Tax incentives

• 10% corporate income tax on manufacturing profits
• No withholding tax on dividends distributed by manufacturing firms to local or foreign shareholders.
• Training costs are allowable at 125% for tax purposes.

Stability

• A stable social and political environment which is investor friendly.
• A free enterprise and free market economic system, which forms the basis for sustained development and growth.

Labour

Young, abundant, predominantly English speaking, literate, well-motivated labour force with a tradition of manual dexterity at competitive wage rates.

Market access

• Duty free and quota free access of Lesotho made products to a market of:
  • 55 million consumers within the Southern African Customs Union (SACU) comprising Botswana, Lesotho, Namibia, Swaziland and South Africa.
  • The Southern African Development Community (SADC) – (14 countries comprising 260 million consumers).
• ​Preferential market access of Lesotho originating products into the Australian market (22 million consumers), affording them duty free access or reduced rates of duty.
• Duty free access for a large list of products except for dairy, poultry and egg products granted by Canada (34 million consumers) under the GSP system.
• A preferential treatment agreement between SACU and MERCOSUR (comprising Argentina, Brazil, Paraguay, and Uruguay (385 million consumers) grants trade preferences on specific products originating from Lesotho as member of SACU.
• The SACU EFTA gives SACU originating industrial and fish products duty free and quota free access to Switzerland, Norway, Iceland and Liechtenstein.
• Lesotho can also export all products to the European Union (500 million consumers) duty free provided under SACU EPA Agreement.
• Lesotho’s industrial products can be exported duty and quota free to Japan, New Zealand, and Turkey under a GSP scheme introduced in 1972.
• Lesotho benefits from the lucrative American market (310 million consumers) provided by the African Growth Opportunity Growth (AGOA).