Lesotho is one of the world's least developed countries.
Although only about 10 percent of the country's area is
suitable for permanent agriculture, the majority of the
labor force is employed in this industry. The main food
crops are maize, sorghum, wheat, potatoes and beans. Tobacco
is the most important export commodity from agriculture.
Livestock management also plays an important role and
exports of wool and mohair.
The most important industries are diamond mining and the
textile industry, but the latter was hit hard by the
financial crisis of 2008–09 and has had difficulty coping
with competition from Asia. Tourism has become increasingly
important from the income and employment point of view and,
after transfers from migrant workers, is the second largest
source of so-called invisible income. The country's most
important natural resource is water, and projects for
hydropower development are underway. Lesotho already
produces more electricity than the country disposes of (only
a small proportion of households have access to electricity)
and electricity is exported to South Africa. In 1988, an
agreement was signed with South Africa (Highland Water
Scheme), which means that water from rivers in Lesotho is
diverted to South Africa.
countryaah, Lesotho has a large deficit in its trade balance.
Transfers, mainly from Lesothians in South Africa, have long
outweighed the deficit, but since the mid-1990s, South
African mines have reduced the workforce and many Lesothians
have been forced to return. Imports are dominated by food
and live cattle, machinery and transport equipment and
petroleum products. Exports are dominated by textile and
leather products, water, water energy and diamonds. Dominant
trading partners are South Africa and the United States.
Membership in the Customs Union SACU (Southern African
Customs Union) contributes greatly to the country's income.