LED
is about communities continually upgrading their investment climates to improve
their competitiveness, retain jobs and improve incomes. Local communities
respond to their LED needs in many ways. There are a wide variety of LED
initiatives including:
o Ensuring that the local investment climate is functional
for local businesses
o Supporting small and medium sized businesses (SMEs)
o Encouraging new enterprise establishment
o Attracting investment from elsewhere (within the country
and internationally)
o Investing in physical (hard) infrastructure
o Investing in soft infrastructure (including human resource
development, institutional support systems and regulatory issues)
o Supporting the growth of particular business clusters
o Targeting particular parts of the city for regeneration or
growth (spatial targeting)
o Supporting survivalist (often informal) businesses
Local
Economic Development (LED) is an outcome, based on local initiative and driven
by local stakeholders. It involves
identifying and using local resources, ideas and skills to stimulate economic
growth and development. The aim of LED is to create employment opportunities
for local residents, alleviate poverty, and redistribute resources and
opportunities to the benefit of all local residents.
It
is important to realise that LED is an ongoing process, rather than a single
project or a series of steps to follow.
LED encompasses all stakeholders in a local community, involved in a
number of different initiatives aimed at addressing a variety of socio-economic
needs in that community.
Local
economic development initiatives always take place in the context of the
national and global economies. Changes
in the national and global economy impact on local economies in different ways. For example, a fluctuation in global gold prices
may mean that a gold mine, which is the main employer in a small town, is
closed down, resulting in high unemployment (i.e. Matjhabeng Local
Municipality
There
is no single approach to LED, which will work in every local area. Each local area has a unique set of
opportunities and problems, and must develop an LED strategy (or combinations
of strategies) that is relevant to the local context.
For
example, some local areas have physical features (such as a beautiful
coastline, or close proximity to a harbour or airport), which can be used as
resources for LED. Other local areas may
draw on different resources for LED, such as money, land or infrastructure, or
a skilled workforce. Good relationships, enthusiasm and commitment are also
important resources for LED.
LED is not:
o LED is not an industrial policy. It is also not SMME
promotion, though SMME may be part of LED.
o LED is not regional planning. Planning can make an
important contribution to LED. But while there is often economic development
without anybody having planned for it, the process of planning does not secure
that there is subsequent economic dynamism.
o LED
is not community development. Community development is about solidarity – it is
about self-help groups, mutual assistance and voluntary work to help the
disadvantaged and solve health, education, housing and other problems.
LED
occurs when a local authority, business, labour, NGO’s and most importantly
individuals strive to improve their economic status by combining skills,
resources and ideas.
