April 17, 2025 • 13 mins
Lesotho was hit with the highest U.S. tariffs on the African continent, a 50% levy on its exports, before President Donald Trump paused the move for 90 days. The kingdom’s trade minister is warning that if those duties go ahead, Lesotho could face a liquidity crisis.
Trump announced this month that tariffs of at least 10% will apply to most imports, with even steeper rates targeting goods from around 60 countries, all in a push to curb what he calls unfair trade imbalances.
Lesotho is now hoping to launch high-level talks with Washington.
On today’s episode, Jennifer Zabasajja speaks with Maarten Van Doesburg, Head of Economics at the Cape Peninsula University of Technology, about what could be at stake in those negotiations — and what Trump might really want in the long run.
For more stories from the region, subscribe to the Next Africa newsletter here
See omnystudio.com/listener for privacy information.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
Countries across Africa are scrambling to negotiate with the US
after President Trump suspended the reciprocal tariffs for ninety days.
Speaker 3 (00:17):
Nothing's over yet, but we have a tremendous amount of
spirit from other countries. We have many other countries, as
you know, many more than seventy five, and they all
want to come. Somebody had to do what we did,
and I did a ninety day pause for the people
that didn't retaliate.
Speaker 2 (00:33):
The Southern African Kingdom of Lisutu was facing a fifty
percent terraff before the reprise, and the government is soon
to be in negotiations with the US to stop the
crippling tariff from returning, warning of a crisis. If the
negotiations fail.
Speaker 4 (00:49):
We will be terribly affected. We are going to have
file liquidity issues. Symptoms of that foreign talency have about
six months came up, which is a comfortable about that
situation will change.
Speaker 2 (01:02):
On this week's Next Africa podcast, we look at what
the fallout has been from these tariffs and what nations
like Lisutu can hope to get from negotiating with the US.
I'm Jennifer Zabasanja and this is the Next Africa Podcast,
bringing you one story each week from the continent driving
(01:24):
the future of global growth with the context only Bloomberg
can provide. Joining me to discuss this today is economist
Martin van Dusberg, head of economics at Cape Peninsula University
of Technology. Martin, thank you so much for joining us.
So to start today, Martin, let's hear from someone who
(01:45):
is deeply involved in the negotiations. One of the countries,
as we mentioned, facing some of the highest tariffs under
President Trump's trade policies is Lisutu. Earlier this week we
were able to have on the show Lisutu's Trade Minister,
Morheti Sdile, and we talked to him about the ongoing
negotiations and whether he's clear or not on what the
(02:08):
US actually wants lest you to to do. Let's just
take a listen very quickly and we'll talk to you after.
Speaker 4 (02:14):
They should be in a position to advise us what
else they find it difficult for themselves to establish in Lesutu.
It could be anything really, For instance, that there's been
some suggestions that we should be by hertain things from
them in terms of greens. We die quite a lot
(02:37):
in South Africa and it's fair affordable and let to
keep that market. But we have to understand if there
is any problem for them accessing the market that could
be nontally related.
Speaker 2 (02:51):
And I wonder Minister, when you and the rest of
the government there the country heard about this fifty percent
tire of initial did you run the numbers? How could
that potentially affect the economy if in fact it does
stay after the pause.
Speaker 1 (03:10):
Yes, we have run the numbers.
Speaker 4 (03:13):
Directly On the fire line is the twelve thousand jobs
that we have here, which is going to now at
the know the day translated to feather forty thousand jobs.
That depends on the twelve thousand, we will be terribly affected.
We are going to have liquidity issues in terms of
(03:35):
foreign turrency. We have about six months cover, which is
very comfortable, but that situation will change.
Speaker 2 (03:42):
Martin, thank you so much for joining us. You can
hear Minister Chadilla's frustration there when we were speaking earlier
this week. Maybe you can start us off by explaining
why SU two faced such high tariffs from the Trump administration,
especially considering how it pales in comparison to some of
(04:03):
these other countries that are also facing tariffs.
Speaker 1 (04:08):
It's a difficult question to answer because Trump's decision making
has been fairly erratic, to say the least in terms
of across the born tariffs and then specific tariffs and
so on. But in essence, what I see from the
Trump tariff reshim if we can call it, that is,
and he defends it in saying that he wants to
(04:30):
produce as much more goods in America, and textiles is
one of the areas that he has seen can be produced,
and I think it comes really from there. So if
you look at the Suitu textile industry, that is predominantly
what is being exported to the United States, and yeah,
fifty percent would make it obviously totally unachievable. If I
(04:53):
can jump straight into the way I've been following Trump
quite closely with this and what I say following to
understand because of the impact in all the different economies
and what could come out of this is potentially I
think minerals. One of Nasuta's biggest driving industries is diamond binding.
(05:14):
Luti has diamonds but based metals uranium. They've even got
deposits of crude oil gas et cetera. These are not
being exported to the United States at the moment. And
I think wherever I have seen Trump, we even saw
it with the Ukraine War. If we can go back there,
you know, he said to Zelansky, We're we're gonna stop
supporting you, and then all of a sudden, but hang on,
(05:36):
you know, can we have your mineral rights? I honestly
feel that what Trump is doing is is targeting different
countries based on a what is the particular export that
is coming from that country, what's the relationship with that country?
Does that country have a strong tie with Russia, China
and other allies which there use the word of enemies
(05:58):
of what he sees as enemies of the United States.
So it's more than just the textiles, it's where does
the suit to fit in his biggest scheme of things.
That's what I believe we need to look at.
Speaker 2 (06:10):
That means that you think that there is a bigger,
wider plan with these triffs, Is that essentially what you're saying,
I do.
Speaker 1 (06:20):
I think that he will negotiate the tariffs down with
countries where he sees a future benefit to the United
States or to the Donald Trump plan. And I think
we're already starting to see that. So he immediately put
on the ninety day moratorium or the ninety day suspension,
and I think what that is His aim there is
(06:41):
to give countries an opportunity to say, well, how do
we deal with this? You know? Are we if we
just go back with retaliatory tariffs, which we've seen, you know,
then it's truly going to become a tariff for and
then there's a no win situation, I think for both
countries if we're looking at a two country situation. But
I think what what he's looking for is for countries
(07:01):
now to come back and say, well, let's see how
we can be proactive together and almost a titch for
tech types situation. So yeah, I'm being quite bold making
that statement, and I don't think too many other economists
have made that statement. But I if I just go back,
and I'm going to repeat too much, but if we
go back to the ways Delta is Ukraine, ways dealing
with countries that have got strategic funerals and strategic inputs
(07:25):
that America could use, those are the countries that I
think is starting to frame here approach to.
Speaker 2 (07:32):
Stick with us Martin when we come back we'll talk
more about what could be on the table in some
of these negotiations. We'll be right back, Welcome back.
Speaker 4 (07:44):
Today.
Speaker 2 (07:45):
We're talking about the continued to fallout from President Trump's
tariff plans as countries scramble to negotiate deals to avoid
reciprocal tariffs. We are joined by economists Martin van Drusberg. So, Martin,
we were touching on a few of the points earlier,
or you were touching on a few of the points earlier,
about what the suit could bring to the table if
(08:07):
they do end up having these meetings with US officials.
Another point that the Minister had brought attention to me too,
was that there was a senior US official planning to
make a trip to Pretoria in South Africa and potentially
then they can have discussions. Can you touch on maybe
the correlation between the Lisu Tou economy and the South
(08:29):
African economy and maybe what could be put on the table,
because you know, Lasuta's economy really depends a lot on
South Africa correct one hundred percent.
Speaker 1 (08:40):
The currency is linked to the South African rand one
for one, so they're very very dependent economic out South Africa.
Speaker 2 (08:48):
Are there things that both countries can maybe present that
would be appealing for the US.
Speaker 1 (08:53):
I think we have to face their addit. Adult Trump
is not happy with South Africa for a number of
primarily the close association that South Africa has with Russia
and with China and with other potentially other states, even Iran.
And let's just talk about that for a moment, because
(09:14):
this is important. Isn't the political aspects even South africa
stance on the Israeli Gaza conflict. So I believe that
the political relationship with South Africa is extremely weak. Now
Lasuit is economy, I won't say a hundred percent dependent
on South Africa, but it's closely linked South African economy.
(09:34):
How do we deal with that? You're one hundred percent right?
So the minister yesterday saying, well, what can be done?
We want to send a high delegation to have discussions.
My view is that the discussions need to take place
firstly at a very high level political point. If we
bring it down to the most simplest form, what does
South Africa have? What does Lasuit you have that it
(09:55):
would offer to the United States for it to be
beneficial to increase our trade Because even for US, for
South Africa and for the city to find additional markets
I said earlier, to diversify the export markets. This will
also take time, however, and you I'm coming to the
point of the dollarization or the potential weakening of the dollar,
(10:15):
so this needs to take place. What can be done?
I've mentioned some of the issues I think it revolves
in both are. South Africa is rich in minerals. The
suture is perhaps not as rich, but certainly very diamond rich.
So I believe that there are other products which could
be looked at, you know, which aren't currently being exported
(10:35):
violent from the suity to the United States. Now what
the suit is done, it's a matter of interest. The
very important matter of interest is that it is driven
its mining with a partnership with with private sector. So
there could be I'm going as far as saying there
could be private sector in from the United States into
the lists economy. They could be And here's the the
(11:00):
light at the end of the tunnel, if I could
use that cliche.
Speaker 3 (11:03):
What is there?
Speaker 1 (11:04):
Where can we go with this? Well, I honestly believe
there is a future both countries need and the and
the region, the Southern African region, should I believe talk
to the United States as a as a valuable training partner,
and whether we agree with the Trump issues or not,
that's not relevant. Right now is the president and these
are the issues we've got to be faced with. You
(11:24):
can't you can't deny that these tariffs are going to come,
but they are ways to look at. How can we
mitigate this, how can we alleviate this, and frankly, how
can we work together. South Africa is in desperate need
of foreign direct investment and through I believe high level negotiations,
high higher level negotiations, political negotiations, with an economic founding model,
(11:50):
we could look at the United States investing more in
Southern African countries.
Speaker 2 (11:56):
Martin, thank you so much for joining us and for
your analysis. Really appreciate you being on the show this week,
and you can read all of our coverage on the
US tariffs across Bloomberg platforms. Now here's some of the
other stories from the region that we've been following this week.
The government of Ghana has assumed control of Goldfields's Demang
(12:19):
mine after the West African nation rejected an application to
extend the company's lease. It aligns with the government's policy
of moving away from the neo colonial practice of automatically
renewing mining licenses in Ghana. In a statement, authority said
this decision was taken on grounds including the failure to
declare verifiable mineral reserves in the renewal application and the
(12:44):
lack of budgetary allocation for exploration. And kenyep is seeking
realistic targets in a new program with the International Monetary Fund,
according to a top government official, following deadly protests over
taxes and US President Donald Trump's trade levies. And Kenya
is seeking realistic targets in a new program with the
(13:06):
International Monetary Fund, according to a top government official, following
deadly protests over taxes and US President Donald Trump's trade levies.
The East African Nations government will start talks with the
lender this spring and probably conclude a deal by November,
according to the Prime Cabinet secretary. He declined to give
(13:28):
details of potential terms of the program. You can follow
these stories across Bloomberg, including the Next African Newsletter. Will
put a link to it in the show notes. This
program was produced by Adrian Bradley. Don't forget to follow
and review the show wherever you usually get your podcasts.
(13:49):
I'm Jennifer Zabasaja. Thanks as always for listening.
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
Countries across Africa are scrambling to negotiate with the US
after President Trump suspended the reciprocal tariffs for ninety days.
Speaker 3 (00:17):
Nothing's over yet, but we have a tremendous amount of
spirit from other countries. We have many other countries, as
you know, many more than seventy five, and they all
want to come. Somebody had to do what we did,
and I did a ninety day pause for the people
that didn't retaliate.
Speaker 2 (00:33):
The Southern African Kingdom of Lisutu was facing a fifty
percent terraff before the reprise, and the government is soon
to be in negotiations with the US to stop the
crippling tariff from returning, warning of a crisis. If the
negotiations fail.
Speaker 4 (00:49):
We will be terribly affected. We are going to have
file liquidity issues. Symptoms of that foreign talency have about
six months came up, which is a comfortable about that
situation will change.
Speaker 2 (01:02):
On this week's Next Africa podcast, we look at what
the fallout has been from these tariffs and what nations
like Lisutu can hope to get from negotiating with the US.
I'm Jennifer Zabasanja and this is the Next Africa Podcast,
bringing you one story each week from the continent driving
(01:24):
the future of global growth with the context only Bloomberg
can provide. Joining me to discuss this today is economist
Martin van Dusberg, head of economics at Cape Peninsula University
of Technology. Martin, thank you so much for joining us.
So to start today, Martin, let's hear from someone who
(01:45):
is deeply involved in the negotiations. One of the countries,
as we mentioned, facing some of the highest tariffs under
President Trump's trade policies is Lisutu. Earlier this week we
were able to have on the show Lisutu's Trade Minister,
Morheti Sdile, and we talked to him about the ongoing
negotiations and whether he's clear or not on what the
(02:08):
US actually wants lest you to to do. Let's just
take a listen very quickly and we'll talk to you after.
Speaker 4 (02:14):
They should be in a position to advise us what
else they find it difficult for themselves to establish in Lesutu.
It could be anything really, For instance, that there's been
some suggestions that we should be by hertain things from
them in terms of greens. We die quite a lot
(02:37):
in South Africa and it's fair affordable and let to
keep that market. But we have to understand if there
is any problem for them accessing the market that could
be nontally related.
Speaker 2 (02:51):
And I wonder Minister, when you and the rest of
the government there the country heard about this fifty percent
tire of initial did you run the numbers? How could
that potentially affect the economy if in fact it does
stay after the pause.
Speaker 1 (03:10):
Yes, we have run the numbers.
Speaker 4 (03:13):
Directly On the fire line is the twelve thousand jobs
that we have here, which is going to now at
the know the day translated to feather forty thousand jobs.
That depends on the twelve thousand, we will be terribly affected.
We are going to have liquidity issues in terms of
(03:35):
foreign turrency. We have about six months cover, which is
very comfortable, but that situation will change.
Speaker 2 (03:42):
Martin, thank you so much for joining us. You can
hear Minister Chadilla's frustration there when we were speaking earlier
this week. Maybe you can start us off by explaining
why SU two faced such high tariffs from the Trump administration,
especially considering how it pales in comparison to some of
(04:03):
these other countries that are also facing tariffs.
Speaker 1 (04:08):
It's a difficult question to answer because Trump's decision making
has been fairly erratic, to say the least in terms
of across the born tariffs and then specific tariffs and
so on. But in essence, what I see from the
Trump tariff reshim if we can call it, that is,
and he defends it in saying that he wants to
(04:30):
produce as much more goods in America, and textiles is
one of the areas that he has seen can be produced,
and I think it comes really from there. So if
you look at the Suitu textile industry, that is predominantly
what is being exported to the United States, and yeah,
fifty percent would make it obviously totally unachievable. If I
(04:53):
can jump straight into the way I've been following Trump
quite closely with this and what I say following to
understand because of the impact in all the different economies
and what could come out of this is potentially I
think minerals. One of Nasuta's biggest driving industries is diamond binding.
(05:14):
Luti has diamonds but based metals uranium. They've even got
deposits of crude oil gas et cetera. These are not
being exported to the United States at the moment. And
I think wherever I have seen Trump, we even saw
it with the Ukraine War. If we can go back there,
you know, he said to Zelansky, We're we're gonna stop
supporting you, and then all of a sudden, but hang on,
(05:36):
you know, can we have your mineral rights? I honestly
feel that what Trump is doing is is targeting different
countries based on a what is the particular export that
is coming from that country, what's the relationship with that country?
Does that country have a strong tie with Russia, China
and other allies which there use the word of enemies
(05:58):
of what he sees as enemies of the United States.
So it's more than just the textiles, it's where does
the suit to fit in his biggest scheme of things.
That's what I believe we need to look at.
Speaker 2 (06:10):
That means that you think that there is a bigger,
wider plan with these triffs, Is that essentially what you're saying,
I do.
Speaker 1 (06:20):
I think that he will negotiate the tariffs down with
countries where he sees a future benefit to the United
States or to the Donald Trump plan. And I think
we're already starting to see that. So he immediately put
on the ninety day moratorium or the ninety day suspension,
and I think what that is His aim there is
(06:41):
to give countries an opportunity to say, well, how do
we deal with this? You know? Are we if we
just go back with retaliatory tariffs, which we've seen, you know,
then it's truly going to become a tariff for and
then there's a no win situation, I think for both
countries if we're looking at a two country situation. But
I think what what he's looking for is for countries
(07:01):
now to come back and say, well, let's see how
we can be proactive together and almost a titch for
tech types situation. So yeah, I'm being quite bold making
that statement, and I don't think too many other economists
have made that statement. But I if I just go back,
and I'm going to repeat too much, but if we
go back to the ways Delta is Ukraine, ways dealing
with countries that have got strategic funerals and strategic inputs
(07:25):
that America could use, those are the countries that I
think is starting to frame here approach to.
Speaker 2 (07:32):
Stick with us Martin when we come back we'll talk
more about what could be on the table in some
of these negotiations. We'll be right back, Welcome back.
Speaker 4 (07:44):
Today.
Speaker 2 (07:45):
We're talking about the continued to fallout from President Trump's
tariff plans as countries scramble to negotiate deals to avoid
reciprocal tariffs. We are joined by economists Martin van Drusberg. So, Martin,
we were touching on a few of the points earlier,
or you were touching on a few of the points earlier,
about what the suit could bring to the table if
(08:07):
they do end up having these meetings with US officials.
Another point that the Minister had brought attention to me too,
was that there was a senior US official planning to
make a trip to Pretoria in South Africa and potentially
then they can have discussions. Can you touch on maybe
the correlation between the Lisu Tou economy and the South
(08:29):
African economy and maybe what could be put on the table,
because you know, Lasuta's economy really depends a lot on
South Africa correct one hundred percent.
Speaker 1 (08:40):
The currency is linked to the South African rand one
for one, so they're very very dependent economic out South Africa.
Speaker 2 (08:48):
Are there things that both countries can maybe present that
would be appealing for the US.
Speaker 1 (08:53):
I think we have to face their addit. Adult Trump
is not happy with South Africa for a number of
primarily the close association that South Africa has with Russia
and with China and with other potentially other states, even Iran.
And let's just talk about that for a moment, because
(09:14):
this is important. Isn't the political aspects even South africa
stance on the Israeli Gaza conflict. So I believe that
the political relationship with South Africa is extremely weak. Now
Lasuit is economy, I won't say a hundred percent dependent
on South Africa, but it's closely linked South African economy.
(09:34):
How do we deal with that? You're one hundred percent right?
So the minister yesterday saying, well, what can be done?
We want to send a high delegation to have discussions.
My view is that the discussions need to take place
firstly at a very high level political point. If we
bring it down to the most simplest form, what does
South Africa have? What does Lasuit you have that it
(09:55):
would offer to the United States for it to be
beneficial to increase our trade Because even for US, for
South Africa and for the city to find additional markets
I said earlier, to diversify the export markets. This will
also take time, however, and you I'm coming to the
point of the dollarization or the potential weakening of the dollar,
(10:15):
so this needs to take place. What can be done?
I've mentioned some of the issues I think it revolves
in both are. South Africa is rich in minerals. The
suture is perhaps not as rich, but certainly very diamond rich.
So I believe that there are other products which could
be looked at, you know, which aren't currently being exported
(10:35):
violent from the suity to the United States. Now what
the suit is done, it's a matter of interest. The
very important matter of interest is that it is driven
its mining with a partnership with with private sector. So
there could be I'm going as far as saying there
could be private sector in from the United States into
the lists economy. They could be And here's the the
(11:00):
light at the end of the tunnel, if I could
use that cliche.
Speaker 3 (11:03):
What is there?
Speaker 1 (11:04):
Where can we go with this? Well, I honestly believe
there is a future both countries need and the and
the region, the Southern African region, should I believe talk
to the United States as a as a valuable training partner,
and whether we agree with the Trump issues or not,
that's not relevant. Right now is the president and these
are the issues we've got to be faced with. You
(11:24):
can't you can't deny that these tariffs are going to come,
but they are ways to look at. How can we
mitigate this, how can we alleviate this, and frankly, how
can we work together. South Africa is in desperate need
of foreign direct investment and through I believe high level negotiations,
high higher level negotiations, political negotiations, with an economic founding model,
(11:50):
we could look at the United States investing more in
Southern African countries.
Speaker 2 (11:56):
Martin, thank you so much for joining us and for
your analysis. Really appreciate you being on the show this week,
and you can read all of our coverage on the
US tariffs across Bloomberg platforms. Now here's some of the
other stories from the region that we've been following this week.
The government of Ghana has assumed control of Goldfields's Demang
(12:19):
mine after the West African nation rejected an application to
extend the company's lease. It aligns with the government's policy
of moving away from the neo colonial practice of automatically
renewing mining licenses in Ghana. In a statement, authority said
this decision was taken on grounds including the failure to
declare verifiable mineral reserves in the renewal application and the
(12:44):
lack of budgetary allocation for exploration. And kenyep is seeking
realistic targets in a new program with the International Monetary Fund,
according to a top government official, following deadly protests over
taxes and US President Donald Trump's trade levies. And Kenya
is seeking realistic targets in a new program with the
(13:06):
International Monetary Fund, according to a top government official, following
deadly protests over taxes and US President Donald Trump's trade levies.
The East African Nations government will start talks with the
lender this spring and probably conclude a deal by November,
according to the Prime Cabinet secretary. He declined to give
(13:28):
details of potential terms of the program. You can follow
these stories across Bloomberg, including the Next African Newsletter. Will
put a link to it in the show notes. This
program was produced by Adrian Bradley. Don't forget to follow
and review the show wherever you usually get your podcasts.
(13:49):
I'm Jennifer Zabasaja. Thanks as always for listening.
Host
Jennifer Zabasajja
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