business

July 8, 2021

NEO SENOKO

3 min read

Parly halts PAC hearings

Parly halts PAC hearings

Communications Minister Sam Rapapa

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THE government has expressed its satisfaction over the compliant behavior demonstrated by the Public Accounts Committee (PAC) in putting on hold investigations into the Fraser Solar saga, pending ongoing court cases lodged by the German solar company.

The Minister of Communications Sam Rapapa said on Wednesday that the government requested that the investigations be put on hold as the matter is already in court.

The country came under the spot light two months ago after the German company, which signed a solar deal with Lesotho in 2018, won an arbitration proceeding against the Lesotho government in a South African court over the said agreement and was subsequently awarded damages as a result.

The company revealed that it signed an agreement in 2018 to provide as many as 40 000 solar water-heating systems, 20 megawatts of solar photovoltaic capacity, 1 million LED lights and 350 000 solar lanterns.  

While the German government agreed to finance the programme, the company says, the Lesotho finance ministry failed to execute the project’s financial arrangement and the government has not engaged with the legal process.

Frazer Solar approached the Johannesburg High Court and was granted for seizure of the government’s assets, however Lesotho is in the process of challenging the decision.

With all these shenanigans on the side of the government of Lesotho, the PAC instigated investigations into the matter, with several high ranking officials including the former Minister in the Prime Minister’s Office, Temeki Tšolo and former Government Secretary Moahloli Mphaka having already testified.  

But, the PAC investigations have been put on hold following a request by the Speaker of the National Assembly, Sephiri Motanyane.

In a letter, Mr Motanyane said the investigations will prove costly prejudicial to local courts, particularly with the ongoing case in South Africa, to which Lesotho is a party.

“…the result is, this ongoing investigations by the PAC will prove costly and prejudicial to our courts. Preparations are under way to approach the High Court of Lesotho to have the court ruling on this matter revoked and set aside,” the letter stated. 

It said the same information collected by the PAC could be used against the country by its opponents in court to gain advantage or have influence over the case.

Frazer Solar has begun seizing Lesotho’s assets abroad in order to enforce €50m in contractual damages. It has already taken control of royalties that Lesotho earns on water and power supplies to South Africa, after a US court gave it the go-ahead two months to employ tactics similar to those used by creditors to chase countries that have defaulted on their debts.

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Lesotho reneged on an “outstanding opportunity” to acquire renewable energy assets, including a 20-megawatt solar plant, when it abandoned a deal to finance the project in 2018, Frazer Solar said.

This was despite sign-off by the office of the then-prime minister Motsoahae Thabane, the solar company says.

A South African arbitrator this year said the company should have about half of the €100m in damages it sought.

Prime Minister, Dr Moeketsi Majoro said he did not know about Frazer Solar’s damages claim until it was reported in South African newspapers.

“Lesotho’s properties both in Lesotho and overseas are protected and we don’t think the action that they are proposing will succeed,” Majoro said last month.

But Frazer Solar said that it had notified the government more than two dozen times about its lawsuit and the seizures.

 

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