Lesotho Weighs Starlink License to Attract U.S. Investment Amid Looming Tariff Crisis

Lesotho’s government is reviewing Starlink’s application for a network services license, positioning the move as part of a broader economic strategy to boost U.S. investment, even as a 50% export tariff on its goods remains paused for only 90 days.

At the Third Public-Private Dialogue National Conference held in Maseru on April 9, Prime Minister Samuel Matekane framed the licensing consideration as an intentional signal to the U.S. government. The initiative comes at a critical time when Lesotho’s economy, heavily reliant on textile exports to the United States, faces severe uncertainty due to rising protectionist trade policies under Donald Trump’s administration.

Starlink’s Entry and the Promise of U.S. Ties

The Lesotho Communications Authority (LCA) confirmed receiving Starlink’s application in February 2025. The Elon Musk-owned satellite internet provider could offer high-speed, low-latency connectivity across the mountainous kingdom, helping bridge digital access gaps in rural areas. But the government’s messaging indicates more than just infrastructure improvement—it sees Starlink as a potential diplomatic lever.

By removing barriers to U.S. companies, Matekane hopes to foster goodwill and avoid punitive tariffs on Lesotho’s textile exports. These exports, primarily to American brands like Levi’s and Calvin Klein, are facilitated through the African Growth and Opportunity Act (AGOA), a U.S. trade preference program for sub-Saharan African countries.

Local Backlash Over Foreign Ownership

Despite its strategic value, Starlink’s bid has encountered sharp resistance during public consultations. Advocacy groups such as Section Two, alongside telecom giants like Vodacom Lesotho, have called for local shareholding requirements. Critics argue that approving a 100% foreign-owned entity without similar obligations risks undermining national interests and creating an uneven playing field.

Vodacom Lesotho and Econet Telecom Lesotho, two major players in the market, currently operate with local equity participation—an arrangement stakeholders believe supports both national sovereignty and sustainable telecom development.

Opponents also warn that licensing Starlink could damage diplomatic relations with South Africa, which rejected Starlink’s bid on similar grounds. South Africa remains Lesotho’s largest trading partner, and Vodacom South Africa holds an 80% stake in Vodacom Lesotho.

Economic Stakes and the Tariff Pressure

Lesotho’s economic vulnerability underpins the urgency behind the government’s strategy. The country’s GDP, approximately $2 billion, is heavily dependent on textile exports to the U.S. In 2023 alone, $240 million worth of goods flowed to the U.S. under AGOA, compared to only $8 million in reverse exports. If the proposed 50% tariff is enacted after the current 90-day reprieve, it could threaten over 12,000 factory jobs tied to AGOA.

Lesotho’s Trade, Industry, and Business Development Minister, Mokhethi Shelile, has expressed doubts over the effectiveness of the current diplomatic pause. “I do not know what is going to happen after 90 days,” Shelile told SABC. “It is said that it is done so that we can sit down and negotiate. I do not have a good experience in terms of trying to get meetings with the Trump administration.”

Starlink’s Potential Impact on Connectivity

From a connectivity standpoint, Starlink’s entry could be transformative. With broadband penetration still limited in Lesotho, especially in rural and remote regions, satellite-based internet could support digital inclusion, education, remote work, and business digitization.

However, experts note that while the digital benefits are clear, the debate cannot be decoupled from issues of governance and fair market participation.

Balancing National Interest with Global Tech Access

Granting Starlink a license without enforcing local ownership standards may spark regulatory precedent concerns across Africa. It could open the floodgates for fully foreign-owned tech operators to bypass local empowerment policies. In a region increasingly focused on data sovereignty, digital inclusion, and fair competition, Lesotho’s decision could ripple far beyond its borders.

Conclusion

Lesotho finds itself at the intersection of geopolitics, trade, and digital transformation. The government’s willingness to approve Starlink as a means to curry favor with the U.S. reflects the high stakes tied to the looming export tariff. But the backlash from local stakeholders highlights the fine line between economic pragmatism and safeguarding national interest.

As the 90-day window draws closer to its end, the outcome of Lesotho’s Starlink decision may not only shape the country’s digital landscape—but also signal how smaller African economies intend to navigate an increasingly complex global tech and trade environment.