26 September 2023

Supporting Lesotho to stand independent, but not isolated, in trade

by Farai Samhungu Peter Donelan / in Impact story

Lesotho Impact Story. Explore more impact stories here.


  • The Enhanced Integrated Framework (EIF) has strengthened institutions and catalysed economic diversification, improving productive capacities of smallholder horticulture producers to boost their trade potential. These initiatives put horticulture on the map; with a highly concentrated economy and trade profile, horticulture provides much‑needed diversification.
  • The EIF supported the introduction of greenhouse farming technology to smallholder horticultural farmers and with the technical support by the International Trade Centre (ITC) helped the Government of Lesotho to establish its first major market center for fresh fruits and vegetables in the capital Maseru. 
  • The EIF is contributing to the reduction of poverty and unemployment, as women and youth are direct beneficiaries of its initiatives.
  • The EIF has helped the Government build a conducive trade environment and negotiate access to new markets for products and services from Lesotho.

The Kingdom of Lesotho is diversifying its economy from a heavy reliance on the textiles and clothing industry through the development of, and investment in, the untapped horticulture sector, particularly production of deciduous fruits on a commercial scale. This followed recommendations from the Diagnostic Trade Integration Study (DTIS) Update in 2012 that identified the need for strengthening export and institutional capacities; increasing trade integration; improving the business environment; improving infrastructure; and ultimately, reducing poverty.

Agriculture is the source of livelihood for 80% of people living in rural areas in Lesotho. Most smallholder farmers live in lowlands and foothills, where land is arable. However, farmers are now increasingly being affected by negative climate change events, such as a dryer climate and excessive rainfalls and hailstorms that damage crops. However, through the EIF support, many smallholder farmers were able to weather the storm brought about by these negative climate change effects, since they are planting under protected conditions through the introduction of greenhouse technology. According to Phera Lepati, EIF Coordinator and Director of Planning in the Ministry of Trade and Industry (MTI), 

EIF support to farmers goes beyond improving the quality of their produce, which now meets international standards, but they have also been capacitated in marketing and business management of their enterprises.

The greenhouse technology also provides more efficient water and fertilizer use, extends the growing season and protects crops from extreme weather events.

From 2013 to 2016, a total of 572 smallholder farmers in the horticulture sector benefitted from 115 greenhouses introduced in five districts, namely Botha-Bothe, Leribe, Berea, Maseru and Mafeteng, through the Horticultural Productivity and Trade Development project, implemented by ITC in close collaboration with the Government of Lesotho. Smallholder farmers, who previously experienced crop failures, can now grow crops all year round: this has significantly improved the quality of their produce and allowed them to penetrate new and lucrative domestic and international markets. 

Smallholder farmers have expanded their businesses, created employment for many in their communities, grown their incomes and alleviated poverty. Supporting productive capacity and the quality of horticulture produce in Lesotho is directly in line with the Government's vision of horticulture exports being at the heart of poverty reduction and employment generation. The EIF funded the development of the Lesotho National Export Strategy (2021‑2025), which was formulated with technical expertise from ITC and focuses on three priority sectors with high potential for export growth – horticulture; textiles and apparel; and light industry. 

The greenhouse technology sparked the interest of women and youth, resulting in a major shift in a sector that is male-dominated. As part of its policy, the Government specifically targeted both women and young people, ensuring that at least 25% of the greenhouses benefited these marginalized groups. According to Mahlape Qoane, the former Project Manager for the Horticultural Productivity and Trade Development project in the MTI, which was implemented in collaboration with the Ministry of Agriculture and Food Security (MAFS), 

Although uptake was slow, more women and youth were motivated to engage in greenhouse farming and are now owners of thriving horticulture businesses.

Women farmers like Matiti Kabi of Sekamaneng outside of the capital city Maseru are now supplying hotels and restaurants in Maseru with fresh produce. Kabi reported that her business was a source of employment for her community. It is evident that the support provided to smallholder farmers is helping the poor make more money. Beneficiary families reported a reduction in poverty at the household level and reduced unemployment among young people. 

Supporting investments in infrastructure and people

The EIF supported the Government of Lesotho in the development of both the visible infrastructure required for improved trade and the "soft" processes needed for them to function effectively. The Lesotho National Development Corporation (LNDC), a parastatal entity under the MTI, facilitated the establishment in May 2021 of the private sector-managed Maluti Fresh Produce Market Centre to provide a facility for buyers and farmers. To assist the Market Centre to operate efficiently, the EIF funded the training of 16 professional marketing agents by the Agricultural Produce Agents Council of South Africa. At the launch of the Market Centre, Dr Moeketsi Majoro, then Prime Minister, highlighted that it marked a step forward on Lesotho's path to food production self-sufficiency, by fostering links between farmers and consumers. More than 200 farmers are registered to trade at the Market Centre, with 37 men, 16 women and 19 youths, who benefitted from the EIF-supported greenhouse initiative, supplying their produce to the Market Centre. 

This Centre is set to grow as more farmers are registering their enterprises and eager to sell their produce to the Market Centre, whereby their products will be bought by the formal retail outlets, thus sourcing locally produced products instead of importing from South Africa.

Support to Lesotho's horticulture sector has also strengthened linkages between rural smallholder farmers and the private sector, allowing farmers to produce, distribute and improve the export potential of their products. As farmers expand their activities and income, they can now afford to buy their own greenhouses. The opening by the LNDC of a canning factory in Maseru reduced the risk of post-harvest loss for perishable produce due to market and transport constraints. The cannery, with a capacity to employ 200 people, is now producing products for export to countries in the European Union (EU). Lesotho's eligibility for the benefits of the African Growth and Opportunity Act and its participation in an Economic Partnership Agreement means that it has tariff-free access to the world's biggest markets in the United States of America and the EU for its canned products. 

Supporting synergies

The EIF programme also contributed to ensuring that trade was integrated into the country's national development strategies and plans. With project activities aligned to national priorities, the EIF's support has contributed towards achieving multiple Sustainable Development Goals (SDGs) towards poverty alleviation (SDG1); food security (SDG2); gender equality (SDG5); decent work and economic growth (SDG8); and sustainable partnerships (SDG17).

Regarding sustaining results beyond the lifespan of a project, there has been a focus on supporting existing institutions, private sector players and groups representing smallholder farmer groups. This promotes broader support by pulling together much‑needed expertise to strengthen the capacity of institutions that represent producers and promoting local ownership of projects. The ultimate goal is to ensure sustainability beyond EIF support, such as the private sector uptake of the Market Centre. Additional benefits include cost-sharing; for example, both the Government of Lesotho and the EIF collaborated on initiatives to strengthen linkages between buyers and sellers, each playing to their comparative advantage. The EIF also leveraged its partnerships with the World Bank, the UN Development Programme and the UN Conference on Trade and Development (UNCTAD) with a track record of implementing trade-related projects in Lesotho. The initial DTIS, which analysed target sectors for trade development and formulated a comprehensive action plan, brought together multiple partners, the Government and non-governmental organizations to prioritize interventions.

Following the 2012 update of the DTIS, the Government of Lesotho expanded its productive base to focus on exports beyond textiles and apparel, with the emphasis on horticulture and light manufacturing. Following the success of Lesotho's horticulture projects, the World Bank deepened its support to the DTIS findings and financed both the Smallholder Agricultural Development Project and the Commercial Fruits Production under the Private Sector Competitiveness and Economic Diversification Project to scale up deciduous fruits farming, enabling smallholder farmers to obtain the certification that is necessary to export their fruits. 

The EIF also supported MTI officials to actively participate in trade negotiations within, amongst others, the Southern African Customs Union (SACU) and the Southern African Development Community (SADC), to identify and carve out a niche for trade and effective trade partnerships in the region.

Building the capacity of national institutions and helping governments to develop policies and export strategies are at the core of EIF's support to the least developed countries. In 2017, the Government of Lesotho established the Lesotho Coordinating Committee on Trade to harmonize trade policy formulation and implementation to effectively participate in international trade. The eTrade Readiness Assessment, funded by the EIF and implemented by UNCTAD, also highlighted opportunities for digital trade to contribute to trade growth and economic development as the country diversifies. The EIF also funded the development of the National Export Strategy (2021-2025), developed with technical support from ITC to address impediments to the expansion of trade. The National Export Strategy lays the groundwork for priority focus areas to be addressed by the Government and partners and for future programmes. 

While the EIF has currently completed all its projects in Lesotho, the positive outcomes of its support leave in place solid foundations to bolster trade in the country. These include the mainstreaming of EIF-supported activities into the plans of the MTI and the MAFS; skills development for both private and public officers; wide-ranging trade negotiations in the SACU; contributions to the SADC's Industrialisation Roadmap; and the continuation of trade negotiations under the Agreement establishing the African Continental Free Trade Area.


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As the second phase of the Enhanced Integrated Framework (EIF) comes to an end in 2024, the objective is to produce a catalogue of impact stories showcasing the efforts of the EIF partnership in the least developed countries (LDCs) and recently graduated LDCs where it has been actively engaged. This impact story makes up one of the stories in the catalogue. Essential input and reviews were received from the country‑based EIF National Implementation Units (NIUs) and the wider EIF team. 

The primary objective of each impact story, as well as the entire catalogue, is to adopt a journalistic approach in recounting the EIF's engagement in the LDCs during both Phase One and Two. The aim is to offer valuable insights and to document outcomes and impacts, as well as some lessons learned from the work of the EIF partnership in the LDCs. These stories do not provide a comprehensive overview of every aspect of EIF partnership engagement such as precise timelines or the exact extent of involvement (i.e., financial contributions). Instead, they serve as one of several means of information about the work of the EIF partnership. Interested readers are encouraged to supplement these impact stories by consulting other sources, including EIF Annual Reports, Trade for Development News articles, EIF social media channels, and, where applicable, the NIUs in the LDCs as well as the EIF Executive Secretariat.

It is essential to acknowledge that the information provided is neither exhaustive (e.g., it is based on the latest available data at the time of writing in 2023) nor evaluative in nature. 

Lastly, while each impact story adheres to a similar structure, the diverse range of countries, contexts, and EIF engagements means that each story is unique.

Any views and opinions expressed on Trade for Development News are those of the author(s), and do not necessarily reflect those of EIF.