investment, the government informed.
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