Transcript Empowering Municipalities on LED

SESSION 3:
‘Empowering Municipalities to deal with
Economic Development’
- Dudley Adolf
Director: Economic Development
Department of Economic Development
Western Cape Province
4 March 2004
IDP Conference 2004
“Developmental Governance in Action”
CONTENT
Background
Ideal Situation
Current Situation
Possible Solutions
The Way forward
Background
Clause 152 (1) (Constitution of RSA)
“The objects of local government are(c) To promote social and economic development”
Clause 153 (Constitution of RSA)
“A municipality must –
(a) promote the social and economic development
of the community
(b) participate in national and provincial
development programmes
Ideally…
Economic development should be
Sustainable outcome based on local initiative
and driven by local stakeholders
Involves local ideas, innovations, resources
and skills to stimulate growth
Aim is to create employment opportunities,
alleviate poverty and improve the living
standard and quality of life of all residents
Ideally… it should be based on
Shared vision based on a
comprehensive strategic plan
Critical mass of resources to promote/
manage the LED-process
Effective organisational structure
Close co-operation with the National &
Provincial Government and District
Municipalities
Currently there is ...
Weak institutional support for economic
development
Lack of baseline information leading to
poor plans
Insufficient focus and institutional
readiness
Unclear mandates creating overlaps and
duplication
Currently ...
IDP and Economic Development ?
“The IDP process to date indicated the lack of
understanding and capacity within local
authorities, to deal with LED issues and
responsibilities”
- DPLG (2002)
How do we move forward to
create growing towns and regions?
A few facts we need to consider …
Key fact 1
Economic Development requires resources
and assets
Human
– capacity for basic labour, skills and
good health
Physical
– access to infrastructure
Natural
- land
Financial
– savings and access to credit (grants)
Social
– networks of contacts
Key fact 2
Efforts to address past and current social
inequalities should focus on people not places.
In localities where there are both high levels of
poverty and development potential, this could
include fixed capital investment beyond basic
services to exploit the potential
In localities with low development potential,
government spending, beyond basic services,
should focus on providing transfer, human
resource development and labour market
intelligence.
Mobility to choose places that are likely to provide
sustainable employment or other economic
opportunities
Key fact 3
Spending by government is likely to be more effective if
aligned with social, environmental and economic trends in
your area
Economic growth is most likely to continue where it has
previously occurred, and therefore economic potential is the
highest in these localities
Even in localities with unexploited potential (natural resource
endowment, human resources and forward-backward
linkages to other economic processes),
such potential can only be unlocked if linked to primary
centres of economic growth.
Research indicates that primary growth centres provide the
human, financial and institutional resources necessary to
develop the under exploited potential of other localities
(see National Spatial Development Perspective)
What now …
It is important to have an accurate description
of you area as it currently exist.
A baseline profile of the cities economy that
allows you to isolate the drivers of you economy
and the resistors
Simplicity is the key …..
Resisting forces
leading to
deterioration
ASSET BASE
Drivers leading
to improvement
Human Assets
– labour, skills and
good health
Fact 1
Fact 3
Physical Assets
– access to infrastructure
Natural assets
- such as land
Financial assets
– tax base, savings and
access to credit (grant’s)
Social Assets
- networks of contacts,
common or shared vision,
social integration
Fact 2
Sector potential...
GROWTH SECTORS
EQUITY
SMME
CLOTHING
&
TEXTILES
AGRI
CULTURE
OIL
AND
GAS
BIO
TECH
CMT
AGRO
PROCESS
LINK
PROCURE
MENT
?
?
BEE
MONATIC
JV’S
DOWN
STREAM
ENGINEERING
IDP/LED
ATLANTIS
MICHELLS
PLAIN
TARGET
AREAS
WEST
COAST
?
HRD
DESIGN
ELSEN
BURG
METALS
?
potential
Or …
NO
Potential
SECTOR
Business
sophistication
Formal Informal Market
Business opportun
-ities
Technical Empower Marketing
sales,
skills
-ment
delivery,
(product &
service
service)
Human
resource
mngt &
dev.
Demand and
Supply
D
R
D
R
D
R
D
R
D
R
D
R
D
R
Globally
Competitive
Firms
+
+
+
+
+
+/-
+
+/-
+
+
+
+
+
+
Growthorientated
+
+
+
+
+
+/-
+
+/-
+
-
+
-
+
-
Emerging/
stable firms
+
-
+
-
+
-
+
-
-
-
-
-
-
+
Survivalist/
necessity
entrepreneurs
+
-
-
-
+
-
-
-
-
-
-
-
-
-
BUSINESS ANALYSIS...
FINANCE SUPPLY:
TRADITIONAL OR
DEVELOPMENTAL
PROCESSING RELATED
EMPOWERMENT ON FARMS
D = Driver
R = Resistor
Growth, employment
Transforming Leadership
ASSET
BASE
Diminishing Barriers
Becoming a better place
Believing we are worth it
Desired outcomes, targets,
methodologies
Macro Context
NATIONAL
PROVINCIAL
Micro-economic Strategy
Provincial Growth & Development Strategy
URBAN RENEWAL
GROWTH & DEV SUMMIT
RURAL DEVELOPMENT
Metro & Districts
Social Infrastructure
IDP
LED
Economic Base
Basic Services
CONCLUSION
Way forward is a Structure or Function to
address the following in a region:
Maintain economic baseline information
Maintain awareness of any economic
opportunities or threats
Awareness of existing state law, policy,
legislation & investments
Access point for information and a
distribution point to service municipalities,
provincial and national departments,
agencies and the private sector