Lesotho among nations set for US tariff talks

As SACU stands its ground, call for fair trade

RETHABILE MOHONO and

BOKANG MOSHOESHOE

MASERU – Lesotho is among the 20 countries selected for trade negotiations with the United States, following the punitive tariffs imposed by the Trump administration earlier this year.

The development, first reported by privately-owned American media company, Bloomberg, offers a glimmer of hope for Lesotho’s embattled export sector.

The announcement follows weeks of strained diplomatic efforts.

Last month, trade minister, Mokhethi Shelile, expressed frustration at the difficulty of securing an audience with the relevant officials from the US Trade Department.

The ministry confirmed that a delegation, led by Shelile, returned from Pretoria empty-handed after failing to meet with US trade experts.

When asked for an update, Shelile declined to comment. “We are busy with discussions and it’s not the right time to talk to the media as yet. You will be appraised once we are at a comfortable position,” he said.

However, local media reports indicated that Shelile has since confirmed negotiations will take place, though dates are yet to be finalized.

Initially, the Trump administration imposed a staggering 90 percent tariff on Lesotho’s exports, shocking local exporters and threatening thousands of jobs, particularly in the textile sector.

Amid mounting criticism, the US partially rolled back the tariffs to 30 percent, offering Lesotho a 90-day window review for negotiations.

According to sources quoted by Bloomberg, “The group includes nations such as Japan, South Korea and Vietnam, all top sources of US imports where Trump wants to shrink the trade deficit. It also encompasses comparatively minor partners like Fiji, Lesotho and Mauritius…”

Lesotho has long sought to engage with the US to present its case for a better trade arrangement.

Shelile confirmed that 11 factories currently export goods to the US, employing around 12 000 Basotho. Data from the Competitiveness and Financial Inclusion (CAFI) project shows that women and girls make up 83 percent of the factory workforce, underscoring the social impact of the tariffs.

The World Bank recently reported that Lesotho’s export-driven sectors, including textiles and mining, have suffered from weak foreign demand and low commodity prices. Unemployment and poverty levels remain high, making trade access vital for the economy.

In light of these challenges, Shelile last month during the press conference stressed the importance of finding alternative markets.

“We cannot rely solely on the US market. South Africa, for example, is boosting local procurement and aims to source 80 percent of its goods domestically. Lesotho must explore more opportunities within the Southern African Customs Union (SACU) and the broader region,” he said.

While diplomatic channels remain open, the tariffs have already inflicted damage. Over 12 000 textile jobs are at risk, with factories in areas like Ha Thetsane feeling the strain.

The sudden trade penalties coincided with Lesotho’s efforts to renew its eligibility under the African Growth and Opportunity Act (AGOA), a crucial framework that had allowed duty-free exports to the US for over two decades.

President Donald Trump defended the tariffs, citing a 99 percent trade imbalance with Lesotho. Lesotho exports approximately USD 240 million worth of goods to the US annually, while US exports to Lesotho are valued at just USD 3 million.

“This 99 percent trade deficit led to the 50 percent tariff decision under what is being called a reciprocal tariff model,” Shelile explained.

“We understand the rationale, but we believe diplomacy and mutual interest should prevail.”

In a partial reprieve, Trump announced a 90-day pause on further tariff increases for countries that had not retaliated. “In the spirit of fair trade and cooperation, I’m authorizing a 90-day pause on new tariffs for nations that have not retaliated,” he said via Truth Social. The baseline 10 percent tariff remains in effect during this negotiation window.

The 90-day period was later adjusted with another 30 days.

Minister of Foreign Affairs and International Relations, Lejone Mpotjoane, during the same gathering sought to reassure the public, emphasizing that Lesotho’s ties with the US remain strong.

“The 99 percent trade imbalance is not a sign of broken relations. The US is prioritizing its own economic agenda, and we must adapt strategically,” he said.

Minister of Finance and Development Planning, Dr Retšelisitsoe Matlanyane, urged calm, advising against panic as negotiations proceed. The government had previously engaged with the US Embassy for guidance on addressing the tariff situation.

Political leaders at home have not spared criticism. All Basotho Convention leader, Nkaku Kabi, recently tabled a motion in Parliament to discuss the tariffs’ impact, though the debate was disrupted by a lack of quorum.

Kabi criticized the government’s failure to secure an earlier review and called for proactive solutions. Also Basotho National Party leader, Machesetsa Mofomobe, echoed these sentiments, urging the government to present concrete measures and decrying the absence of key ministers during vital discussions.

Meanwhile, the Southern African Customs Union (SACU) has raised serious concerns about unimaginable trade tariffs introduced by the United States, saying these measures could harm the economies of southern Africa and weaken global trade rules.

SACU is made up of Botswana, eSwatini, Lesotho, Namibia, and South Africa.

In a strong statement released after a meeting of SACU ministers, the group criticized the US for imposing new tariffs on imported goods. These tariffs, introduced on April 9 were set at different rates for different countries.

However, following criticism from several trade partners, the US temporarily replaced them with a universal 10 percent tariff for a 90-day review period. Despite this pause, SACU says the damage and uncertainty caused are already being felt.

Concerns about Unilateral Action, SACU says that the US acted without consulting its trade partners, including developing countries like those in southern Africa.

According to the group, such unilateral decisions go against the spirit of international trade agreements. These agreements are meant to ensure that all countries big and small have a fair chance in global markets.

SACU pointed out that the US has been one of the region’s most important trade partners for many years. Through programmes like the AGOA, the Generalized System of Preferences (GSP), and the Most Favoured Nation (MFN) principle, many goods from SACU countries have been able to enter the US market without tariffs.

This access has helped create jobs, attract investment, and reduce poverty in the region.

But with the new tariffs, SACU fears that this progress could be undone. The ministers said the new US trade policy could hurt local industries, make SACU exports more expensive, and discourage investment.

As a call for fair treatment in its statement, SACU urged the US government to reconsider its approach. The group asked the US to continue giving special trade benefits to Least Developed Countries (LDCs) and AGOA-eligible nations like those in southern Africa. They explained that these benefits are important for encouraging economic growth and development in poorer regions.

SACU also highlighted the need to fix problems within the World Trade Organization (WTO). They said that while the WTO plays a key role in global trade, it needs reforms to better support industrial development in Africa and to make global trade rules more balanced and fair.

The SACU Ministers said they remain committed to building strong industries within their own region. They warned that the US tariffs could disrupt local manufacturing and make it harder for African countries to trade with one another under the African Continental Free Trade Area (AfCFTA).

Moreover, to avoid trade actions that would interfere with SACU’s common external tariff or undermine efforts to build regional value chains especially in important industries like clothing, textiles, and automotive manufacturing they called on the US.

SACU sees AfCFTA as key to Africa’s future and it is working hard to finalize trade rules among African countries.

Despite their frustrations, SACU Ministers said they are open to finding solutions with the US, they invited its government to sit down for talks and work together on trade policies that benefit both sides. They emphasized that strong, fair, and cooperative trade relationships are better for long-term economic growth and stability.

In conclusion, SACU’s message was clear: Unilateral trade moves like the recent US tariffs are harmful, not just to southern Africa, but to the global trading system. But rather than escalate tensions, SACU is asking for calm, dialogue, and a renewed commitment to fair and inclusive trade.

The statement was signed by Ericah B Shafudah, chairperson of the SACU Council of Ministers. It ends with a warning against protectionism and call for cooperation, showing that SACU wants to protect its economies but also wants to work with the world, not against it.