Question

Judging at the current situation in SA, some LED initiatives implemented by municipalities did not yield intended results, now, how or what can be done in terms of strategies that can be applied to address the ff matters effectively in local municipalities:
Poverty Alleviation;
Unemployment;
Industrial development;
Graduation of the informal sector;
Fundraising for LED initiatives

Answer 1

Introduction: LED initiatives is nothing but the Local Economic Development (LED). It is an approach towards economic development. It allows and encourages local people to work together to achieve sustainable economic growth and development. As result to bring economic benefits and improved quality of life for all residents in a local municipal area.

Strategies for Local Economic Development (LED):

LED is intended to maximize the economic potential of all municipal localities throughout the country and, to enhance the resilience of the macro-economic growth through increased local economic growth, employment creation and development initiatives within the context of sustainable development. The “local” in economic development points to the fact that the political jurisdiction at a local level is often the most appropriate place for economic intervention as it carries alongside it the accountability and legitimacy of a democratically elected body.

LED provides support in the following areas:

• Development and review of national policy, strategy and guidelines on LED;
• Providing direct and hands-on support to provincial and local government;
• Management of the Local Economic Development Fund;
• Management and Technical Support to Nodal Economic Development Planning;
• Facilitating coordinating and monitoring of donor programmes, and
• Assisting on LED capacity building processes.

Poverty Alleviation: Poverty Alleviation is one of the important tasksfor the Local Economic Development (LED). It has globally grown into locality-based responses to the challenges of globalization, devolution, local level opportunities and crises. International bodies such as the World Bank, Organization for Economic Co-corporation and Development (OECD), and a host of national governments have embraced LED. Within the OECD, LED is particularly endorsed for urban development and business promotion The South African government has considerably embraced LED in its policies and strategies. To this end, LED has emerged as an integral part of a new wider emphasis upon local responsibility and power on the democratization of daily.

Unemployment: The most important ways of decreasing poverty. Local economic development must aim to create jobs by making the local economy grow. Poverty and unemployment are the main challenges facing South Africa. Local economic development (LED) is a multi-dimensional and multi-sectoral process through which the skills, resources and ideas of local stakeholders are combined to stimulate local economies to respond innovatively to changes in the national and global economic environment to attain as an end result, job creation, poverty alleviation and the redistribution of wealth.

            In the South African context, LED is seen as being important for the following reasons, namely, creation of jobs and new employment opportunities; increasing income levels, thereby enabling people to pay for services; broadening the tax and revenue base of a municipality; improved municipal services and facilities; development of human resources; building new institutions for sustainable development; and linking the developed and underdeveloped areas

Industrial development: Local economic development, industrial policy should have to development in South Africa a critical reflection on three new policy frameworks. ... A central assumption in this regard is that a level of coherence in policy prescriptions is necessary for effective and complementary implementation.

Graduation of the Informal Sector: Informal sector is increasingly being recognized for its contribution local development particularly poverty reduction and employment creation. Focusing on the informal sector is increasingly becoming a crucial element in the success of local economic development (LED) strategies. Indeed, LED provides a major opportunity for localities to improve the local economic growth and the performance of the informal sector. Typically, LED strategies and assessments of local economies should also incorporate the needs of the informal sector.

Fundraising for LED initiatives: Fundraising to support key vital areas such as small business and medium business. The alignment of LED initiatives with the state’s macro-economic strategic plans is crucial in order to enable local economic activities to compete on a global level as well as to promote the role of the private sector and decrease state involvement in the economy. Therefore, local resources should be used to enhance local development that meets national and global economic standards. Local small and medium business enterprises are encouraged to adopt techniques and methods that are compatible with the global economy.