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Sky News
2 days ago
- Business
- Sky News
Lesotho: In the country that Trump claims 'nobody has ever heard of', his name evokes fear and panic
A blanket of thick fog covers Lesotho's capital, Maseru. Winter in the southern African country feels colder than ever. Thousands of garment workers have lost their jobs as the threat of US tariffs brings the textile industry to the edge. Hundreds of thousands have been cut off from critical healthcare after the USAID withdrawal. Unemployed women stand outside the locked gates of factories asking for work. HIV-positive mothers travel long distances to clinics for a limited supply of life-saving medicine, holding their babies wrapped in blankets. Lives and livelihoods in Lesotho have been devastated by US President Donald Trump - a country he has said "nobody has ever heard of". The Basotho have certainly heard of President Trump. His name now evokes fear, worry and panic among many in the small nation his policies have targeted. "People are scared of him, too much. When he says he will do something then he must do it," says Maplape Makhele, a 32-year-old garment worker and mother of two. "I have seen what he has done in South Africa and China. He doesn't want to work with other countries." We spoke to Mpalape at her work station in the Afri-Expo Textiles factory while she sewed denim. This work was steady while Lesotho held the title of the "denim capital of Africa". Today, she is terrified of losing her job as the breadwinner of her family. More than 200 of her colleagues have already been laid off from the factory. "We are close to only half operational," says her boss Teboho Kobeli, the managing director of Afri-Expo Textiles Factories. He has cut around 500 jobs across three factories. "We had been doing some US orders but now we have had to re-adjust ourselves," he says. "There are a lot of job losses and I can see more jobs lost as of next month." Lesotho has declared a state of national disaster over high youth unemployment and job losses linked to US tariffs and aid cuts that will last until June 2027. President Trump is expected to finalise tariffs on several countries including Lesotho and South Africa on August 1. In Lesotho, people are hoping for tariffs on the lower end at 10% but are preparing for a hit as high as 50%. Any export duties will have an impact on industry here which has benefitted from 25 years of the Africa Growth and Opportunity Act (AGOA) duty-free trade agreement with the US. "That is multilateralism - to trade with one another and leverage on each other's strengths," Lesotho's minister of trade and industry Mokhethi Shelile tells us. "We did not think an economy so advanced, the pioneer of multilateralism, to renege and turn back on that very principle that has made it so big. "We are done talking [with the US]. We are waiting for a response, for a final solution from them. We are told it will come soon but we don't know how soon." We interviewed the minister at a celebration launching a government-sponsored factory expansion in Lesotho's second city Maputsoe. The factory is only 5km from the border gate into South Africa, its main export destination. Unemployed garment workers are huddled around the locked gates hoping to appeal to the trade minister for jobs. Inside the warehouse, women furiously produced clothing for the South African market. Minister Shelile tells us that this regional trade is part of Lesotho's solution but economists believe it is another dead end. "I don't think South Africa is an option for us given the problems that South Africa is going through itself," says economist and former minister of mining Lebohang Thotanyana. "South Africa has been hit by tariffs and is going to lose around half a million jobs as a result of the Trump effect. "Some of those jobs on the citrus farms and automobile industry in South Africa were held by Basotho so it means they will be directly affected there as well." Trade unionists in Lesotho's capital Maseru have been speaking to laid off workers to explain the context of the devastating job cuts. "It's really hard for them because what the people want is the job," says Ts'epang Nyaka-Nyaka, general secretary of the Economic Freedom Trade Union. He is expecting his own wife to potentially lose her job at a factory exporting to American denim brand Levis. The two-thousand-member union is rapidly shrinking as more lay-offs are announced. "They want the job - not the politics," he says.
IOL News
24-07-2025
- Business
- IOL News
South Africa continues to press the US for trade deal, says Parks Tau
File photo ofTrade, Industry and Competition Minister Parks Tau. Image: GCIS South Africa continued to work tirelessly discussing with its counterparts in the US to keep the trade route open and having submitted the Framework Deal in May, South Africa has signed a condition precedent document with the office of the US Trade Representative, a precursor to finalisation of the negotiations, Minister of Trade, Industry and Competition Parks Tau said in his budget vote. Tau said the collective work of business, organised labour and civil society, in engaging the US Congress is also a key lever in South Africa's toolkit in its approach to ensuring the continued inclusion of South Africa in the Africa Growth and Opportunity Act and to respond to the recently proposed US-South Africa Bilateral Relations Review Act. "Our active engagements with Asia are significantly bearing fruit. We have advanced conversations with China on Green Industrialisation and deepening our industrial supply chains. We have also committed to working with them to beneficiate our critical minerals here at source. This will unlock value in our Special Economic Zones (SEZs) and Industrial Parks as we agree that these dynamic strategic nodes in our country are best placed to drive our reindustrialisation agenda." Tau said. He said the government was also reinvigorating its relationship with Japan through InvestSA and the Japan External Trade Organisation (JETRO). As the looming Carbon Border Adjustment Mechanism (CBAM) alone has the potential to create an almost 1% contraction in GDP on the African continent, South Africa remains firm that the multilateral trading system with the World Trade Organisation and the United Nations at their core, must be preserved until all member states are able to reach their developmental goals, he said. "This is the message we will take to the 14th Ministerial Conference in Cameroon next year. Our announcement on the Clean Trade and Investment Partnership (CTIP) with the EU in March, is to be welcomed by our provinces and municipalities. For one, CTIP will enable us to execute our decarbonisation agenda and maximise the R90 billion facilitation funding that has been initially committed," Tau said. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. 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Advertisement Next Stay Close ✕ Ad loading Deputy Minister for the Department of Trade, Industry (Dtic) and Competition Zuko Godlimpi said to support and accelerate the participation of black industrialist in the economy, the Industrial Development Corporation (IDC) had in 2025/2026 revised its commitment to a total of R12 billion towards transformation focused funding. Godlimpi said R7.4bn was earmarked for black industrialists, R3.5bn for women-owned businesses and R1.5bn for youth-led enterprises in efforts aspired to reflect a deliberate strategy to transform the ownership and control of productive assets in the economy. "In KwaZulu-Natal, the IDC is supporting SME canegrowers and supporting avocado producers link to export markets. In the North West, a second round of funding is being prepared for black grain producers. In the Eastern Cape we are advancing green hydrogen and agro processing through partnership with local industry to respond better to global market conditions," Godlimpi said. He said other highlights included that in the Free State there was a programme of revitalising the agri infrastructure with the provincial government, in Gauteng through supplier development, business referrals are fueling a strong pipeline for transformative funding, whilst in the Western Cape, there was support for black industrialists in poultry, plastics and solar installations. "In Limpopo, we have a proposed R50 million farming aggregator funding, which is expected to create 400 jobs. In Mpumalanga, the IDC is backing green hydrogen and biofuels brick making and furniture making, with plans afoot for the establishment of a Special Economic Zone," Godlimpi said. He said on the part of the Dtic, out of its R11bn, up from R9.6bn in the 2024/2025 year, 35.15% of the total budget goes to business incentives while infrastructure investments are apportioned 10.2% amounting to R5.2bn investment in the incentive programme. BUSINESS REPORT
IOL News
08-07-2025
- Business
- IOL News
US tariffs threaten South Africa's economic growth and job market
US President Donald Trump's import tariffs will have a severe impact on the number of vehicles that South Africa exports to the US.. Image: Freepik High tariffs imposed by the US on South African exports from August 1 will be a blow that will further de-industrialise South Africa, kill economic growth, and cause further unemployment, Efficient Group chief economist Dawie Roodt said yesterday. Speaking in an online discussion held by the Motor Industry Staff Association of South Africa (MISA) about the US's plans to resume its threat of 30% import tariffs for South African goods, Roodt said the tariffs will result in lower investment into South Africa and will impact manufacturing and agriculture particularly, sectors that are among the most capable of growing job opportunities in the country. He said while South Africa's participation in the US's Africa Growth and Opportunity Act (Agoa) later this year was not formally over and uncertain - Agoa allows duty-free access to the US market for eligible sub-Saharan countries - the new tariffs effectively meant this prospect was unlikely, as the new tariff structure could not co-exist with the benefits of Agoa. In addition, Agoa had the protection of property ownership rights as a condition of membership, which South Africa could not meet due to its Land Expropriation Act. South Africa was viewed as a medium-income country, and the Act was for less developed economies. 'We need to accept that Agoa is dead,' he said. He said, however, that by appearances, US President Donald Trump's door was always open for further negotiation on the tariffs, but that the US appears to be seeking political concessions from the South African government. These likely included changing its outlook on BEE, on land expropriation, and on Israel and Iran, with much of the government's current views on these matters based on 'political grandstanding,' said Roodt. He said that South African exporters should seek to diversify their markets from the US, and there was growth and potential in China, India, Europe, and Eastern European markets, but there would also now be greater competition in these markets, as many other countries were now also working to diversify their markets from the US. The government had earlier this month sought to allay fears that the tariffs would be imposed, such as on July 1, when Trade, Industry and Competition Minister Parks Tau said that there was 'still room for engagement' with the US. South Africa is one of 14 countries arbitrarily targeted under this tariff policy. The US is South Africa's second-largest export market after China, with R157 billion worth of goods exported in 2024, mainly precious metals, vehicles, iron and steel, and aluminium. Over 25 000 vehicles were shipped to the US last year. FedEx Sub-Saharan African Operations MD Gregory Saffy said one promising avenue to diversify trade is the African Continental Free Trade Area (AfCFTA). 'The agreement represents one of the most important levers for driving inclusive growth and unlocking the continent's full trade potential. Of course, this won't happen overnight, but we're optimistic given the early progress being reported,' he said. Since the start of preferential trade under AfCFTA in January 2024, South Africa's exports had steadily increased, reaching some R820 million by March 2025. These included mining equipment, household appliances, plastics, apparel, food items, and electrical machinery. Professor Raymond Parsons of the NWU Business School said: 'South Africa is not without remedies. It remains essential that bilateral negotiations must continue to stabilise and consolidate future US-South Africa investment and trade relations. Collaboration between government and the private sector must continue to accelerate the steady identification of alternative markets, for which South Africa must remain globally competitive,' Parsons said. He said the costs of doing business in South Africa is still too high, and growth-friendly policies must be implemented. 'It becomes even more essential to speedily implement growth-friendly policies that build economic buffers and reduce costs in ways that also enable South Africa to successfully deal with any global setbacks,' he said. The US is the third-largest destination for South African automotive exports, with about R35bn worth of vehicles shipped in 2024, accounting for 6.5% of total vehicle exports in 2024. National Association of Automobile Manufacturers of South Africa (Naamsa) CEO Mike Mabasa said they were meeting with the motor manufacturers to get their inputs on the new tariff regime. However, in April, Naamsa said the proposed tariff increase will severely impact local manufacturers operating in South Africa, including BMW, Ford, Isuzu, Mercedes-Benz, Nissan, Toyota, and Volkswagen, who produce vehicles for global markets, including the US. The US move could have serious implications for jobs and investment in South Africa's automotive sector. 'The proposed tariff costs cannot be absorbed by manufacturers, resulting in additional costs for US consumers and a reduced choice of South African-produced brands,' Naamsa said.
Eyewitness News
08-07-2025
- Business
- Eyewitness News
Steenhuisen gravely concerned about impact of US 30% tariff import on country's exports
Lindsay Dentlinger 8 July 2025 | 10:00 Department of Agriculture Tariffs Donald Trump Agriculture Minister John Steenhuisen delivering his budget vote address in the Good Hope Chamber of Parliament on 8 July 2025. Picture: Parliament/Phando Jikelo CAPE TOWN - Agriculture Minister, John Steenhuisen, says he's gravely concerned about the impact that the United States' (US's) 30% tariff import increase will have on the country's exports. He said the announcement by US President Donald Trump on Monday almost certainly spells the end of the Africa Growth and Opportunity Act (AGOA) under which the country has, until now, enjoyed duty-free exports to the US for over 6,000 products. READ: Trump set to impose 30% tariff on all SA goods Delivering his budget speech in Parliament on Tuesday, Steenhuisen, however, said there's still time for the government to negotiate a more favourable deal before the first of August implementation date. Steenhuisen said the agriculture sector is particularly exposed in the areas of citrus, wine, nuts and table grapes. 'Now more than ever, it highlights the need for urgent reform in South Africa so that we can ensure that our economy can meet the requirement of our trading partners around the world, and I look forward to working with Minister [Parks] Tau and others in the coming weeks to urgently seek a way through this impasse, and to ensure we can avoid the 30% tariff for our agriculture sector.'
BBC News
12-06-2025
- Business
- BBC News
China ready to drop all tariffs on African imports
China say dem don ready to drop di tariffs dem dey charge on imports from all 53 African kontris wey dem get diplomatic relations wit. Di move wey dem announce for one China-Africa co-operation meeting, dey come as di continent dey face di possibility of increased tariffs on dia products wey dey enta US. China na Africa largest trading partner – one position dem don hold for di last 15 years – as Africa dey export goods wey worth around $170bn (£125bn) go di Asian nation for 2023. One joint ministerial statement bin criticise "certain kontris' [effort to] scata di existing international economic and trade order" through di unilateral imposition of tariffs. China ask US to resolve trade disputes on di basis of "equality, respect and mutual benefit". Di zero-tariff move, wen dem implement am, go be extension of one deal dem make last year for China to drop tariffs on goods from 33 African nations wey dey classified as "least developed". Di expanded list go include some of China largest trading partners on di continent, wey include South Africa and Nigeria. China neva tok wen di go come into effect. Eswatini na di only African state dem exclude from di zero-tariff announcement as dem recognise Taiwan as independent kontri, whereas China see am as breakaway province. China currently dey import plenty raw materials from Africa, most especially from di Democratic Republic of Congo and Guinea. For April, President Donald Trump bin raise concern among US trading partners wen e announce high tariffs on dia imports from many kontris, wey include 50% rate for Lesotho, 30% for South Africa and 14% for Nigeria. Di US bin pause di implementation until next month, although di temporary pause fit dey extended further for countries wey dey negotiate "in good faith", according to US Treasury Secretary Scott Bessent. For 2024, di US import $39.5bn-worth of goods from Africa. Dem carry out di importation under di zero-tariff deal wey dey known as di Africa Growth and Opportunity Act (Agoa), wey now look like say dey under threat if Trump administration go ahead wit di imposition of fresh charges.
