Parliament’s ad-hoc committee investigating Lesotho’s wool and mohair sector on Wednesday grilled under-fire Chinese businessman, Stone Shi.
Shi is now the sole broker of the country’s wool and mohair after being handed the role through amendments to an existing regulation by the government last year.
He does this through the Lesotho Wool Centre—a joint-venture entered into by the Lesotho National Wool and Mohair Growers Association (LNWMGA) and his company called Maseru Dawning Trading (PTY) LTD.
But relations have since soured between the joint-venture partners over the auctioning of the wool and mohair before the development of all infrastructure initially agreed to in the deal, leaving Shi to go it alone.
Shi also stands accused of applying underhand manoeuvres on the government, resulting in the law that forced farmers to sell their wool through the Lesotho Wool Centre and stopping them from independently selling and exporting their produce using brokers of their choice.
Shi is said to have managed this through his alleged influence over Small Business, Cooperatives and Marketing minister Chalane Phori, resulting in the 1974 subordinate law governing the wool and mohair business in the country being amended in his favour.
As a result of the amendment, he became the only broker granted a license to operate a wool and mohair selling and buying enterprise in the country.
This has since sparked protests from farmers who preferred selling their wool through South Africa-based brokers such as BKB. The farmers say Shi has impoverished them through delayed payments, low returns and failure to source new markets for their wool and mohair as he had promised. The angry farmers marched to parliament last month and demanded the abolishment of the regulations that made Shi the sole broker.
The protest led to the establishment of parliament’s ad-hoc committee to probe the new regulation which came into effect last year, as well as the wool and mohair sector as a whole.
The ad-hoc committee comprises MPs Likopo Mahase, Ntlhoi Motsamai, Selibe Mochoboroane, Teboho Sekata, Kimetso Mathaba, Thulo Mahlakeng, Limpho Tau, Moeketse Malebo, ‘Mapulumo Hlao, Thuso Litjobo and Thabang Kholumo, Motlohi Maliehe, Mohapi Mohapinyane, Tšeliso Kalake, Kose Makoa, Tlokotsi ‘Manyoko and ‘Marapelang Malefane.
The committee had interviewed Phori and LNWMGA chairperson Mokoinihi Thinyane before meeting Shi. Thinyane on Tuesday told the committee that the farmers preferred the localisation of the auction to have been done gradually.
Minister Phori appeared before the committee after Thinyane.
During Wednesday’s probe, Sekata asked Shi how he ended up in Lesotho when his business was not the company the farmers had originally preferred.
Kholumo also asked Shi why Minister Phori appeared to have detailed information about the running of the centre.
Kholumo said Phori appeared to be a co-manager of the Lesotho Wool Centre or “micro-managing the centre”.
The Qalo legislator further quizzed Shi whether the absence of LNWMGA representation in the Lesotho Wool Centre delegation appearing before the committee meant the joint-venture now existed on paper only.
Kholumo also told Shi there were allegations that he constructed a mansion for Phori as a bribe or gift, which he asked him to elaborate.
In response, Shi dismissed the allegations against him and said they were being made by people who hated him for reasons he did not know.
Shi further told the committee that only 4, 090 farmers had not been paid countrywide due to reasons that included, among others, old bank accounts that fail in the payment system. He said 47, 813 farmers had already received their payments, adding in total, M318, 366, 526. 78 had already been paid to the farmers.
The embattled businessman further told the committee that the farmers’ association turned its back on him before the operation of the centre and learning a thing or two from him, thereby crippling the industry.
“The association’s decision created a huge communication gap between farmers and the centre. We had to go to some of the farmers by ourselves as the Lesotho Wool Centre, when that was supposed to be the role of the association,” said Shi.
Shi also told the committee that the Lesotho Wool Centre started operating in 2017 with 800 bales of wool which were sold through negotiated deals with buyers in China.
“Our operations have not been smooth-running since we started operations, with the very first being to secure the produce from the farmers,” Shi told the committee.
Shi said he failed to understand why the association hated him so much while it had invited him to Lesotho in the first place.
The committee also repeatedly questioned Shi about Phori’s role in the Lesotho Wool Centre.
“Minister Phori does not have any shares or role in my company. I just know him as the minister in charge of the wool and mohair industry in Lesotho.
“After our broken relationship with the association, I had nowhere to run but to the minister responsible for the wool and mohair industry and the Minister of Trade and Industry, Tefo Mapesela (currently Minister of Defence), whom I hoped would take care of my business as an investor,” Shi said.
Shi also rubbished allegations raised by the committee that his relation with Phori had gone too far to the extent that he had built a mansion for the minister. Shi said: “I hate these rumours; I never built a mansion for him. All this is from people who have since hated me for no reason.”