How a Foreign Investor Rattled a Tiny African Kingdom’s Economy
Guohui Shi secured a monopoly on Lesotho’s primary export, then stopped paying producers.
Mohlalefi Moteane runs his wool and mohair brokerage out of his veterinary practice, housed in a small building on a dirt road in Maseru, the ramshackle capital of Lesotho. When a young Chinese businessman visited in 2012 asking to join the business, Moteane turned him away. He saw no need for taking on a partner he didn’t know.
Six years later the same businessman, Guohui Shi, and his Lesotho Wool Centre were awarded a monopoly over the wool and mohair trade in the Southern African mountain kingdom, meaning Moteane and other small brokers would have to shut down. Since then, thousands of farmers have had to wait a year or more to be paid by Shi’s brokerage; some say they’ve been underpaid, and others not paid at all. Approximately 75% of Lesotho’s population lives in rural areas and relies on wool and mohair for income. Some herders have been forced to eat their flocks to survive.