Online Discussion Synopsis

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2nd World Forum of Local Economic Development Governance for Local Economic Development

Online Discussion Synopsis

Governance for Local Economic Development Moderated by UNDP

“A key challenge is to reshape the nature of local economic growth to achieve goals of sustainable development.” – Kishan Khoday* This paper reviews the results of an open query posted on UNDP Teamworks between July and October 2013 aimed at taking stock of successful experiences and good practices in promoting local economic development (LED). The query process aimed to stimulate a broad, multi-stakeholder dialogue informing policymakers at all levels through feeding into the II World Forum of Local Economic Development in Brazil. LED practitioners and stakeholders from a wide range of organizations participated in the query, indicating a keen interest in the topic in the lead up to the Forum. Key lessons learned and conclusions related to LED governance, capacity development, and its interface with sustainable human development are summarized below. Governance for LED The emergent understanding of LED as a strategically planned, locally driven partnership process indicates that governance considerations are an integral dimension of LED. The success of LED outcomes in areas such as employment creation, poverty reduction, sustainable livelihoods, and environmental sustainability depends on the quality and effectiveness of local administration; the inclusiveness, transparency, and accountability of local policy making procedures; and the degree to which principles of justice and equity shape

how power and authority are exercised at the local level. The contributions to the query delineated a number of key features of effective governance for LED. Adaptability: That LED policies and institutions have been adopted and delivered on desired outcomes in diverse country settings—from Albania and Ecuador to El Salvador and Mozambique—attests to the flexibility of the model. Governance for LED does not depend on pre-determined statutory structures with a legally established representation and mandate. Rather, it should be based on careful context assessments and consultation with key stakeholders. Integrated, multi-level: The integration of LED governance institutions with national and decentralized policy and institutional frameworks is a crucial determinant of its relevance and impact. LED practitioners in El Salvador, for example, found that clearly establishing the legal and functional relationship between the Ministry of Economy and the LEDA, “La Union”, was a prerequisite for effectively coordinating support for SME’s and promoting job growth. Centrality of local governments: “If I am in Sengerema and you ask me why the market fails, one of my answers will be local government. It is their duty to understand market failures and find ways to remedy them. The question is do local governments have the capacity to carry this function?” – Daimu S. Mkwawa The query dialogue underscored that local governments are key actors that need to be included at all decision-making levels to promote LED. Local governments with clear

*All quotations from query contributers, UNDP Teamworks, June-October 2013 DISCLAIMER: The findings, interpretations, and conclusions expressed in this discussion summary are those of the discussion participants and do not necessarily reflect the policies or views of UNDP, the United Nations, or the participants’ organizations.


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Online Discussion Synopsis by UNDP ART Initiative - Issuu