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Local Economic Development (LED)

What is in this guide?

This guide summarises government policy on Local Economic Development. It has the following sections:

  1. What are the intended outcomes of LED?
  2. LED strategies for Municipalities

  1. What is local economic development?

Local economic development (LED) is seen as one of the most important ways of decreasing poverty. Local economic development must aim to create jobs by making the local economy grow.  This means that more businesses and factories should be started in the municipal area. As part of the IDP, key stakeholders in a municipality must come together to reach agreement and take decisions to make the economy grow and create income opportunities for more people, especially the poor. 

National government makes policy and provides funds, research and other support for local economic development.  Municipalities decide on LED strategies and the process of arriving at a LED strategy must be part of the Integrated Development Planning (IDP) process. 

The LED strategies should be based on the overall vision outlined in the IDP and should take into account the result of the analysis done to identify problems and prioritise development projects. It should also look at things like integrating our residential and work areas, building development corridors between areas and supporting the economy with good public transport.

National and Provincial government provides support for municipalities in developing local economic strategies

The Department of Provincial and Local Government has identified the following as key principles underlying LED:

  1. LED strategies for Municipalities

Developing an LED Strategy requires that a municipality does an analysis of the existing situation, look at opportunities for growth and decide on the best strategies to achieve their goals.

The following are some key strategies that a municipality can put in place to meet its goals:



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