After Trump tariff hit, Lesotho turns to SA and other markets

News24

8 hours ago

Lesotho is courting buyers in Asia and elsewhere for its textiles after producers were battered by the uncertainty surrounding US President Donald Trump's new tariff regime, and has already secured new business from neighbouring South Africa.
'We are pursuing alternative markets from all over,' Trade Minister Mokhethi Shelile said in an interview. 'That's in Southeast Asia, Asia, Africa and Europe.'
The Southern African Customs Union, a free-trade bloc that comprises Lesotho, Botswana, Eswatini, Namibia and South Africa, is a priority market, and its members are 'positively responding to us,' he said.
The US threatened to impose a 50% tariff on imports from the mountain kingdom in April — the highest in the world at the time — when Trump unveiled sweeping reciprocal levies on trading partners. Orders from the US, Lesotho's largest export market for textiles, dried up almost overnight, causing factories to halt operations and severe job losses.
After a more than three-month pause, the levy was lowered to 15%. While positive, the reduction 'is not good enough for our textile industry,' as buyers may switch to nations with even lower reciprocal tariffs, Shelile said. Goods from competitors Eswatini and Kenya are being subjected to 10% duties.
The textile sector — Lesotho's biggest private employer — employs 12 000 people and supports 40 000 indirect jobs. US buyers include retailers such as Walmart, JC Penney and Levi Strauss & Co.
The tiny African nation, surrounded by South Africa, is angling for a tariff of 10% or less and sees room for further talks with the Office of the US Trade Representative as it looks to diversify sales beyond its biggest garment buyer.
'Already we're looking to pivot away from the US and some factories are exporting to South Africa,' Shelile said. The main issue which remains is how fast orders for the textile industry can pick up to avert disaster, he added.
A two-year national state of disaster that Lesotho's government declared last month amid soaring unemployment will remain in place.