Lesotho Launches M68 Million Climate Resilience Support Facility for MSMEs

The Government of Lesotho has taken a significant step toward strengthening the country’s private sector by launching the Climate Resilience and Preparedness Support Facility for Micro, Small and Medium Enterprises (MSMEs). The announcement was made by Hon. Motlatsi Maqelepo, Minister of Trade, Industry and Business Development, as part of the government’s continued efforts to help businesses prepare for the growing impacts of climate change. The initiative recognizes that climate related risks can threaten business operations, reduce productivity and place jobs at risk if companies are not adequately prepared. Through this new support facility, eligible businesses will receive financial assistance to invest in climate resilience measures that protect their operations and improve long term sustainability. The programme reflects Lesotho’s commitment to building a stronger economy while encouraging businesses to adopt environmentally responsible practices that support future growth.

A total of M68 million has been allocated to the Climate Resilience and Preparedness Support Facility through the World Bank funded Competitiveness and Financial Inclusion (CAFI) Project. This substantial investment demonstrates the government’s determination to strengthen the resilience of local enterprises against climate related challenges such as droughts, floods, extreme weather events and changing environmental conditions. Small and medium sized businesses often face greater financial constraints than larger companies, making it difficult for them to invest in infrastructure or technologies that reduce climate risks. By providing targeted financial support, the facility aims to remove some of these barriers and encourage businesses to make strategic investments that enhance resilience. The programme is expected to contribute to economic stability by ensuring that businesses are better equipped to continue operating even during periods of environmental uncertainty.

One of the most attractive features of the facility is the cost sharing model designed to make climate resilience investments more affordable. Under the programme, the Government of Lesotho will finance up to 80 percent of eligible climate resilience investments, while participating businesses will contribute the remaining 20 percent. This arrangement significantly reduces the financial burden on businesses, particularly MSMEs that may not have access to sufficient capital for major resilience projects. By lowering the cost of investment, the government encourages greater participation while ensuring that businesses remain committed through their own financial contribution. The shared investment approach creates a partnership between the public and private sectors that promotes responsible spending and long term sustainability.

The Climate Resilience and Preparedness Support Facility is designed to help businesses strengthen their ability to respond to climate related risks before they become costly disasters. Investing in climate resilience can include improving infrastructure, adopting more efficient technologies, implementing sustainable production methods and introducing systems that reduce operational disruptions caused by extreme weather conditions. These improvements help businesses protect valuable assets, maintain productivity and reduce the likelihood of financial losses during climate related events. In addition to safeguarding investments, the programme aims to protect jobs by helping businesses remain operational during challenging circumstances. Stronger business continuity planning also supports customer confidence, market stability and overall economic resilience across Lesotho.

The launch of this facility also reflects the government’s broader vision of promoting sustainable economic development alongside environmental responsibility. Climate change continues to affect industries such as agriculture, manufacturing, tourism and trade, making resilience an essential component of long term business success. Encouraging businesses to adopt climate smart practices not only protects individual enterprises but also strengthens supply chains and contributes to national economic growth. Businesses that invest in resilience are often better positioned to adapt to changing market conditions, improve operational efficiency and remain competitive in both domestic and international markets. This initiative therefore represents an important investment in the future of Lesotho’s economy as well as its environmental sustainability.

Applications for the Climate Resilience and Preparedness Support Facility are now open to all eligible, formally registered businesses operating in Lesotho. Interested applicants can obtain application forms from the CAFI Project Office, the Ministry of Trade, Industry and Business Development District Offices and through the CAFI Project website. Making application forms available through multiple channels improves accessibility and allows businesses across the country to participate in the programme regardless of their location. Eligible businesses are encouraged to review the application requirements carefully and submit their proposals within the prescribed guidelines. The government hopes that broad participation will maximize the impact of the facility and support businesses across a wide range of economic sectors.

The launch of the M68 million Climate Resilience and Preparedness Support Facility marks an important milestone in Lesotho’s efforts to strengthen its private sector while addressing the growing challenges posed by climate change. Through substantial government support, businesses will have greater opportunities to invest in resilience measures that protect operations, preserve employment and improve long term sustainability. The partnership between the Government of Lesotho and the World Bank funded CAFI Project demonstrates a shared commitment to building a more secure and environmentally responsible economy. By encouraging businesses to prepare today for tomorrow’s climate challenges, the initiative lays the foundation for stronger economic growth and greater resilience across the country. Together, government, development partners and the private sector can build a greener, stronger and more resilient future for Lesotho’s businesses and communities.