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IS ESWATINI A CAPITALIST OR SOCIALIST COUNTRY?

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mfanukhona@times.co.sz


MBABANE – United States President Donald Trump believes socialism ‘destroys nations’.


In his 2020 State of the Union Address, the US president appeared advocating for the capitalist form of economy or government. If Trump advocates against socialism, where does Eswatini stand?


Is the kingdom a socialist or capitalist State?  The third factor to be considered apart from socialism and capitalism is whether Eswatini has a mixed economy, which lie on a continuum between pure capitalism and pure socialism? 
Continuum is a continuous sequence in which adjacent elements are not perceptibly different from each other, although extremes are quite distinct.

What is socialism?

Political scientists define socialism as a populist economic and political system based on public ownership (also known as collective or common ownership) of the means of production. Those means include machinery, tools, factories used to produce goods that aim to directly satisfy human needs and land.
 In a purely socialist system, all legal production and distribution decisions are made by the government, and individuals rely on the State for everything from food to health care. The government determines the output and pricing levels of these goods and services.
Socialists contend that shared ownership of resources and central planning provide a more equal distribution of goods and services and a more equitable society.

What is capitalism?

Capitalism is an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the State.
In short, experts say capitalism is an economic system characterised by private ownership of the means of production, especially in the industrial sector.
It depends on the enforcement of private property rights, which provide incentives for investment in and productive use of productive capital.

real-world practice
The scientists of politics also say that the real-world practice of capitalism typically involves some degree of so-called ‘crony capitalism’ due to demands from business for favourable government intervention and governments’ incentive to intervene in the economy.
In a capitalist State, the production of goods and services is based on supply and demand in the general market—known as a market economy—rather than through central planning—known as a planned economy or command economy.
They say the purest form of capitalism is free market or laissez-faire capitalism.
Simply put, laissez-faire translates to ‘leave us alone’ meaning that the government should remain out of the economy and instead allow individuals to freely carryout their own economic affairs. Is that the case in Eswatini?
In a laissez-faire capitalism, private individuals are unrestrained. They may determine where to invest, what to produce or sell, and at which prices to exchange goods and services. The laissez-faire marketplace operates without checks or controls.

South Africa

Even though political systems are distinct, the Eswatini economy, as a matter of fact, is very closely linked to that of South Africa. In fact, South Africa is the country’s largest trading partner, from which the kingdom receives over 90 per cent of its imports and to which it sends about 70 per cent of its exports.
Martin van Staden remarked in his analysis of South Africa’s economy, that the notion that the republic is a capitalist society is popular among journalists, politicians and trade unionists.
Martin argues that if capitalism is understood to mean a system of free and voluntary engagement without third-party interference, the notion that South Africa is capitalist is false.
He said such false belief had been used to justify far more government intervention in the economy than is necessary, and has led to stagnated growth and destitution.
The truth is that South Africa is a social democracy fast approaching socialism, he opined.

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