Lesotho, a small but economically strategic nation in Southern Africa, has declared a state of economic emergency after being hit with a 50% import tariff by the United States—one of the highest imposed under President Trump’s new “reciprocal tariffs” regime. The decision threatens to derail the country’s two most vital industries: textiles and diamonds.
The U.S. has been a major trade partner for Lesotho, accounting for more than 10% of the country’s total annual income.
In 2024, Lesotho exported $237.3 million worth of goods to the U.S., while importing just $2.8 million in return. That trade imbalance was used to justify the high tariff, which is already sending shockwaves through Lesotho’s economy.
The textile industry, which produces jeans and garments for major U.S. brands such as Levi’s and Wrangler, employs tens of thousands of workers in Lesotho and makes up nearly three-quarters of the country’s exports to the United States. With the new tariff, the cost of these goods will rise significantly for U.S. buyers, threatening demand and putting thousands of jobs at risk.
Access to the U.S. market through AGOA allowed Lesotho to build a thriving textile industry, creating around 40,000 jobs, most of them held by women. Garments accounted for nearly 90% of Lesotho’s manufacturing exports, and about a tenth of its entire $2 billion GDP, according to global research firm Oxford Economics.
And it’s not just textiles. Lesotho’s raw diamond industry, a vital source of foreign exchange and government revenue, is also at risk. Lesotho is home to some of the world’s highest-elevation diamond mines, including the Letšeng Diamond Mine, located more than 3,000 meters (nearly 10,000 feet) above sea level. This unique geological setting has proven to be rich in large and high-quality stones. However, the high tariff could force U.S. diamond buyers to look elsewhere, further shrinking Lesotho’s already limited export market.
Lesotho was originally included among the first 15 countries slated for virtual negotiations with the U.S. to discuss the tariffs when they were announced in March 2025. However, those talks never took place as planned. In his April State of the Union address to Congress, President Trump briefly mentioned Lesotho, referring to it as a country “no one has ever heard of” while discussing government spending. Despite Lesotho’s ongoing efforts, direct communication with the Trump administration remains elusive.
Despite the damaging U.S. tariffs, Lesotho is working to diversify its economy and reduce reliance on American exports. The government has launched a plan to create 60,000 jobs over two years in sectors like construction and agriculture, using emergency funds redirected from ministry budgets. At the same time, Lesotho is exploring new trade partnerships with South Africa, the EU, and countries within the African Continental Free Trade Area. Officials are also engaging diplomatically with U.S. trade representatives, challenging the tariff rates and pushing for a fairer deal.
