Lesotho - Economic sectors

Lesotho's principle economic sectors are agriculture (18 percent), mining and manufacturing (38 percent), and retail /tourism/services (44 percent) in 1999, according to the CIA World Factbook. Although politically autonomous, Lesotho's economy is almost totally dependent on trade and cooperative development with the Republic of South Africa. Several reasons explain this dependence. First, South Africa completely surrounds

mountainous Lesotho in the same manner that water surrounds an island. Thus, all commerce and travelers to and from Lesotho must pass through their wealthier neighbor which is also their dominant trading partner. Second, 75 percent of Lesotho families rely on wages earned in South African mines for at least some of their income. Any fluctuation in mine productivity affects Lesotho. Finally, political changes in South Africa greatly alter foreign aid and investment in Lesotho. In the past, the international donor community (wealthy industrialized nations) viewed this small mountain kingdom as an island of racial freedom surrounded by a South Africa locked in apartheid. When Nelson Mandela spearheaded majority rule, South Africa became a more important recipient of international development dollars.