TRALAC - Trade Law Centre

AGOA boosts Lesotho's textile exports to US by 50%, but...

Tuesday, 18 March 2003

Source: Business Report

Maseru - Textile exports from Lesotho to the US have jumped 50 percent in 2001/02 because of a new trade act, a US International Trade Commission report said last week.

However, a Lesotho trade union alleged that the increase was partly due to the exploitation of textile workers.

The African Growth and Opportunity Act (Agoa) was designed to improve access to US markets by African exporters.

According to the report, Lesotho's textile exports to the US rose to just over 300 000 tons in 2001/02 from 200 000 tons the previous year and the textile industry is now the country's biggest employer, with more than 40 000 workers.

Agoa provides increased access to the US market for apparel and textile products as well as a wide range of other goods.

However, a report from the Lesotho Clothing and Allied Workers' Union said that textile factories often ignored Lesotho's labour laws.

The union report cited arbitrary dismissals and the refusal of many companies to recognise trade unions.

It also alleged that employees were often required to work overtime to meet company production targets. Failure to do so could see a cut in wages.

"This growth must, however, be seen against the backdrop of the appaling working conditions in the textile industry, characterised by poor wages and unduly long working hours," said Daniel Maraisane, a shop steward at Reflex Knitwear, one of the factories designed for Agoa exports.

"I have worked a 12-hour day ever since I joined this company two years ago, although I only get paid for eight hours," said Elizabeth Mochesane, a machine operator at a Precious Garments factory.

Lesotho is one of 35 countries whose exports have grown considerably under Agoa.

Africa earned $8.4 billion in the first 11 months of 2001 because of Agoa.

Foreign investors receive incentives from the Lesotho government, including a six-year tax holiday.

While on a visit to Africa in February to explore the possibility of a free trade pact, US trade representative Robert Zoellick said Lesotho attracted foreign investment of $120 million in a year because of Agoa - four times the amount of foreign aid Lesotho receives annually.