…temporarily saves over 12k textile jobs in Lesotho
Mathatisi Sebusi / Mohloai Mpesi
The government can heave a sigh of relief for now after the United States government suspended the steep tariffs it had imposed across its trade partners including Lesotho which had been slapped with a massive 50 percent tax.
US President, Donald Trump, yesterday announced a 90-day suspension of the tariffs to allow affected countries, including Lesotho, to negotiate their positions. However, the 10 percent baseline tariff remains in effect.
The government has welcomed the suspension, saying it provides an opportunity to negotiate for a permanent reduction or total elimination of the tariffs.
The suspension has also temporarily saved over 12 000 textile jobs as around 15 factories which export to the US were facing closure. They could no longer compete with those from other countries such as Kenya and Eswatini which had been slapped with only 10 percent tariffs by Mr Trump.
Mr Trump said he had suspended the tariffs to grant over 75 countries a waiver to negotiate their tariffs with the US government.
“…Based on the fact that more than 75 countries have contacted representatives of the United States—including the Departments of Commerce, Treasury, and the United States Trade Representative—to negotiate a solution to the subjects being discussed, including trade, trade barriers, tariffs, currency manipulation, and non-monetary tariffs, and that these countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90-day pause, and a substantially lowered reciprocal tariff during this period, of 10 percent, also effective immediately.”
This excludes China which he said had shown “lack of respect to world markets” and therefore slapped it with 125 percent tariffs.
Minister of Trade, Industry and Business Development, Mokhethi Shelile, welcomed the waiver, saying it provides room for negotiation.
“We have not really discussed it because it has just come up.
This is the second time this week there has been a pause, and the White House denied claims that it was fake news. So, there are two possibilities: it could be true or not.
But let us assume it’s true—I have always said the 10 percent baseline, when applied to all countries, is acceptable. We can compete under those terms, there is no problem with that.
“The problem arises when countries like Eswatini are charged 10 percent while we’re charged 50 percent. We compete with those countries, and this makes our goods expensive.
But regardless, we will not stop working hard to break away from this problem. It is too serious. Whatever we are doing, you will see in the coming days or weeks—buyers from South Africa are coming to engage with our people here.
“We are unleashing the potential of our local market to absorb all the orders from elsewhere (other than the US) eventually. Our plan to break away does not stop. We will continue, and their market (the US) will become a bonus.”
Deputy President of the Lesotho Textile Exporters Association (LTEA), Ricky Chang, had told the Lesotho Times yesterday that some factories had already been asked by American buyers to suspend April shipments due to the new tariffs.
The new tariffs replaced the zero-tariff advantage Lesotho previously enjoyed under the African Growth and Opportunity Act (AGOA), which had been in place since 2000 but was effectively repealed by the new US measures.
Mr Chang urged the government to act swiftly and intensify negotiations with the US to either reduce or eliminate the tariffs, to help Lesotho stay competitive in global trade.
In a separate interview with the Lesotho Times, Mr Shelile said the government was awaiting a response from the US following a formal request for a meeting.
(SEE Q&A on Page 10)
The post Trump suspends 50% tariffs appeared first on Lesotho Times.