Lesotho Textile Sector Faces Collapse Despite Tariff Cut
Nation’s Key Industry Still Struggles Against Competitors
MASERU, Lesotho — Lesotho’s vital textile industry is grappling with severe challenges, including widespread factory closures and job losses, despite a reduction in threatened U.S. export tariffs. Officials expressed concern that the eased but still substantial tariffs leave the sector at a significant competitive disadvantage.
Tariff Reduction Offers Limited Solace
The Trump administration had previously announced a steep 50% tariff on imports from Lesotho, the highest globally. While this rate has since been reduced to 15%, the initial announcement sent shockwaves through the industry. The textile sector is Lesotho’s largest private employer, supporting over 30,000 jobs, with approximately 12,000 directly tied to exporting apparel to U.S. retailers like Levi’s and Wrangler.
A recent report highlighted the dire situation for garment manufacturers. Clothing producer Tzicc, which exports sportswear to American stores including JCPenney, Walmart, and Costco, has experienced a dramatic downturn in business. The company has sent home most of its 1,300 workers in anticipation of the tariff increases.
Competitors Enjoy Favorable Rates
David Chen, chairperson of the Lesotho Textile Exporters, stated that the revised U.S. tariff offers minimal relief. He explained that competitors, such as Kenya, face significantly lower tariffs of 10%, making it difficult for Lesotho’s businesses to compete on an equal footing.
“As a result, many factories will have to shut down,” said Chen. “They had already been forced to lay off workers when the tariffs were first announced in April.”
—David Chen, Chairperson of the Lesotho Textile Exporters
According to the Office of the U.S. Trade Representative, bilateral trade between the U.S. and Lesotho reached $240.1 million in 2024. While clothing is a major export, Lesotho also trades in diamonds and other goods.
Government Pushes for Further Reductions
Lesotho’s Minister of Trade, Industry and Business Development, Mokhethi Shelile, confirmed that discussions with U.S. trade representatives led to the tariff reduction. However, he stressed that further decreases are necessary for the sector’s viability.
“We remain committed to pushing for a further reduction to the minimum tariff level of 10 percent, which is essential for our textile sector to compete effectively in the US market,” he said. “I have already communicated with the U.S. Embassy regarding continued negotiations.”
—Mokhethi Shelile, Minister of Trade, Industry and Business Development, Lesotho
The economic strain on Lesotho is significant, with nearly half of its 2.3 million citizens living in poverty and a quarter facing unemployment. The nation is classified as a lower-middle-income country by the World Bank.
Regional Trade Also Impacted
Lesotho’s neighbor, South Africa, is also contending with new U.S. trade policies. President Trump’s announcement of a reciprocal 30% tariff on South African goods is expected to heavily impact its agriculture and manufacturing sectors, illustrating a broader trend of challenging trade conditions for southern African nations.
In 2023, U.S. imports from Bangladesh’s textile sector, a key competitor, faced tariffs averaging around 10-15%, demonstrating the ongoing gap Lesotho must overcome.