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The Independent
5 hours ago
- Business
- The Independent
As Trump's tariff deadline looms, a clothing factory in the tiny African nation of Lesotho goes dark
The deafening roar of hundreds of sewing machines has gone silent. Spools of thread in every color are covered in dust. The warehouse is dark and empty. In the tiny African nation of Lesotho, clothing manufacturer Tzicc's business has dried up in the face of tariffs imposed by U.S. President Donald Trump 's administration. A few months ago, work was steady. The factory's 1,300 employees has made and exported sportswear to American stores, including JCPenney, Walmart and Costco. But when Trump announced sweeping new tariffs on nearly all U.S. trading partners in April, Lesotho found itself topping the list, with a rate of 50% — higher even than that of China, where the economy is 8,000 times larger. Officials here and economic experts said they were baffled. Since then, Trump backed off — temporarily. During a monthslong pause for trade talks, the U.S. has charged a baseline 10% tariff and announced new rates for dozens of countries starting Friday. Lesotho's rate will be set at Trump's whim, with aides suggesting that tariffs charged on goods from smaller African countries could top 10%. Many nations have received letters laying out a new tariff. With the pause set to expire Friday, Lesotho officials say they've not received one and they find themselves among the countries where Trump says officials simply don't have time for one-on-one negotiations. Leaders — and the 12,000 people employed by garment factories exporting to the U.S. market — are still waiting. The damage has already rippled through Lesotho's economy, where textile manufacturing comprises the largest private industry with more than 30,000 workers in 2024. For Tzicc and its customers, the threat and apparent singling out of Lesotho were enough. Management decided to rush to deliver preexisting orders before tariffs resumed. But American buyers stopped placing new orders. With no work left, virtually all the factory's employees were sent home — potentially permanently. 'Well, unfortunately, we finished,' factory compliance manager Rahila Omar said, pointing out the irony of the strategy as she walked among rows of silenced and covered machines. 'That is why now we don't have any work.' Omar is one of a handful of employees left in the eerily quiet factory. A few remain in the accounting department; others empty leftover stock to a warehouse elsewhere. Officials and workers fear this may be a sign of what's to come for other factories in Lesotho, where poverty is widespread among the population of 2 million and most textile workers single-handedly support their families. Lesotho's tiny economy was threatened with giant tariffs In March, a month before slapping Lesotho with the 50% tariff, Trump described it as a place 'nobody has ever heard of," struggling to pronounce the nation's name in a speech criticizing U.S. foreign aid. It's true Lesotho is a 'very minuscule economy," as its own trade minister, Mokhethi Shelile, described it. But its relationship with Washington dates back decades. The U.S. was the first country to open an embassy in the capital, Maseru, after Lesotho declared independence from the United Kingdom in 1966. The military received U.S. training, and hundreds of millions in U.S. funds were sent to Lesotho to fight the HIV/AIDS epidemic via the now defunctUSAID office and the PEPFAR program. As textiles grew to become Lesotho's main export, some 75% of its product went to the U.S. Lesotho became known as Africa's denim capital. If an American purchased jeans from a U.S. brand such as Wrangler or Levi's, they may have been 'Made in Lesotho,' as tags still note. In 2000, the U.S. signed the African Growth and Opportunity Act, allowing Lesotho and other African nations to export goods to the U.S. duty free. Shelile said he was in the process of negotiating AGOA's September renewal when he was awakened in the middle of the night by texts from aides bearing news of the 50% U.S. tariffs. 'No, this cannot be real,' Shelile remembers thinking. 'What did we do to deserve this?' According to the Trump administration, Lesotho charges a 99% tariff on U.S. goods. The government here said it doesn't know how the U.S. calculated that. In theory, the tariff decision was based on trade deficit: Lesotho's exports to the U.S. were around $240 million last year — mainly clothing and diamonds — and imports from the U.S. were only $2.8 million. But in practice, the math is more complicated than that. And in reality, Lesotho simply cannot afford to import more U.S. products. Nearly half the population lives below the poverty line. 'The trade deficit that exists between Lesotho and the U.S. is a natural trade deficit that can happen when you have these types of disparities between two economies," Shelile said. "It cannot be breached and certainly cannot be breached by imposing tariffs.' Lesotho declared a state of emergency over unemployment Last year, Lesotho's overall unemployment rate was about 30%, national data shows. For those 35 and younger, it was nearly 50%. The threat of tariffs has exacerbated the national unemployment troubles, prompting the government to declare a state of disaster this month. 'No matter how we slice it, we've already had a lot of losses," Shelile said. "People have lost quite a lot money. And to claw back and come back to where we were before this is going to take time.' Most of the 12,000 people hired by Lesotho's 11 factories exporting to the U.S. are women with children to feed and school fees to pay. Of those, 9,000 jobs are directly in the line of fire and an additional 40,000 will suffer indirectly from the U.S.-imposed tariffs, Shelile said. 'We're talking people in real estate that are leasing some rooms,' he said. 'We're talking people in transport, whether it's long-distance haulage to the port, or it is a taxi driver taking people to work in the morning. They are going be affected.' Mapontso Mathunya used to work on Tzicc's cutting room floor and is now unemployed. Her husband also is out of a steady job. With two young children, Mathunya was the family's breadwinner. She now tries to sell snacks and cigarettes on the street but finds it a daily struggle to bring home even a few cents. 'Our financial burden has been heavy," she said. 'Things are bad.' The future of this factory and others remains in limbo The future of the Tzicc factory depends on what happens Friday, compliance manager Omar said. Owned by a Taiwanese national, the factory has been open since mid-1999. In a peak month, it made up to 1.5 million pieces of clothing for JCPenney. Key U.S. customers for Tzicc — JCPenney, Walmart and Costco — did not reply to AP to comment. Pivoting to the neighboring South African market, one of the solutions proposed by the trade minister and industry consultants, wouldn't be enough to even cover the employees' payroll, Omar said. And even if American buyers return, it's unlikely the factory could rehire all its 1,300 workers, she added. Today, just a few blocks away, former employees try their luck looking for work at other factories that are still operating. Most are turned away. 'Life is difficult,' former worker Mathunya said. 'There is nothing, nothing at all. People don't have money.' __ Pascalinah Kabi in Maseru, Josh Boak in Washington and Anne D'Innocenzio in New York contributed. ___ For more on Africa and development: The Associated Press receives financial support for global health and development coverage in Africa from the Gates Foundation. The AP is solely responsible for all content. Find AP's standards for working with philanthropies, a list of supporters and funded coverage areas at
Reuters
5 hours ago
- Business
- Reuters
Zambia wants to extend IMF loan programme by 12 months
LUSAKA, July 30 (Reuters) - Zambia's government wants to extend its International Monetary Fund programme another 12 months beyond its current expiry at the end of October, a cabinet statement said on Wednesday. The copper-rich Southern African nation has been trying to get its public finances back on track with IMF support after running up a huge debt pile. Its 38-month Extended Credit Facility was approved in August 2022 for an initial $1.3 billion but was later increased to $1.7 billion. So far about $1.55 billion has been disbursed. The cabinet statement said Finance Minister Situmbeko Musokotwane had been authorised to ask the IMF for the 12-month extension. "The objective is to consolidate the gains achieved during the programme period into 2026" and help support economic reforms, the statement said. A finance ministry spokesperson declined to elaborate when contacted by Reuters. Zambia defaulted on its external debt in 2020 after years of unsustainable borrowing but battled its way to a restructuring deal with its primary creditors last year. It is still seeking to agree restructuring terms with smaller creditors including Afreximbank. The IMF's board last week approved a $184 million disbursement to Zambia after completing the fifth programme review.
Al Arabiya
a day ago
- Al Arabiya
Four killed, hundreds arrested in Angola protests over fuel hike
Violent protests in Angola over a fuel price hike killed at least four people and led to hundreds of arrests, with unrest continuing in a few parts of the capital Luanda on Tuesday, police said. Monday's violence, which involved looting, acts of vandalism and clashes with police, followed a government decision early this month to increase the diesel price by one-third to ease the strain of costly fuel subsidies on public finances. Minibus taxi associations, which in turn hiked their fares by up to 50 percent, launched a three-day strike to protest the move on Monday, when the violence erupted. More than 500 people were arrested, and shops, banks, buses and private vehicles were vandalized, national police spokesperson Mateus Rodrigues told a press conference, saying there were still 'pockets of disorder' in parts of Luanda. The Southern African oil-producing country has been gradually cutting fuel subsidies since 2023, when protests over a petrol price hike also turned deadly.
Zawya
a day ago
- Zawya
Pilanesberg improves anti-poaching and conservation with Hytera's digital radio network upgrade
Game reserve radically improved communication across the park, boosting efforts to protect vulnerable wildlife and rangers Modern features enable more efficient operations Background and implementation Pilanesberg Game Reserve is home to almost all animal species native to Southern Africa, including the Big Five. The reserve has, over the years, established itself as a stronghold for rare rhino species. In the high-stakes world of protecting the wellbeing of species, game rangers and visitors, reliable communication is vital. Pilanesberg transitioned from a basic, analog two-way radio system to a state-of-the-art Digital Mobile Radio (DMR) solution by Hytera. Hytera's partner Altron Nexus (now named Sentiv after a management buyout), donated a Hytera HR106X DMR repeater and Hytera H-series DMR devices equipped with GPS tracking as well as a Hytera Smart Dispatch Plus software platform to Pilanesberg's Anti-Poaching unit, led by Field Ecologist Steve Dell. This represented a significant change because previously the reserve relied on ageing analog radios that only supported voice communication, with a single repeater resulting in limited coverage across the reserve and no advanced features. Because of the analog system and single receiver, there were parts of the park that had unreliable, or nonexistent, communication. The DMR upgrade introduced a second repeater linked via a microwave connection that has resulted in seamless, reliable, almost park-wide coverage. Key features and benefits of Hytera's H-series technology 1. Personnel Safety and Emergency Response Hytera's system enhances ranger safety with smart, automated features designed for fast incident response. Man Down Alert: Radios detect if a user has fallen or is motionless, automatically sending an emergency alert and location to the control room. Emergency Button: One-touch panic alerts with real-time location ensure immediate support. GPS Tracking: Live positioning helps teams monitor ranger movements and respond quickly when needed. Online / Offline Status so that the Control room at all times can see which user is online or offline 2. Reliable, Park-Wide Communication Extended Coverage: multi-site repeaters linked via microwave ensure near-complete coverage across rugged terrain. Digital Voice&Data: DMR technology supports clear, efficient communication. Text Messaging&Voice Recording: Enables effective coordination and post-event review. 3. Operational Insight and Security Movement Analytics: Track patrol routes, speed, and direction for incident review. Data Security: Up to 256-bit encryption protects sensitive communications. Benefits for Pilanesberg Pilanesberg is a 56,000 hectare nature reserve with mountainous areas that previously lacked any signal for communications. This means that rangers in the park conducted 24-hour security operations under harsh conditions without the security of robust communication. This presented a risk. Since adopting Hytera's DMR system, rangers have the security of a robust communication system. Hytera's DMR system has assisted field ecologists and rhino protection rangers to obtain an advantage over poachers entering the park and destroying wildlife and the country's natural habitat. 'Reliable communication is the backbone of effective conservation and anti-poaching efforts, whether it's protecting rhinos, managing fires, supporting technical teams or ensuring the safety of our staff in the field or conducting air operations. Upgrading to a digital radio network has significantly boosted our conservation operations,' says Dell. 'The park is hilly with mountains and valleys, and the digital network has ensured almost-total coverage. Very importantly, it has enabled real-time tracking. Tracking is vital – if someone is out in the field, needs assistance or cannot talk for whatever reason, the control room always has real-time visibility. Anything can happen in very remote areas. If needed, the emergency alerts result in instant support, dispatching help to exactly where the radio is located. Importantly, using the system is simple and uniform. The improved communications have significantly boosted our overall conservation efforts and operations.' Franco Stronach, Head of Indirect Channel at Hytera South Africa says Hytera defines sustainable development as a path to profitability and long-term growth. Working alongside our partner Sentiv, we have delivered a reliable, scalable system to support Pilanesberg in its conservation efforts.' He adds: 'Hytera is empowering conservationists in parks across the country, including Pilanesberg, The Kruger National Park, Timbavati Game Reserve and Sabi Sabi Private Game Reserve. It has been important for us to see beyond just the practical utility of the equipment, which in itself is world-leading. For us, the difference being made is Hytera's embodiment of social responsibility, a business priority to make a meaningful impact in a sector of the country that holds special cultural significance.' Training and after-market support Hytera understands that real, meaningful impact requires a long-term investment in the country. It conducts annual certified training sessions in South Africa, bringing in trainers to educate resellers and distributors on system configuration and support. With main distributors and hundreds of resellers, Hytera ensures widespread, localised support. Equipped with their support from Hytera, resellers provide end-user training, including operational guidance and feature demonstrations. Distributed by APO Group on behalf of Hytera. About Hytera: Hytera Communications Corporation Limited (SZSE: 002583) is a leading global provider of professional communications technologies and solutions. With voice, video and data capabilities, we provide faster, safer, and more versatile connectivity for business and mission critical users. We make the world more efficient and safer by enabling our customers to achieve more in both daily operations and emergency response. Learn more at /
Yahoo
2 days ago
- Business
- Yahoo
'How will we survive?' Lesotho factory that made Trump golf shirts hit hard by US tariffs
A garment factory in Lesotho, which has produced Trump-branded golf shirts, may have to soon shut down following the massive import taxes, or tariffs, imposed by the US government earlier this year. The small, southern African kingdom was hit with "reciprocal" tariffs of 50% - a higher rate than any other country - when they were announced by US President Donald Trump in April. Although they have since been put on hold, Trump says they will be reimposed this Friday, 1 August, along with other countries around the world, unless a separate deal is reached. "We don't know how we survive this one. We are going to die," Aletta Seleso tells the BBC in a bleak voice standing outside Precious Garments, where the Trump golf shirts have been made. The mother of one young child has worked there for almost a decade, also supporting her extended family on her monthly salary of $160 (£120). Lesotho has become known as the "denim capital of Africa". The country's garment factories also produce jeans for iconic American brands such as Levi's and Wrangler. But the uncertainty over the future of the country's clothes industry is one reason why Lesotho declared a national "state of disaster" earlier this month in order to speed up job-creation. The BBC meets Ms Seleso during her lunch break just outside Precious Garments. She joins hundreds of workers streaming out of the factory with their lunch boxes in one hand and water bottles in the other as they try to find a spot in the weak sun of the southern hemisphere winter to enjoy their home-cooked meals. Most workers, with blankets wrapped around their bodies, huddle in groups with their backs to the sun as they try to soak up a bit of warmth. She has been working at the factory as an embroiderer for the past eight years and had little reason to worry about her job - until the US tariffs announcement in April. She says workers have been told that the firm "can close any time from now". "They say it's about a tariff," she says. In the meantime, Ms Seleso and her colleagues have been told to work for two weeks a month, meaning they get just half the pay. She says it is now "so hard" for her to support her child, mother and her late younger sister's two children, who are all under her care. The BBC has approached Precious Garments for comment. But Sam Mokhele, the secretary general of one the unions representing 150 workers at the firm, says the company had not "indicated any sign of shutting down" at the moment. "But what they said was [they may have to] shut down if things do not change," he says. Ms Seleso is appealing to the government to engage with the US and try to find a viable solution to the tariff question. Despite her desperate situation, she at least still has an income – but others are not so fortunate. On the other side of town, in Maseru's Thetsane industrial site, dozens of desperate job seekers gather outside another garment factory, CGM. The factory, one half of the CGM Presitex Jeans Manufacturer, has closed but there have been rumours it may soon reopen. The would-be workers stand in small groups, clutching water bottles, their only source of sustenance for the day, as they listen and hope they will be among the lucky few. Among this group, mostly women, is Puleng Selane, who has been job-hunting since March. Since 2018, the mother of three has worked as a security guard, along with a variety of other jobs. The young woman now relies on the sale of medical face masks to support her family - which even on a good day only brings in enough money to buy maize meal and paraffin. "Now life is so hard... we often eat once a day but sometimes go to bed without any food," she says. Although the 50% tariff has been paused, Lesotho's exports to the US are still subject to a 10% tax, like the rest of the world. Until this year, its exports had not been subject to any US tariffs under the African Growth and Opportunity Act (Agoa) - a law passed in Washington in 2000 to allow duty-free access to the US for goods from some countries in order to alleviate poverty and create jobs. This was part of the "trade not aid" philosophy. Trump's tariffs could be death knell for US-Africa trade pact How jeans and diamonds pushed Lesotho to the top of Trump's tariffs list The textile and garment industry is Lesotho's largest private sector employer providing, at its peak, around 50,000 jobs, out of a population of just over two million. The figure now hovers around 36,000 according to the government, with 12,000 jobs directly affected by the US tariffs. Precious Garments at one point hired 4,000 workers. But the Lesotho textiles boom boosted by Agoa meant that it had a trade surplus with the US - exporting more than it imports from the country. And that was why Trump imposed such high tariffs on the country, which appear to have put an end to Agoa, threatening the future of the one bright spot in the country's economy. Despite the relative success of the clothes factories - until now - the country as a whole is still struggling to create enough jobs for its young population. Unemployment stands at 30% but for young people the rate is almost 50%, according to official figures. Youth activist Tšolo Thakeli tells the BBC that even without the latest threat to the textile sector, the situation is "tragic" as there are "literally no jobs in the country, especially for the youth". "We have graduates from every level... not having jobs. There's a serious state of hopelessness amongst the youth," he says. And while there are myriad reasons, Mr Thakeli blames the "nepotism [and] corruption" that many allege runs rampant in the country. The 31-year-old entrepreneur and qualified lawyer is a vocal critic of Lesotho's government and was arrested after he posted a video on social media questioning whether Prime Minister Sam Matekane's promise to create 70,000 jobs in two weeks was realistic. He tells the BBC the prime minister lacks a proper plan to tackle the crisis. "There's nothing tangible that the government has done or set to address the problem. [It's just] empty promises," he says. This is denied by Trade Minister Mokhethi Shelile, who insists that the government is working to try and resolve the issue. "We already had some solutions, even before the tariff was announced, because the US market was already beginning to be a difficult market for us," he tells the BBC. He says the country is "already shifting to production for South Africa" and that as things stand, only "20% of the garment industry supplies the US market". Mr Shelile is speaking to the BBC outside another factory hit hard by the uncertainty caused by the tariffs. TZICC, owned by a Taiwanese national, has been operational in Lesotho since 1999, producing sportswear for the likes of JC Penney, Walmart and Costco. At the height of operations, the firm produced 400,000 garments a month but when the BBC visits, hundreds of sewing machines lie gathering dust in one of the warehouses. A manager at the firm, Rahila Omar, says the company's 1,000 employees, mostly women, have been laid off for the next four months due to a halt in orders. "Because of the... pressure of the tariffs, our buyers wanted us to finish the order or the quantity as soon as we can. We were given a deadline of 30 June, but we finished before 30 June, and that's why we have a layoff," she says. Ms Omar says TZICC is waiting for an update on Agoa and whether the current tariff structure would be reviewed before deciding on the next step. Even if the current 10% tax remained, without Agoa, it would not be enough for the firm to reopen as there would be "some additional charges" to consider, she explains. And while the factory also supplies clothing to South African retailers, Ms Omar says the income generated from these pales in comparison to what the firm earns from the US market. Despite the government's assurance that it is working to resolve the issue - with the minister even promising a desperate passer-by who spotted him during our interview that "it's going to work [out] at the end of the day" - for Ms Seleso and Mr Thakeli, these are hollow words for the country's despondent and hopeless workforce. Find out more about Lesotho from the BBC: Nine things about Lesotho - the country 'nobody has ever heard of' Who benefits from Lesotho's 'white gold'? The small African country with the world's highest suicide rate Go to for more news from the African continent. Follow us on Twitter @BBCAfrica, on Facebook at BBC Africa or on Instagram at bbcafrica BBC Africa podcasts Focus on Africa This Is Africa
