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Lesotho’s trade deficit widens

Business

Staff Reporters

The year 2023 has proven to be a tough foreign trading year for Lesotho as the gap between its total value of imports and exports widened drastically.  

Data from the Bureau of Statistics (BOS) shows that Lesotho imported about M32 billion worth of goods and services, while it managed to export about M15 billion in goods and services in 2023. This reflects a trade deficit of about M17 billion, the largest since 2019.

A country has a trade deficit if its imports are more than its exports, while the opposite scenario is a trade surplus. Balance of trade refers to the difference between a country’s imports and exports.

“Figure 1 shows Balance of Trade for the period 2019 to 2023. The lowest trade deficit was observed in 2020 and the highest trade deficit recorded in 2023,” BOS said in its annual foreign trade statistics report of 2023.

The report analysed Lesotho’s foreign trade position as follow: “Lesotho depends more on foreign goods. This is justified by the fact that the imports always dominate exports, resulting in a negative balance of trade.

“In 2023 the most imported commodities in Standard International Trade Classification categories (SITCs) were ‘Machinery and transport equipment’ (M6 786.6 million) followed by ‘Manufactured goods classified chiefly by material’ and ‘Food and live animals’ with M6 199.7 million and M6 052.2 million respectively.”

South Africa, China, Taiwan and India are among Lesotho’s top partners for importing, while South Africa, Belgium and the United States are Lesotho’s top trading partners for export.

“Lesotho imports most of its commodities from South Africa (79.5 percent of the total imports value). The ‘Miscellaneous Manufactured Articles’ (SITC8) and ‘Manufactured Goods’ (SITC6) were the most exported categories in 2023; specifically, Clothes and footwear (42.9 percent) and Diamonds (23.8 percent). Lesotho’s top exports trading partners in 2023 were South Africa (M8 110 million), Belgium (M3 619 million) and USA (M2 895) million as shown by value they contributed for exports as compared to other countries.”

 Meanwhile, the value of diamonds exported from Lesotho increased to 23.8 percent of the country’s total exports value in 2023 as the value of clothing and footwear dropped to 42.9 percent. In 2022, the diamond exports amounted to 19.1 percent of the country’s total export value, while clothing and footwear stood at 47.4 percent of the total exports.

“… it is observed that ‘Clothing and Footwear’ contributed the highest share of exports (42.9 percent) followed by ‘Diamonds’ with 23.8 percent. ‘Motor Vehicles’ and ‘Plastic and articles thereof’ contributed the least to the top ten exported commodities with 0.6 percent each.”

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