ECONOMICS

Main Crops: Wheat, corn, sorghum, soybean, sugar beets.

Natural Resources: Lead, Zinc, Tin, Copper, Iron, Petroleum.

Major Industries: Food Processing, Motor Vehicles, Consumer Durables.

Small, mountainous, and completely landlocked by South Africa, Lesotho depends on a narrow economic base of textile manufacturing, agriculture, remittances, and regional customs revenue. About three-fourths of the people live in rural areas and engage in animal herding and subsistence agriculture, although Lesotho produces less than 20% of the nation's demand for food. Agriculture is vulnerable to weather and climate variability.

 

Lesotho relies on South Africa for much of its economic activity; Lesotho imports 85% of the goods it consumes from South Africa, including most agricultural inputs. Households depend heavily on remittances from family members working in South Africa in mines, on farms, and as domestic workers, though mining employment has declined substantially since the 1990s. Lesotho is a member of the Southern Africa Customs Union (SACU), and revenues from SACU accounted for roughly 26% of total GDP in 2016; however, SACU revenues are volatile and expected to decline over the next 5 years. Lesotho also gains royalties from the South African Government for water transferred to South Africa from a dam and reservoir system in Lesotho. However, the government continues to strengthen its tax system to reduce dependency on customs duties and other transfers.

 

The government maintains a large presence in the economy - government consumption accounted for about 26% of GDP in 2017. The government remains Lesotho's largest employer; in 2016, the government wage bill rose to 23% of GDP – the largest in Sub-Saharan Africa. Lesotho's largest private employer is the textile and garment industry - approximately 36,000 Basotho, mainly women, work in factories producing garments for export to South Africa and the US. Diamond mining in Lesotho has grown in recent years and accounted for nearly 35% of total exports in 2015. Lesotho managed steady GDP growth at an average of 4.5% from 2010 to 2014, dropping to about 2.5% in 2015-16, but poverty remains widespread around 57% of the total population.

 

 

	1990	2000	2010	2020
GNI, Atlas method (current US$) (billions)	0.93	1.19	2.54	2.59
GNI per capita, Atlas method (current US$)	550	580	1,270	1,210
GNI, PPP (current international $) (billions)	2.22	3.25	5.52	6.14
GNI per capita, PPP (current international $)	1,300	1,600	2,770	2,870
GDP (current US$) (billions)	0.6	0.89	2.23	2.25
GDP growth (annual %)	6	3.9	5.3	-7.6
Inflation, GDP deflator (annual %)	12	6.3	5.3	13.1
Agriculture, forestry, and fishing, value added (% of GDP)	12	8	5	5
Industry (including construction), value added (% of GDP)	21	35	31	35
Exports of goods and services (% of GDP)	..	..	42	40
Imports of goods and services (% of GDP)	..	..	108	88
Gross capital formation (% of GDP)	..	..	31	30
Revenue, excluding grants (% of GDP)	34.5	29.4	41.3	23.2
Net lending (+) / net borrowing (-) (% of GDP)	10.7	-1	-3.1	-23.9
States and markets
Time required to start a business (days)	..	138	39	15
Domestic credit provided by financial sector (% of GDP)	..	..	..	..
Tax revenue (% of GDP)	27.8	22.9	30.3	18.3
Military expenditure (% of GDP)	3.6	3.3	2.8	1.6
Mobile cellular subscriptions (per 100 people)	0	1.1	49.5	72.9
Individuals using the Internet (% of population)	0	0.2	3.9	43
High-technology exports (% of manufactured exports)	..	..	..	0
Statistical Capacity Score (Overall Average) (scale 0 - 100)	..	..	66	68
Global links
Merchandise trade (% of GDP)	123	116	142	120
Net barter terms of trade index (2000 = 100)	100	100	78	79
External debt stocks, total (DOD, current US$) (millions)	396	770	788	1,052
Total debt service (% of exports of goods, services and primary income)	4.2	7.5	2.1	5.2
Net migration (thousands)	-8	-161	-48	-50
Personal remittances, received (current US$) (millions)	999	478	610	471
Foreign direct investment, net inflows (BoP, current US$) (millions)	16	32	10	30
Net official development assistance received (current US$) (millions)	139.1	37.2	256	170.5
Electric power consumption (kWh per capita)	3,397	2,082	3,230	..