The Minister of Trade, Industry, and Business Development, Mokhethi Shelile, has announced plans to engage in urgent discussions with U.S. officials following the recent imposition of a 50 percent tariff on Lesotho imports, effective from this month.
Speaking to journalists in Maseru last night flanked by Foreign Affairs Minister Lejone Mpotjoane and Finance Minister Dr Retšelisitsoe Matlanyane, Shelile emphasised the importance of these talks to reaffirm the strong trade relations between Lesotho and the United States.
“We are preparing for an urgent meeting with our U.S. counterparts to address the two tariffs imposed— the baseline tariff of 10%, which will take effect on April 5, 2025, and the reciprocal 40% tariff, effective on April 9, 2025,” Shelile explained.
Earlier in the day, Shelile and his team met with the U.S. Embassy in Lesotho’s Charge d’Affaires a.i. Thomas Hines to seek guidance on how to approach the negotiations.
“The U.S. government wants Lesotho to have a more solid fiscal position, one that is less reliant on imports,” Shelile said.
“Currently, we have spent USD 240 million on imported materials this year, which significantly exceeds what we receive in returns from the U.S. In their calculations, 99% of the tariffs reflect Lesotho’s exports to the U.S., compared to only 1% of U.S. exports to Lesotho. By dividing this figure in half, they arrived at the decision to impose a 50% tariff on our goods.”
Shelile noted that the tariff hike comes at a crucial time, as Lesotho prepares to enter negotiations with the U.S. government regarding the renewal of the African Growth and Opportunity Act (AGOA), which is set to expire in September 2025.
“The majority of our exports to the U.S. are textile products, motor vehicle seats, and trout, though they don’t directly reach the U.S. market. The textile sector, in particular, is crucial, with 11 firms directly supplying the U.S. market through AGOA, employing over 12,000 Basotho, the majority of whom are women,” Shelile emphasised.
“This tariff increase threatens jobs, and if it continues, we face a significant challenge in protecting our workforce.”
In announcing the tariff on Lesotho imports this week, the U.S. President Donald Trump said:
“I have signed the reciprocal tariffs order that means, they do it to us, and we do it to them. It is a declaration of economic independence, for years hardworking Americans were forced to seat on the side-lines as other nations got and powerful much of it at our expense but now it is our turn to prosper and in so doing, the trillions and trillions of dollars to reduce our taxes and pay our national debt and it will happen real quickly. If you want your tariff rate to be 0%, build your product or plant here in America.”
Earlier in the week, Shelile had underscored the vital role AGOA has played in Lesotho’s economic growth, particularly in the textile sector. He reflected on the history of AGOA’s impact.
“In 2000, before AGOA’s launch, employment in the apparel sector stood at 19,000. By 2003, thanks to AGOA, that number skyrocketed to over 30,000. For the first time in Lesotho’s history, more people were employed in the private sector than in the public sector, marking a transformative shift in our economic landscape.”
The extension of AGOA, first renewed in 2015, is set to expire on September 25, 2025.
“The consequences of not renewing AGOA would be disastrous. Currently, 11 companies in Lesotho are directly servicing the U.S. market, employing over 12,000 Basotho. If AGOA is not extended, these jobs could disappear, and the ripple effects would extend to other sectors, including the taxi industry, real estate, and retail businesses.”
In response to recent market challenges, Lesotho has been working to diversify its markets, particularly focusing on Southern Africa, where there is a growing demand for locally sourced products, similar to trends in the U.S.
“All textile factories that have opened or expanded since September 2024 are now servicing the South African market. We are encouraging this through Supply Chain Financing, which allows us to process orders for South African retailers. While this is a step in the right direction, it is still not enough to tackle the unemployment challenges we face,” the Minister explained.
The government is also focusing on expanding into other sectors beyond textiles. Shelile pointed to the Belo industrial estate in Botha-Bothe as an example of new opportunities.
“The estate has been successful, with all 51,000 square meters now available for lease. We expect this to create up to 7,000 new jobs in the coming year,” he said, noting that the projects being planned range from automotive manufacturing to the production of electric scooters.
“The livelihoods of 12,000 Basotho are at stake. We cannot afford to lose these jobs, and we must continue fighting for the renewal of AGOA to protect our people and our economy,” Shelile stated.
Seabata Mahao is a general news reporter with special focus on Business and Sports.
Started working at Newsday in 2021.
has an Associate Degree in Journalism and Media.
