Sovereign Project

South Africa - Lesotho Highlands Water Project (LHWP), Phase II

South Africa · {'name': 'Emfuleni', 'coordinates': '-26.62837 27.7812'}, {'name': 'City of Tshwane Metropolitan Municipality', 'coordinates': '-25.65985 28.44343'}

Water sector policy and administrative management · Public investment / AfDB sovereign financing

Estimated cost57m XDR
Financing soughtAfDB sovereign financing approved
Project structurePublic investment / AfDB sovereign financing
Target date2030-12-30
Sponsor / contactLesotho Highlands Development Authority

Lesotho Highlands Development Authority
RDGS

South Africa

Description

The proposed project fits with the objective to deepen regional integration and promote industrialization in South Africa. It also realizes the GoKL’s aspiration to boost benefits from its natural resources and develop its infrastructure to create the necessary enabling conditions for private sector development. Both South Africa and Lesotho are inextricably linked socially and economically, and the project is further cementing their relationship for mutual development. The Project is one of the Southern Africa Development Community (SADC) priority water infrastructure projects for promoting regional integration. The Project is estimated to cost ZAR 32.562 billion (UA 1.576 billion), net of taxes and duties. The AfDB loan of ZAR 1.3 billion and NDB loan of ZAR 3.2 billion will finance, on pari-pasu basis, part of component B – Main works covering Polihali Dam and Polihali Transfer Tunnel works. The Project will provide secure and sustainable water sources to the population living in the Gauteng Region covering five provinces (Guateng, Freestate, Mpumalanga, North West and Northern Cape Provinces) of South Africa with a combined population of 26 million and 60% of South Africa’s economy. The water delivered and transferred to the Vaal River System will ensure water availability for domestic consumption, irrigation, industries and mining. On the Lesotho side, more than 85,000 people will benefit upon completion of the project, which is bound to impact positively on community development activities, private sector growth through improved infrastructure and contribute to Lesotho’s socio-economic development.

Status
Ongoing
Last update
14 Aug 2026
Source
African Development Bank Group · IATI
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