The Private Sector Competitiveness and Economic Diversification Project (PSCEDP) is the project of the Government of Lesotho under the Ministry of Trade and Industry, Cooperatives and Marketing with funding from the World Bank. The key mandate of this project is to facilitate private sector investment in Lesotho by improving the business environment and by diversifying sources of growth for Lesotho’s economy. The project first came into effect in 2007. PSCEDP II was relaunched in 2013 to further amplify the successes of the initial project phase. The project is aligned with the Government of Lesotho’s National Strategic Development Plan II (2018-2022) with special focus on economic diversification in the non-textile sectors such as horticulture and tourism, improving the status of Lesotho as an investment destination of choice based on the ease of doing business index as well as private sector-led economic growth. Overall, the Project is envisaged to increase Lesotho’s annual GDP growth by 5%.


The interventions of PSCEDP II are aimed at growing the economy and to make Lesotho become an investment destination of choice through private sector-led economic growth envisaged to create 50,000 new jobs in key sectors such as horticulture and tourism. In particular, PSCEDP seeks to support the Government of Lesotho towards;

  • Improving the business environment
  • Increasing access to finance
  • Investment promotion
  • Support for horticulture and tourism

These interventions are in keeping with broader national goals aligned to employment and income generation, attraction and retention of Foreign Direct Investment (FDI) through private sector-led economic growth. The Project also seeks to leverage and support the poverty reduction strategy of the country with special emphasis on diversification of the economic base as well as the integration of the domestic private sector with other regional economies, especially South Africa.

Key outcomes of PSCEDP also include the creation of 50,000 new jobs created by the private sector and improvement in the ease of doing business in Lesotho. It is envisaged that the outcomes of this Project will improve the position of Lesotho as an investment destination of choice. Overall, the Project is intended to contribute to GDP growth of 5% per year.

The beneficiaries of the Project are Basotho who will derive benefit from the direct increase of their incomes for farmers, Small and Medium Enterprises (SMEs), unemployed sections of society and artisans to name but a few. The government and its affiliated agencies will benefit directly from the Project through technical assistance as they implement the programmes of this Project.
The implementing authorities of the project include;

  • Lesotho National Development Corporation (LNDC)
  • Lesotho Tourism Development Corporation (LTDC)
  • Basotho Enterprises Development Corporation (BEDCO)
  • Central Bank of Lesotho (CBL)
  • Maseru City Council (MCC)
  • Ministry of Trade and Industry, Cooperatives and Marketing
  • Ministry of Forestry and Land Reclamation
  • Ministry of Agriculture and Food Security
  • Ministry of Tourism, Environment, and Culture
  • Ministry of Justice and Human Rights
  • Ministry of Law and Constitutional Affairs and
  • Ministry of Development Planning