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* Lesotho has seen a massive surge in investment since the African Growth and Opportunity Act was signed in to law in the USA in 2000, now a third of all apparel traded through AGOA is from Lesotho. Investment, mainly from Taiwan, has predominantly been focused around ‘water-greedy’ textile factories.
* Unfortunately, infrastructural support has not kept pace with the rate of investment. Now Maseru, Lesotho’s capital and the place where much investment has been situated, is facing a double crisis:
1. A water supply shortage is reaching a critical level. As DFID state, “Without water the industry simply shuts down.”
2. The effluence produced by the textile factories fails to get treated and is pumped into the water system. This is illegal in all other countries and the Environmental Bill of 2000, when signed into law will also make it illegal in Lesotho.
This report details the causes and consequences of this situation, which could reverse economic growth, “in the absence of any intervention or resolution of the constraints… employment… will decline sharply post 2004”.
* Possible solutions to this crisis are discussed, and particular attention is paid to a DFID proposal that treatment plants operated by factories could recycle 75% of industrial waste water. This could create a ‘win-win’ situation in which cost-recoverable investment in water treatment plants could provide a sustainable resource base allowing industrial expansion.
* However, we point towards the inability of stakeholders to drive forward appropriate plans and projects.
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