Local economic development, an emerging reality in sub saharan africa

5.2: Conclusion

The object of this research work seeks to find out why despite the emergence of Local Economic Development in the Republic of South Africa, localities are unable to exploit their economic resources sufficiently to enable them overcome poverty? The concept of LED in SA is relatively new in a country whose previous apartheid governments led to the disempowerment of many South Africans and the new government inherited a country that is significantly endowed with resources yet the poverty levels are so high.
The country’s LED programme is not predominantly focused on poverty alleviation as some LG’s concentrate on pro-growth which may not address poverty directly. Furthermore, the lack of a specifically designed LED policy paper aimed at addressing poverty makes LG’s to direct their scarce resources on other priority areas for their localities. Consequently, not withstanding the country’s outstanding economic position in Africa, poverty is widespread. In this research work, we cannot deny the fact that progress has been made in some of the larger cities, but in most parts of the country LG’s are dealing with unfounded mandates which lack the power, resources and capacity to implement LED so as to alleviate poverty.
The lack of securing a consistent political support for LED programmes with long yield terms as well as the need to re-align other policies with LED intention has slowed it results. For many LG’s, priority is to get the basic infrastructure in order to fascilitate LED but there are limited human resources to be injected in the programmes for better outcomes.
Theoretical explanations may not be the best way to address social problems such as poverty in society but they serve only as a guide to develop sound policies. LED policies are not consistent with the new governments’ neo-liberal thinking which is based on a free market principle. This is further compounded by the near absence of an effective monitoring and evaluation techniques to access LED ventures.
Local economic development is a multi-disciplinary field of studies that requires a comprehensive and rigorous engagement of the various disciplines in setting up LED programmes and evaluation techniques. At the same time poverty needs to be understood as a multi-dimensional phenomenon which cannot be perceived as requiring only an income evaluation solution to determine those within the poverty range. This therefore creates a complex situation to policy designers, practitioners and scholars in effectively applying LED. In a bid to tackle poverty all stakeholders need to be part of this exercise. It is an affirmed fact in this research work that the relative short period of applied LED LED could not have radically overcome poverty. Therefore poverty alleviation is a continuous process that requires relentless efforts of all stakeholders.

5.3: Perspectives

What is germane within the South African localities is that there should be a concerted effort by local authorities to incorporate LED within mainstream centres of learning and LED programmes should be well structured to allow continuous monitoring and evaluation of programmes towards poverty alleviation. Furthermore, local authorities should create a network to evaluate achievements within other municipalities and how sister councils can best impart their learned lessons to others. This should lead to a resourceful and purposeful network of experts within this domain. All stakeholders should be part of the development process and development should be seen as a continuous process which actually gives the possibility for continuity, and not just a process which ends at the mandate of each administration. By so doing local authorities will build on the knowledge and achievements of the successive administrations which will act as their strength in fostering LED and poverty alleviation. The goal is not to achieve this lofty objective overnight but through conscious efforts that give room for continuity and knowledge sharing.
It is very important to link LED to micro credit schemes because this will facilitate its growth in order to alleviate poverty. A good example is the profound experience of Nobel price winner Mohammad Yunu founder of Grameen Bank in Bangladesh. His new experience created a category of banking by granting millions of small loans to the poor people without collateral security for the establishment of businesses. He went against traditional banking principles to award loans to the poor in his effort to create economic and social development from below based on trust from those receive the loans.

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1 The Reconstruction and Development Program (RDP) was designed to improve the standards of living for the majority of the population by providing housing, basic services, education, and health care. While a specific ministry for the RDP no longer exists, a number of government ministries and offices are charged with supporting RDP and its goals.

2 Rand is the Republic of South African currency.

3 Such as Rousseau, Mill, Montesquieu and Madison