Lesotho Faces Potential Unemployment Crisis Following US Aid Cuts, Warns Economist

Lesotho is likely to face its highest unemployment rate ever due to the recent decision by the US President to cut off aid to several countries, including South Africa. This warning comes from local economist Mr. Moeti Mothibeli, who expressed concern about the far-reaching consequences of this move for Lesotho’s economy.

In an interview, Mr. Mothibeli explained that if the US does not reverse its decision, unemployment in Lesotho could soar. He pointed out that Lesotho relies heavily on South Africa for trade, employment, and various forms of economic support. With South Africa’s economy set to take a significant hit from the reduction in US aid, Lesotho’s economy, which is closely intertwined with its neighbor, will likely suffer as well.

A key point raised by Mr. Mothibeli is the impact on Basotho workers employed in projects and organizations funded by the US, both in Lesotho and South Africa. Many Basotho workers rely on these funds for their livelihoods, and with the expected closure of such projects, jobs will be lost. “Without these funds, many of the ongoing projects will close, and workers will lose their jobs,” he said, emphasizing the gravity of the situation.

Furthermore, Mr. Mothibeli highlighted the ripple effect the aid cuts will have on informal employment in Lesotho. Many Basotho people work as domestic workers in South Africa, and if businesses and households there face layoffs or retrenchments due to the aid cuts, domestic workers will also lose their jobs. Informal employment in South Africa has long been an important source of income for many families in Lesotho, and any disruption in this sector will worsen the unemployment crisis.

In conclusion, Mr. Mothibeli cautioned that the aid cuts could have a devastating impact on the already fragile economy of Lesotho, leading to widespread job losses and a sharp rise in unemployment. He called for urgent action to mitigate these effects and emphasized the need for alternative strategies to support the workforce during this challenging time.