By Africa Risk Control (ARC) – Lesotho, a small landlocked kingdom surrounded by South Africa, is emerging as a strategic investment destination in Southern Africa. With a population of around 2.3 million and a GDP of $2.5 billion, the country’s per capita income stands near $1,000, driven by agriculture, manufacturing, mining, and remittances.
Agriculture remains a cornerstone, employing nearly 60% of the population. Maize, wheat, and livestock are key outputs, though the sector is highly dependent on rainfall. The government’s renewed push for irrigation, agro-processing, and commercialization has opened opportunities for agribusiness partnerships, particularly in climate-smart farming.
Mining, especially diamonds, remains a vital contributor to Lesotho’s export earnings. The country’s high-altitude kimberlite pipes produce some of the world’s finest diamonds, attracting global miners like Gem Diamonds and Letšeng. However, fluctuating global prices and logistical bottlenecks require investors to factor in operational resilience.
Lesotho’s manufacturing and textile industries—supported by preferential trade agreements such as AGOA (African Growth and Opportunity Act)—employ tens of thousands, mainly women. The sector is recovering after pandemic shocks, with new investment incentives targeting value addition and export diversification.
The country’s political stability and reform agenda, along with ongoing investments in renewable energy and water projects (notably Phase II of the Lesotho Highlands Water Project), continue to strengthen investor confidence.
As Lesotho deepens regional integration with South Africa and SADC markets, opportunities in logistics, ICT, and tourism are gaining traction. However, infrastructure gaps, electricity costs, and bureaucratic delays remain challenges investors should assess carefully.
Read the full investor-focused analysis on ARC website for deeper insights and due diligence guidance on Lesotho’s investment landscape.
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