Academic journal article Journal of Small Business Management

Voluntarily Socialist Culture and Small Business in the Kingdom of Lesotho

Academic journal article Journal of Small Business Management

Voluntarily Socialist Culture and Small Business in the Kingdom of Lesotho

Article excerpt

Reflecting Basuto cultural values, socialism occurs voluntarily in the economic system of Lesotho. A distinction is made between assets for personal use (which are transferable), and property with social value which, although maintained privately, cannot be freely sold. Unlike in the many states where socialism with imposed by external forces and eventually collapsed, the socialist concepts in this mountain kingdom of southern Africa originate from within the culture, and have survived in strength today, enforced only by cultural custom and not by political or military intervention. This has contributed to a unique small business sector, as the culture encourages entrepreneurship in as much as it values the accumulation of wealth; however, the same culture hinders some aspects of entrepreneurial activity through its perceptions of property.


This essay is the result of ethnography conducted by the author in Lesotho. Field research included interviews with a wide range of persons, including government representatives, local entrepreneurs, foreign investors, and international observers. The author travelled across the nation by motor vehicle where possible and on horseback in areas where there were no roads.


Lesotho is the land of Sotho peoples. During the tribal wars of the nineteenth century, the strategy of one village chief was to grant land and cattle to refugees from neighboring villages in exchange for protecting his domain. During this period, the Sotho people, numbering 40,000 in 1840, grew to over 150,000 by 1870. This village chief became known as King Moshoeshoe the Great; his people, the Basuto nation; and his land, Basutoland.

In response to increasing conflicts with the expanding Boers, King Moshoeshoe called on the British in 1868 for assistance. Sixteen years later, the British took direct control of the Basutoland protectorate and soon began taxing its people. Martin gives an account:

The revenue is comfortable and is chiefly derived from the hut tax. This is a tax levied on each wife in reality, though it is nominally on the hut. It used to be 10 shillings for each hut, but has now been raised to [pound]1 each. A man having two wives pays [pounds]2, though he may have three or more huts, and so on (1903, p. 68).(1)

The first democratic elections in Basutoland took place in 1960, and the victorious Basutoland Congress Party demanded full independence from Britain. On October 4, 1966, the Kingdom of Lesotho became independent. Chief Leabua Jonathan served as prime minister while King Moshoeshoe II (great-great-grandson of Moshoeshoe the Great) replaced Queen Elizabeth II as sovereign. A mere four years later, however, the prime minister suspended the democratic constitution.

In 1986, Major-General Justin Lekhanya deposed Prime Minister Jonathan and imposed military rule. In October 1990, the king refused to be reduced to a constitutional monarch; the military council responded by terminating his power. Regent-Queen Mamahato served as caretaker monarch, while her husband was exiled to London. In November 1990, their 27-year-old son was coronated King Letsie III.

During much of the 20th century, Lesotho's chief source of income was the remittances of Basuto migrant laborers who worked in the gold mines of the Republic of South Africa (R.S.A.). Lesotho benefited from sanctions against apartheid, as its manufacturers had preferred access to markets from which the R.S.A. was banned. However, in 1994 the white government of South Africa relinquished to black rule, and sanctions were removed. This presented strong competition for Lesotho. Furthermore, the African National Congress had promised jobs for its own people and had no obligations to continue the employment of Lesotho citizens. By 1996, there was great concern about the economic situation in Lesotho.

Current Circumstances

With a surface area of only 30,355 square km. …

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