Fashion
How US tariffs rattled Lesotho’s apparel sector
Lesotho’s manufacturing sector has long been regarded as one of its most promising economic pillars, with textiles and apparel leading the charge. Alongside industries like footwear, food, and beverages, textiles have emerged as the dominant force—providing jobs, foreign exchange, and a sense of industrial identity for the small, landlocked southern African nation.
Lesotho’s manufacturing sector, led by textiles and apparel, has been a major economic driver, creating thousands of jobs and generating substantial export earnings, making it a top garment exporter in Sub-Saharan Africa.
However, the US tariff of 50 per cent, which was eventually lowered to 15 per cent after a 90-day pause, triggered mass order cancellations and widespread layoffs.
Over the past two decades, Lesotho has carved out a niche for itself in the realm of garment manufacturing and export, thanks in large part to the African Growth and Opportunity Act (AGOA). The trade deal granted duty-free access to US markets for eligible Sub-Saharan African countries, and Lesotho made the most of it.
By 2024, Lesotho had become the second-largest exporter by value under AGOA and the third largest by volume, almost entirely driven by its textile and garment shipments, as per reports, which added that the industry racked up $237.3 million in exports to the United States that year, a remarkable figure for a nation of just over two million people.
Thousands of workers, most of them women, found stable employment in the sector, stitching garments destined for shelves across America. For a while, Lesotho’s economic narrative was one of steady progress and global integration.
But that story took a jarring turn after US President Donald Trump slapped a staggering 50 per cent tariff on Lesotho’s exports, only to reduce it to 15 per cent after a 90-day pause. But the looming threat of a 50 per cent tariff after the expiry of the 90 days sent shockwaves through the country’s economy, particularly its textile sector, as widespread uncertainty and concern gripped one of Sub-Saharan Africa’s top garment exporters.
Spooked by the looming threat of steep tariffs, American importers had already begun cancelling orders en masse, wary of escalating costs and growing uncertainty. Factory floors, once buzzing with activity, fell silent. The very lifeblood of Lesotho’s manufacturing sector began to drain away.
Layoffs followed, disproportionately affecting women who formed the backbone of the workforce, and the crisis escalated so quickly that the government was forced to declare a two-year state of disaster, citing a dramatic surge in unemployment over the country’s “high rates of youth unemployment and job losses” amidst uncertainty over US tariffs. For many families, livelihoods that had taken years to build disappeared almost overnight.
Although following the 90-day pause and considerable backlash, Trump eventually set the tariff at 15 per cent, it came too late for many businesses that had already borne the worst of the impact. Adding to the complexity, some neighbouring countries, considered Lesotho’s competitors, were offered tariffs lower than 15 per cent.
Trade Minister of the country did not mince words when he addressed this issue.
Interacting with the media, the minister reportedly underlined that the 15 per cent tariff for the textile industry was as good as 50 per cent, as he highlighted the impossibility of competing with regional players like Kenya and Eswatini, who continue to enjoy a lower 10 per cent tariff.
“Those are our direct competition,” the minister reportedly claimed, capturing the sense of frustration that has gripped the sector.
In global trade, where the difference of a few percentage points can determine profitability, even a marginal tariff can mean the loss of business to more cost-effective alternatives. What this episode lays bare is just how vulnerable smaller economies are to shifts in global policy, especially when their fortunes are tied so heavily to a single export market.
Fibre2Fashion News Desk (DR)
The facility will process natural fibres such as abaca, banana and pineapple into high-quality yarn, addressing long-standing challenges faced by local weavers who have relied on imported materials. This initiative is expected to create new markets for agricultural produce while providing additional income streams for farmers.
The DOST-PTRI, with DOST Region 12, will establish the Regional Yarn Production and Innovation Center in Philippine’s Cotabato to process natural fibres into yarn and support Mindanao’s textile industry.
The facility aims to boost farmer incomes, reduce reliance on imported yarn and strengthen local weaving communities through training, technology transfer and improved supply chain infrastructure.
During the first-quarter meeting of the Regional Research, Development, and Innovation Committee, Evangeline Flor P. Manalang, chief science research specialist of DOST-PTRI’s Technical Services Division, stated “The RYPIC will serve as a key facility to process our natural fibers into yarn and open opportunities for skills training among farmers and local stakeholders.” She also emphasised the project’s role in building a sustainable textile ecosystem in Soccsksargen.
The RYPIC complements existing facilities such as the Natural Textile Fiber Innovation Hub at Sultan Kudarat State University and forms part of broader national programmes including the Clothing and Textile Research Innovation and Investment Agenda (CATRINA) and the FRONTIER initiative. These efforts aim to strengthen the domestic textile value chain, reduce reliance on imports and support the government’s push to expand Telang Pinoy, as highlighted by President Ferdinand R. Marcos Jr. in his fourth State of the Nation Address.
Fibre2Fashion News Desk (JP)
International markets remained a key growth driver, with revenue rising 22 per cent, while the Americas saw a marginal 1 per cent decline. Comparable sales increased 2 per cent overall, with a 15 per cent rise internationally offset by a 3 per cent decline in the Americas.
Lululemon has reported revenue of $11.1 billion in FY25, up 5 per cent YoY, driven by 22 per cent international growth despite weak Americas sales.
Margins and profits declined, with EPS falling to $13.26.
The company expanded stores and repurchased shares.
Q4 showed modest growth but weaker profitability.
Lululemon expects FY26 revenue growth of 2-4 per cent amid ongoing macroeconomic challenges.
The gross profit remained flat at $6.3 billion, while gross margin contracted by 260 basis points to 56.6 per cent. Income from operations declined 12 per cent to $2.2 billion, with operating margin narrowing to 19.9 per cent. Diluted earnings per share (EPS) fell to $13.26 from $14.64 in FY24, Lululemon Athletica said in a press release.
The company continued to invest in expansion and shareholder returns, opening 44 net new stores to reach a total of 811 locations and repurchasing 5 million shares worth $1.2 billion. Lululemon ended the year with $1.8 billion in cash and cash equivalents, while inventories rose 18 per cent to $1.7 billion.
Andre Maestrini, interim co-CEO, president, and chief commercial officer at the company, stated, “Throughout 2025, we reported double-digit revenue growth in our international business and are taking action to incorporate learnings from across our regions to drive forward our strategies. Our teams are energised by the initial response to our recent product launches and continue to deliver successful guest activations globally. Looking ahead, we are encouraged by our opportunities in North America and around the world and are grateful to our teams for their commitment to delivering the products and experiences our guests love.”
In the fourth quarter (Q4) of FY25, revenue increased 1 per cent to $3.6 billion, with international growth of 17 per cent offsetting a 4 per cent decline in the Americas. However, profitability weakened, with operating income falling 22 per cent and gross margin declining by 550 basis points to 54.9 per cent. Quarterly diluted EPS dropped to $5.01 from $6.14.
Meghan Frank, interim co-CEO and chief financial officer at Lululemon, stated, “We are pleased to achieve fourth quarter revenue and EPS results ahead of our expectations. As we begin our new fiscal year, we are focused on executing on our action plan, offering new and differentiated products to our guests, and elevating their experiences with lululemon. Driving improvement in our full-price sales over the course of 2026 is also a key priority, particularly in North America, and will enable us to enhance our brand health and deliver long-term growth and value creation for shareholders.”
Looking ahead, Lululemon expects first-quarter FY26 revenue between $2.4 billion and $2.43 billion, with full-year revenue projected at $11.35 billion to $11.5 billion, representing growth of 2 per cent to 4 per cent. Diluted EPS is forecast in the range of $12.1 to $12.3 for FY26, as the company navigates macroeconomic uncertainties and evolving market conditions.
Fibre2Fashion News Desk (SG)
China’s shipment of garments and accessories increased **.* per cent year on year to $**.*** billion from $**.*** billion, driven by steady demand from key markets such as the US and EU, where retailers have begun restocking after cautious inventory management in ****. Meanwhile, exports of textile products, including yarns, fabrics and related articles, rose at a faster pace of **.* per cent to $**.*** billion from $**.*** billion, supported by stronger downstream manufacturing activity across Asia and improved order flows from emerging sourcing hubs.
In February **** alone, exports of textile yarns, fabrics and related articles were valued at $**.*** billion, while garment shipments stood at $**.*** billion, taking the combined monthly total to $**.*** billion. The relatively balanced contribution of textiles and apparel highlights a synchronised recovery across the value chain, from raw materials to finished goods.
Lady Amelia Windsor shares private hen photos tied to grandparents’ love story
Sri Lanka increases fuel prices around 25% as Middle East tensions disrupt global oil supplies – The Times of India
Princess Eugenie husband springs in action for Fergie, Andrew: ‘Unexpected’
Tips and Advice for Buying Used or Refurbished Electronics
UAE savings strategies 2026 explained: Best apps, tools, budget rules and smart money hacks to beat rising cost of living in emirates – The Times of India
Iran threatens US-linked oil facilities after Kharg Island bombed
-
Tech1 week agoTips and Advice for Buying Used or Refurbished Electronics
-
Business1 week ago
UAE savings strategies 2026 explained: Best apps, tools, budget rules and smart money hacks to beat rising cost of living in emirates – The Times of India
-
Politics1 week agoIran threatens US-linked oil facilities after Kharg Island bombed
-
Sports1 week agoJapan suffers shocking collapse to Venezuela in World Baseball Classic
-
Entertainment7 days agoStrategic oil stocks to be released ‘immediately’ in Asia and Oceania: IEA
-
Entertainment1 week agoIran at war
-
Tech1 week agoApple’s New Monitor Does HDR Like It’s Never Been Done Before
-
Politics1 week agoHow can US get out of Iran war?