This unique greenfield project entails the design and construction of a new 390-bed hospital in a medical village near Maseru and the refurbishment of its filter clinics. The medical village also accommodates other health facilities, such as the Mohlomi Mental Hospital, a tuberculosis hospital and home for orphaned and vulnerable children.
Lesotho faces significant health challenges. Its life expectancy declined from 60 years in 1996 to 43 years in 2007, and maternal mortality rose from 205 per 100 000 live births in 1986 to 1 200 in 2005. According to the Lesotho Health and Welfare Strategic Plan, the overcrowding of government health centres contributes to these poor health outcomes.
The project delivers essential social services, brings private sector investment and skills to the health sector, and generates employment and broad-based local economic development. It has strong economic empowerment effects, targeting healthcare personnel and women.
The DBSA acts as a lead arranger and underwriter for the project, and assumed the credit risk on behalf of local investors and empowerment parties. The project was undertaken on the basis of a public private partnership at a total cost of R1, 2 billion.
The Bank contributed a senior loan of R680 million and mezzanine debt of R60 million. The government of Lesotho provided a R400 million grant, while the project sponsors invested R60 million in the form of equity. The project is the first public-private partnership in this sector in southern Africa (outside of South Africa) and represents an innovative, workable model for responding to the serious health challenges in the region.