In brief

Sam Matekane of the Revolution for Prosperity party will serve as prime minister until the next election in 2027, although political fragility will persist. Proposed reforms to rein in the overbearing political role of the army and security forces are unlikely to be implemented. An expected economic recovery in South Africa and other members of the Southern African Customs Union (SACU) from 2024 will support revenue from the SACU bloc. Lesotho will continue to run a large fiscal deficit, albeit one easing down over the forecast period. GDP will pick up, but remain weak, as work continues on the second phase of the Lesotho Highlands Water Project. Lesotho will continue to record a structural current-account deficit in 2024-25, but this will narrow to 7.1% of GDP in 2024 and 6.5% of GDP in 2025, in line with an expected recovery in diamond prices and high SACU transfers. 

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