Chapter two: Country background and context Africa that witnessed the demise of apartheid and the onset of democratic rule in 1994, SACU has been undergoing restructuring. Renegotiation of the new SACU agreement was concluded in 2002 and subsequently signed and ratified by all five member states. The new agreement provides for, among others, a new system in respect of the common revenue pool and the revenue-sharing formula (CBL 2003:7). 2.4 Conclusion: strengths, challenges and future prospects for Lesotho Strengths 75. Since the 1820s, when King Moshoeshoe I founded the Kingdom of Lesotho, the Basotho have successfully struggled to preserve their independence. Throughout the colonial period, they resisted annexation plans, at first to the Cape Colony and later to South Africa, and became an independent sovereign state in 1966. Lesotho is to be commended for its resilience as a sovereign nation and for the preservation of its autonomy against great odds. The homogeneity of the nation as regards language, culture and religion forms a sound basis for social cohesion and nationbuilding. 76. Lesotho has maintained its traditional chieftainship system and the heritage of the monarchy and has incorporated both into a modern, democratic governance architecture. The coexistence of multiparty, democratic electoral systems, the separation of powers between the three organs of state (the executive, Parliament and the judiciary), and the fact that the king reigns, but does not rule, are all provided for in a written constitution and constitute a major governance achievement of the Basotho that is worthy of emulation. 77. Lesotho was plunged into several decades of misrule ranging from de facto one-party rule to military authoritarianism. In spite of these governance upsets, Lesotho has managed to turn this around and establish a relatively stable democracy. Since 1993, when democracy was restored, Lesotho has demonstrated a capacity for constitutional innovation by adopting the MMP system, a system that has increased the representation of small parties in Parliament and has helped to diffuse one of the main causes of postelection violence. The general acceptance of the new electoral model as inclusive and representative of all shades of political opinion has been one of the main achievements of the past five years. This model also won Lesotho credibility regionally and internationally as a way of deepening democracy and ensuring political legitimacy. 78. The landscape of the country is picturesque and unique in the world. Water, which is a key resource that is being exploited, continues to provide Lesotho with foreign exchange earnings. The landscape has the potential to provide a niche in tourism. 79. Lesotho is said to have one of the highest literacy rates in Africa. Challenges 80. The attainment of relative political stability notwithstanding Lesotho’s political landscape has been characterised by considerable political uncertainties and violent contestations, particularly during elections. 37