As Lesotho grapples with the implications of a 90-day suspension of the proposed 50% U.S. tariffs—among the highest in Africa—Prime Minister Samuel Matekane has called for removing barriers to American investment, notably championing Elon Musk’s Starlink.
Speaking at the Third Public-Private Dialogue National Conference on April 9 in Maseru, Matekane said licensing Starlink was key to attracting U.S. investors. Critics, however, argue that the Starlink debate should be separated from the tariff issue, citing national interest concerns over the satellite company’s 100% foreign ownership.
The Lesotho Communications Authority confirmed that Starlink submitted a license application in February, which has since faced local resistance. During public consultations, stakeholders such as Vodacom Lesotho and advocacy group Section Two insisted that Starlink establish local shareholding before operating in the country.
They referenced Econet and Vodacom Lesotho as existing models of balancing foreign investment with national control, emphasizing the need for transparency and fairness in the licensing process.Analysts warn that approving Starlink’s license could complicate Lesotho’s diplomatic ties with South Africa, which previously rejected Starlink over similar ownership issues.
Such a move may also heighten competition for South Africa’s Vodacom, which owns 80% of Vodacom Lesotho. While Lesotho seeks to use market access as a bargaining chip for better U.S. trade terms, observers note that trade decisions, especially under the Trump administration, often hinge on broader geopolitical dynamics rather than goodwill alone.
Lesotho’s economy, largely export-driven and dependent on AGOA benefits, faces a precarious future. The textile sector, responsible for $240 million in annual exports to the U.S., supports over 12,000 jobs. A permanent 50% tariff could devastate this sector. While the U.S. is a critical market, Lesotho’s largest trade partner remains South Africa, receiving $351 million in textiles and diamonds in 2023. Trade Minister Mokhethi Shelile expressed doubt over the 90-day reprieve, pointing to challenges in securing negotiations with Washington.