The Menace of Unchecked Capitalism and Globalization on Somalia’s Economy

Somalia grapples with issues in state-building and a complex interplay of challenges. One major crisis is the economic model negatively impacting the well-being of the people and threatening the state itself.

Unregulated capitalism, combined with exposure to global trade, has harmed both the state and society in Somalia. Understanding the economic system in place is essential before delving into the problems it has caused.

Somalia’s economic model is a mix of traditional and capitalist systems, with many economic distortions. While the capitalist system is supported by international financial institutions, it comes with its own set of failures.

The capitalist system has led to privatization in vital sectors in Somalia, causing hardships for citizens. The government has struggled to regulate the market and provide essential services adequately.

Globalization has worsened economic challenges in Somalia, affecting local production and income inequality. The lack of state involvement in regulating the economy has made it more vulnerable to external shocks.

The economic system in Somalia lacks state supervision, allowing key market stakeholders to manipulate it for their benefit. International financial institutions impose conditions that further restrict the country’s sovereignty.

To address these issues, Somalia needs a comprehensive approach that includes effective state regulation, fair taxation, and protection of public services. By prioritizing the well-being of its population, Somalia can create a more resilient and inclusive economy.

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