ABSTRACT
At independence in 1966 Lesotho was one of the world’s poorest and least developed countries. Apart from abundant water and eroding soil, there were few exploitable resources. Industries were virtually non-existent. Most of the population lived in rural areas, engaged in subsistence agriculture. The conditions for agricultural production were, however, unfavourable with shortages of cultivable land, ongoing soil erosion because of overgrazing and deforesting, an inefficient land utilisation and fragmentation arising from the land tenure system. These poor economic conditions had created a heavy economic dependence on South Africa, especially for employment, and on the United Kingdom for the major share of government spending (World Bank 1974: 27). Commerce was largely in the hands of South African traders.
