Page last updated on February 08, 2019

Economy - overview:
Small, mountainous, and completely landlocked by South Africa, Lesotho depends on a narrow economic base of textile manufacturing, agriculture, remittances, and regional customs revenue. About three-fourths of the people live in rural areas and engage in animal herding and subsistence agriculture, although Lesotho produces less than 20% of the nation's demand for food. Agriculture is vulnerable to weather and climate variability.

Lesotho relies on South Africa for much of its economic activity; Lesotho imports 85% of the goods it consumes from South Africa, including most agricultural inputs. Households depend heavily on remittances from family members working in South Africa in mines, on farms, and as domestic workers, though mining employment has declined substantially since the 1990s. Lesotho is a member of the Southern Africa Customs Union (SACU), and revenues from SACU accounted for roughly 26% of total GDP in 2016; however, SACU revenues are volatile and expected to decline over the next 5 years. Lesotho also gains royalties from the South African Government for water transferred to South Africa from a dam and reservoir system in Lesotho. However, the government continues to strengthen its tax system to reduce dependency on customs duties and other transfers.

The government maintains a large presence in the economy - government consumption accounted for about 26% of GDP in 2017. The government remains Lesotho's largest employer; in 2016, the government wage bill rose to 23% of GDP – the largest in sub-Saharan Africa. Lesotho's largest private employer is the textile and garment industry - approximately 36,000 Basotho, mainly women, work in factories producing garments for export to South Africa and the US. Diamond mining in Lesotho has grown in recent years and accounted for nearly 35% of total exports in 2015. Lesotho managed steady GDP growth at an average of 4.5% from 2010 to 2014, dropping to about 2.5% in 2015-16, but poverty remains widespread around 57% of the total population.

GDP (purchasing power parity):
$6.656 billion (2017 est.)
$6.762 billion (2016 est.)
$6.561 billion (2015 est.)
note: data are in 2017 dollars
country comparison to the world: 170
[see also: GDP country ranks ]

GDP (official exchange rate):
$2.749 billion (2017 est.)
[see also: GDP (official exchange rate) country ranks ]

GDP - real growth rate:
-1.6% (2017 est.)
3.1% (2016 est.)
2.5% (2015 est.)
country comparison to the world: 205
[see also: GDP - real growth rate country ranks ]

GDP - per capita (PPP):
$3,300 (2017 est.)
$3,400 (2016 est.)
$3,300 (2015 est.)
note: data are in 2017 dollars
country comparison to the world: 190
[see also: GDP - per capita country ranks ]

Gross national saving:
20.3% of GDP (2017 est.)
19.7% of GDP (2016 est.)
24.7% of GDP (2015 est.)
country comparison to the world: 96
[see also: Gross national saving country ranks ]

GDP - composition, by end use:
household consumption: 69.2% (2017 est.)
[see also: GDP - composition, by end use - household consumption country ranks ]
government consumption: 26.4% (2017 est.)
[see also: GDP - composition, by end use - government consumption country ranks ]
investment in fixed capital: 31.4% (2017 est.)
[see also: GDP - composition, by end use - investment in fixed capital country ranks ]
investment in inventories: -13.4% (2017 est.)
[see also: GDP - composition, by end use - investment in inventories country ranks ]
exports of goods and services: 40.8% (2017 est.)
[see also: GDP - composition, by end use - exports of goods and services country ranks ]
imports of goods and services: -54.4% (2017 est.)
[see also: GDP - composition, by end use - imports of goods and services country ranks ]

GDP - composition, by sector of origin:
agriculture: 5.8% (2016 est.)
[see also: GDP - composition, by sector of origin - agriculture country ranks ]
industry: 39.2% (2016 est.)
[see also: GDP - composition, by sector of origin - industry country ranks ]
services: 54.9% (2017 est.)
[see also: GDP - composition, by sector of origin - services country ranks ]

Agriculture - products:
corn, wheat, pulses, sorghum, barley; livestock

Industries:
food, beverages, textiles, apparel assembly, handicrafts, construction, tourism

Industrial production growth rate:
12.5% (2017 est.)
country comparison to the world: 6
[see also: Industrial production growth rate country ranks ]

Labor force:
930,800 (2017 est.)
country comparison to the world: 148
[see also: Labor force country ranks ]

Labor force - by occupation:
agriculture: 86%
[see also: Labor force - by occupation - agriculture country ranks ]
industry and services: 14% (2002 est.)
note: most of the resident population is engaged in subsistence agriculture; roughly 35% of the active male wage earners work in South Africa

Unemployment rate:
28.1% (2014 est.)
25% (2008 est.)
country comparison to the world: 205
[see also: Unemployment rate country ranks ]

Population below poverty line:
57% (2016 est.)
[see also: Population below poverty line country ranks ]

Household income or consumption by percentage share:
lowest 10%: 1%
[see also: Household income or consumption by percentage share - lowest 10% country ranks ]
highest 10%: 39.4% (2003)
[see also: Household income or consumption by percentage share - highest 10% country ranks ]

Distribution of family income - Gini index:
63.2 (1995)

56 (1986-87)
country comparison to the world: 1
[see also: Distribution of family income - Gini index country ranks ]

Budget:
revenues: 1.09 billion (2017 est.)
[see also: Budget - revenues country ranks ]
expenditures: 1.255 billion (2017 est.)
[see also: Budget - expenditures country ranks ]

Taxes and other revenues:
39.7% (of GDP) (2017 est.)
country comparison to the world: 43
[see also: Taxes and other revenues country ranks ]

Budget surplus (+) or deficit (-):
-6% (of GDP) (2017 est.)
country comparison to the world: 184
[see also: Budget surplus (+) or deficit (-) country ranks ]

Public debt:
33.7% of GDP (2017 est.)
36.2% of GDP (2016 est.)
country comparison to the world: 155
[see also: Public debt country ranks ]

Fiscal year:
1 April - 31 March

Inflation rate (consumer prices):
5.3% (2017 est.)
6.2% (2016 est.)
country comparison to the world: 173
[see also: Inflation rate (consumer prices) country ranks ]

Central bank discount rate:
6.75% (2 February 2016)
6.25% (31 December 2015)
country comparison to the world: 53
[see also: Central bank discount rate country ranks ]

Commercial bank prime lending rate:
11.58% (31 December 2017 est.)
11.58% (31 December 2016 est.)
country comparison to the world: 69
[see also: Commercial bank prime lending rate country ranks ]

Stock of narrow money:
$420.8 million (31 December 2017 est.)
$356.3 million (31 December 2016 est.)
country comparison to the world: 175
[see also: Stock of narrow money country ranks ]

Stock of broad money:
$420.8 million (31 December 2017 est.)
$356.3 million (31 December 2016 est.)
country comparison to the world: 179
[see also: Stock of broad money country ranks ]

Stock of domestic credit:
$442.3 million (31 December 2017 est.)
$230.9 million (31 December 2016 est.)
country comparison to the world: 180
[see also: Stock of domestic credit country ranks ]

Current account balance:
-$102 million (2017 est.)
-$201 million (2016 est.)
country comparison to the world: 86
[see also: Current account balance country ranks ]

Exports:
$1.028 billion (2017 est.)
$894 million (2016 est.)
country comparison to the world: 160
[see also: Exports country ranks ]

Exports - partners:
South Africa 57%, US 33.5% (2017)

Exports - commodities:
manufactures (clothing, footwear), wool and mohair, food and live animals, electricity, water, diamonds

Imports:
$1.826 billion (2017 est.)
$1.613 billion (2016 est.)
country comparison to the world: 171
[see also: Imports country ranks ]

Imports - commodities:
food; building materials, vehicles, machinery, medicines, petroleum products

Imports - partners:
South Africa 87.2% (2017)

Reserves of foreign exchange and gold:
$657.7 million (31 December 2017 est.)
$925.2 million (31 December 2016 est.)
country comparison to the world: 143
[see also: Reserves of foreign exchange and gold country ranks ]

Debt - external:
$934.6 million (31 December 2017 est.)
$921.3 million (31 December 2016 est.)
country comparison to the world: 167
[see also: Debt - external country ranks ]

Stock of direct foreign investment - at home:
$497.7 million (31 December 2017 est.)
$456.5 million (31 December 2016 est.)
country comparison to the world: 129
[see also: Stock of direct foreign investment - at home country ranks ]

Stock of direct foreign investment - abroad:
$122 million (31 December 2017 est.)
$206.9 million (31 December 2016 est.)
country comparison to the world: 109
[see also: Stock of direct foreign investment - abroad country ranks ]

Exchange rates:
maloti (LSL) per US dollar -
14.48 (2017 est.)
14.71 (2016 est.)
14.71 (2015 est.)
12.76 (2014 est.)
10.85 (2013 est.)