The objective of the New Hospital Public Private Partnership (PPP) Project is to support the Lesotho PPP for

the national referral hospital by expanding the number and types of key services available to patients and acting as a top-up payment to allow additional volume for critical services. The extension is necessary to enable the Recipient full utilization of the GPOBA Grant to complete the implementation of service provision of key clinical services at the main hospital as well as at the three filter clinics, such as doctors' consultations, dental services, dispensing of medicine, ANC, ART, Family Planning, Maternity, etc., which were beset by delays due to: i) delay in signing of the finance agreement, ii) the delay in starting construction of the three filter clinics as a result of the delayed signing of the finance agreement, iii) delay in construction of the main PPP hospital due to inclement weather, and iv) the delay in the assessment by the Independent Monitor (IM) of the performance-based targets linked to payment. The respective request for extension was received on October 24th, 2011 from Tsepong (Pty), Ltd. (the recipient), the private healthcare company and the PPP partner of the Government of Lesotho (GOL) on the project and the recipient of the Grant. The borrower's attached action plan outlines the plan for the completion of activities during the extension period and the schedule for disbursement claim for the extension period.

The objective of the Integrated Transport Project for Lesotho is to enhance prospects for economic growth in the recipient's territory through provision of an efficient and integrated transport system that is safe and affordable to improve access to services and market opportunities for all across the recipient's territory. The project has three components which are as follows: component one - policy and institutional reform in the transport sector; component two - infrastructure investments; and component three - project management and monitoring and evaluation. The Office of the Ministry of Finance, through their letter dated August 10, 2011 has requested the World Bank to extend the closing date of the Project. In response to the government's request, it is to extend the closing date of the Grant Agreement (GA) by one year, from December 31, 2011 to December 31, 2012 The Project Development Objective (PDO) will remain the same as before.

The objective of the Private Sector Competitiveness and Economic Diversification Project for Lesotho is to facilitate increased private sector

investment by improving the business environment and diversifying sources of growth. The restructuring refocuses the project activities on areas that have greater potential to contribute to the Project Development Objective. The project key changes include: (i) a reallocation of available International Development Association (IDA) credit; (ii) a modification of intermediate result indicators to reflect the refocusing of project activities; (iii) the creation of new expenditure categories, i.e. goods, and a reallocation of IDA Credit and Grant to such new expenditure categories; and (iv) a one-year extension of the closing date to June 30, 2013.
The objective of the Second Phase of Water Sector Improvement Project is to support the Kingdom of Lesotho in: (i) developing and sustaining an environmentally sound, socially responsible, and financially viable framework for the Metolong Dam and Water Supply Program (MDWSP); (ii) increasing the quantity of safe, bulk water supplied to Teyateyaneng; and (iii) strengthening institutions and related instruments in the water sector. There are three components to the project. The first component of the project is environmental and social management of the MDWSP. This component will finance activities aimed at addressing environmental, social and cultural heritage protection in accordance with the MDWSP environmental and social management program. These activities fall under three broad subcomponents - environmental, social, and governance communications. The second component of the project is engineering and transmission line to Teyateyaneng. This component will support the water supply works program through: (i) the construction of an estimated 28km of transmission mains to supply the town of Teyateyaneng with water from the Metolong reservoir; and (ii) financing the position of engineering manager within the MDWSP implementing agency. The third component of the project is institutional support. This component will build on phase one of the Water Sector Improvement Project (WSIP), continuing to support the Commissioner of Water (COW) in policy analysis and capacity building assisting in the implementation of measures outlined in the 1999 water policy, the water and sanitation policy of 2007, and the water Act of 2008, while also providing support to the Lesotho Electricity Authority to strengthen capacity to assume responsibility for the regulation of urban water supply services.

The HIV/AIDS Technical Assistance Project for Lesotho aims at building capacity of government agencies and civil society organizations at both the national and local level to address the identified key gaps in implementing the National HIV and AIDS strategic plan in an effort to contain and reverse the epidemic. The second level restructuring aims to: (i) realign the project with the new National HIV/AIDS Strategic Plan (NSP) 2011-2016 by focusing attention on key prevention and mitigation measures: (ii) ensure a more strategic focus by consolidating and prioritizing capacity strengthening support; and (iii) sharpen the results focus through a revised results framework with clearer linkages between the activities to be financed and the expected outcomes. The Project Development Objective (PDO) of building capacity of government agencies and civil society organizations remains relevant and will not be modified. The need for restructuring and the broad strategic directions were discussed during the April-May 2011 supervision mission. Subsequently, the Bank team provided technical support to the government to reach consensus among key stakeholders on a core group of priority technical assistance activities. During the annual meetings the Bank team met with the delegation and firmed up commitment to the restructuring which was finalized during the October 2011 mission. The objective of the Basic Education Project for Lesotho is to provide improved facilities at existing primary schools, support and contribute to expand access to pre-primary education, and support improvements in quality of teaching. There are three components to the project. The first component of the project is to improve the quality of primary school infrastructure. This component will provide additional fully furnished primary gender and disability friendly classrooms at existing schools, along with toilet blocks. Construction will develop within a new approach which makes greater use of smaller contractors, de-concentrated procurement and subcontracting of technical supervision of civil works. This approach is expected to speed up the pace of construction and reduce costs. The second component of the project is to support and contribution to the expansion of pre-primary education. This component will support the Government's aim to maintain and expand access to reception classes especially for the poorest children, through procurement of care givers, procurement of learning materials, and procurement of catering services to existing and additional reception classes. This expansion will support the continued inclusion of an estimated 5.2 percent of the age five population in reception classes over the duration of the project. The third component of the project is contribution to improvements in quality of teaching. This component will support the Government plans to improve learning outcomes in primary schools through: (i) conducting analytical work to understand the conditions of education service delivery, teaching, and learning, through school resources survey, classroom-based observation, skills profiles and training

needs, and assessment of student outcomes measurement; (ii) assisting in increasing the qualification level of the teacher force in 'difficult' school by attracting and/or retaining more qualified teachers in targeted schools and/or upgrading the qualifications of teachers working there; (iii) providing additional in-service teacher training aimed at improving literacy and numeracy teaching; and (iv) providing textbooks in core subjects and grades where there are deficits and learning materials for the implementation of the new curricula.

This project paper seeks the approval of the Executive Directors to provide an additional financing in an amount of Special Drawing Rights (SDR)10.2 million to the Kingdom of Lesotho for the Integrated Transport Project. The additional financing (AF) will help finance: (i) the cost overrun in an amount of US$10 million for the completion of the construction of two bridges and associated road works over Senqu and Senqunyane rivers; and (ii) a scale up activity for the periodic maintenance of 64 km of Nyenye to Makhoroana and Teyateyaneng to Mapoteng Junction road in an amount of US$5 million. The AF is consistent with the Project Development Objectives (PDOs) of the Integrated Transport Project (ITP), which was designed to support a portion of the Government of Lesotho's (GoL) Transport Sector Program (TSP) for the period 2004-2010. In addition, the AF will help alleviate the negative impact of the global financial crisis by creating more employment opportunities, reducing the transport costs of local people, and improving access to basic social and economic services.