LESOTHO: Efforts to reopen textile factories underway

[ This report does not necessarily reflect the views of the United Nations]

JOHANNESBURG, 28 Jan 2005 (IRIN) - At least one of the six clothing and textile factories in Lesotho which closed down in December 2004, is expected to reopen early next month, a senior government official told IRIN this week.

About 7,000 clothing and textile workers' jobs were under a cloud when the factories, some of them believed to be facing "cash-flow problems", failed to reopen early this year.

"We are also trying to help at least another two factories - in the form of export incentives - to reopen next month as well," said David Rantekoa, permanent secretary for trade and industry.

The government hopes to save at least 5,000 jobs if the three factories become operational again. The factory set to open next month will provide 500-600 jobs, while the other two employed 1,200 and 3,300 workers respectively.

The tiny mountain kingdom of Lesotho is dependant on the largely Asian-owned textile and clothing industry. According to the Lesotho Clothing and Allied Workers Union (LECAWU), the industry employs 56,000 workers.

Labane Chokobane, an economist at the University of Lesotho, commented: "The textile and clothing industry, which comprises more than 500 companies, is the mainstay of the country's industrial development.

"The industry, which contributed 10.51 percent in 2003 towards Lesotho's GDP [Gross Domestic Product], is also the country's biggest foreign exchange earner. The closure of companies in the industry, which is the country's biggest employer, will impact on foreign earnings and will drastically affect the balance of payments," he added.

According to LECAWU's deputy general-secretary, B. Shaw Lebakae, the end of quotas for cheap imports to the United States from Asian countries would cause more foreign factory owners to consider relocating their businesses from Lesotho.

The foreign-owned firms originally set up shop in the country to take advantage of its preferential access to the US market.

While the government estimates that half the country's two million population live in poverty, independent studies say more than 70 percent of Basotho are unemployed.

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