Local Economic Development Network in Africa

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Why LED in Africa?

Friday 6 October 2017

Mr. François Yatta

Decentralization in Africa is evolving in a difficult economic context, a fragile institutional framework and high levels of poverty. In most countries, decentralization processes are underway and a number of tasks and responsibilities have been transferred to local governments. However, during the early phases of decentralization (1980-2005), the emphasis was rather laid on the administrative and political aspects. As from 2005, the constraints pertaining to access to employment and income generation were identified as the main obstacle to the entrenchment of decentralization and the improvement of the living conditions of the people.

The explanation for the rise in importance of LED lies in three major factors:

  • globalization which now places territory at the forefront of business strategies,
  • decentralization which provides an adequate institutional framework for territories, and
  • urbanization which brings to the fore the role of development poles of cities and their hinterland as centers of production and competitiveness.

Developing Local Economic Development (LED) strategies involves a coalition of stakeholders that have to transcend the traditional institutional boundaries (public, private and social stakeholders) and it requires research, consultation and participation. It also implies an impetus to be given from the grassroots and a project ownership of the local stakeholders in a full-scale exercise of local strategic planning.
Citizens, local governments, businesses, central governments and development partners work to draw benefits from their investment in local strategies and local economic development programs. Actually, the direct benefits of successful LED strategies affect the volume of economic activities and have a major impact on job creation and wealth distribution. If the latter two and the tax base are performing well, the local economies are perennial and competitive, and more taxes presuppose better public services; what helps to improve the infrastructural environment of businesses. If properly developed and implemented, LED is a virtuous circle that helps to attain a sustainable local development.

Better jobs and incomes, a high quality of life are the demands of all citizens, both in developing and developed countries. These demands, increasingly pressing for local governments and their officials, are legitimate and require bold LED promotion strategies at the local level. The decentralization processes give these demands a special resonance, even though fiscal decentralization is still a long way off.
A substantial share of economic activities is concentrated in Africa around micro, small and medium-sized enterprises in the formal and informal economies. A good quality infrastructural environment is an important prerequisite for the development of these activities and their competitiveness. LED is an approach whereby economic operators ensure their concerns are taken into t account for a better contribution to territorial development.

Development partners also have more than one reason to make LED one of the areas of concentration of their grants, for, it contributes to aid efficiency by encouraging local project ownership, local planning and decision-making at the grassroots local. LED also improves local governance, reduces poverty and contributes to the entrenchment of decentralization. Most LED strategies identify projects which are local priorities, not necessarily the priorities of development partners.

In this context, the objective of LEDNA is to facilitate strong and competitive local and national economies through knowledge dissemination, capacity building and development of LED practices in Africa.