Lesotho gives up on its garment industry

Lesotho’s garment
industry may be on
its way out, putting at
risk a key customer for
road freight transport
operators into and out of
the country. With no rail
service and minimal air
freight movement in the
country, factory inputs and
exported finished products
have moved primarily by
road since the US African
Growth and Opportunity
Act created the nation’s
textile industry.
Agoa gives Lesotho’s
exports preferential access
to the American market
and led to extensive
manufacturing investment
in the country by Asian
firms. But Agoa is set
to expire in 2015, and
with the Lesotho product
deemed uncompetitive in
other markets, government
is looking to other
industries for economic
development.
All raw materials that go
into garment-making are
imported, and government
does not support the
creation of local firms to
produce these inputs. A
World Bank official in
Lesotho was quoted in the
press saying government
had “given up” on the
garment industry, and
would eliminate subsidies.
“We need to diversify
away from textiles into
other areas,” said Lesotho
PM Pakalita Mosisili
earlier this year.
Agriculture, horticulture,
water management and
tourism are four
industries that government
is interested in
supporting to replace the
garment industry.