CAFI works hard to repair dented image


. . . non-compliance, sexual harassment cost factories

… dedicates M113 million to industrial growth


MASERU – The Competitiveness and Financial Inclusion (CAFI) Project is working hard to restore the country’s image as a sourcing destination by addressing challenges related to social compliance and productivity, especially in factories. CAFI is collaborating with stakeholders, including the Ministry of Labour and Employment, the Lesotho National Development Corporation (LNDC), the Employers’ Association, and trade unions.

This initiative follows a trend where factories have lost orders due to allegations of non-compliance, including sexual harassment. In an interview with Public Eye, CAFI Project Deputy Project Manager for Implementation, ’Makali Nathane, said the project targets all factories to address challenges such as factory closures due to a lack of orders, low productivity, and non-compliance with social and environmental sustainability standards.

She noted that the project aims to build the capacities of enterprises to comply with market requirements at pre-production, production, and post-production stages.“Social and environmental sustainability aspects and possible certification against selected international standards will be addressed across these stages. “The project will also improve enterprise competitiveness through productivity-focused interventions and by strengthening the capacity of textile and clothing enterprises to improve their business functions along the value chain.

“This will enable some enterprises to upgrade from simple cut, make, trim (CMT) operations to full-on-board (FOB) offerings and, potentially, to full-package offerings,” Nathane explained. The project has allocated US$6 million (M113,627,376.85) for this component, aimed at supporting industry growth through enhancements at the factory level and promoting social and industrial compliance.

This will be achieved by implementing a programme combining elements of the ILO’s Sustaining Competitive and Responsible Enterprises (SCORE) programme, the International Trade Centre’s (ITC) Global Textile and Clothing (GTEX) programmee, and the Better Work programme previously implemented in Lesotho.

The programme is expected to increase Lesotho’s participation in the global value chain and benefit at least 50 textile and apparel firms, impacting over 30,000 Basotho workers, 80 percent of whom are women. Nathane added that CAFI aims to increase business support services and financial products targeted at women and youth. Specifically, CAFI has established an Entrepreneurship Hub and Seed Financing Facility to build a comprehensive entrepreneurship ecosystem in Lesotho with skilled Enterprise Support Organisations to incubate enterprises and link them with markets.

The Lesotho Enterprise Assistance Programme (LEAP) is another initiative providing matching grants to enterprises to improve their productivity and competitiveness. Additionally, the Lesotho Horticultural Incubation and Training Centre has been established to expand the commercial production of deciduous fruits and vegetables. These initiatives are designed to benefit at least 500 businesses, 50 percent of which are women while 25 percent of which are youth.

On the other hand, the National Clothing, Textile, and Allied Workers Union (NACTWU) Secretary General, Sam Mokhele, said the project’s intention to assist factories is a positive gesture aimed at restoring jobs lost by factory workers. He noted that this will also equip Basotho with the right knowledge about international markets, ensuring they are not left stranded if investors leave.

“Some challenges addressed by the project include Lesotho’s reliance on exporting only clothing. Through the CAFI project, there is an opportunity to diversify exports and create new products. Funding in this country often comes from international sources and may not always achieve its intended purpose, but this project aims to change that,” he said.

The CAFI Project is a six-year initiative of the Ministry of Trade, Industry, Business Development, and Tourism. The Government has received a loan from the International Development Association (IDA) of the World Bank to implement the CAFI Project. The Project Development Objective (PDO) is to “increase access to business support services and financial products targeted at micro, small, and medium enterprises (MSMEs) and entrepreneurs, especially women and youth.”

The project, which commenced in 2022 and is expected to end in 2028, is funded through a $45 million (M849,614,029.92) loan with a supporting grant of $7.5 million (M141,580,625.26), totalling $52.5 million (M990,944,154.33). Additionally, a $950,000 (M17,931,370.41) grant was received specifically for the horticulture initiative from the India, Brazil, and South Africa (IBSA) Fund.

Leave a Reply

Your email address will not be published. Required fields are marked *