Transcript No Slide Title

Rural Economic and
Enterprise
Development: A
framework for analysis
and joint action
Bloemfontein, South Africa
25 January, 2004
Junior Davis and Felicity Proctor
Natural Resources Institute (UK)
[email protected]
[email protected]
Workshop Objectives
 Present the Rural Economic and
Enterprise Development (REED)
Framework
 Exchange relevant current and planned
project and programme experience
between practitioners and review in the
light of the REED framework
 Review the potential utility of the REED
framework in the South African context
 Consider options for follow up action
research and learning in partnership with
the NRI led programme
2
Hoped for Outputs
 Better understanding of REED as a
framework to support multi-stakeholder
processes for rural economic development
and poverty reduction
 Shared learning between South African
programme practitioners set within rural
and local economic development
 Emergence of a learning platform/network
on REED/LED to support ongoing and
future programme interventions
 Agreement on whether and how to take
forward work on the validation of REED in
the South African context and possible
future uptake
3
What is Local Economic
Development
 Local economic development is
about local people working together
to achieve sustainable economic
growth that brings economic benefits
and quality of life improvements for
all in the community. “Community” is
here defined as a city, town,
metropolitan area, or sub national
region (World Bank, 2004).
4
Three Waves of Local Economic
Development
Focus
Tools
1960s to early 1980s:
 mobile manufacturing
investment, attracting outside
investment, especially the
attraction of foreign direct
investment
 hard infrastructure investments
To achieve this regions/ government/
NGOs used:
 massive grants
 subsidized loans usually aimed at
inward investing manufacturers & tax
breaks
 subsidized hard infrastructure
investment
1980s to mid 1990s:
 the retention and growing of
existing local businesses
 still with an emphasis on
inward investment attraction,
but usually this was becoming
more targeted to specific
sectors or from certain
geographic areas
To achieve this
regions/government/NGOs provided:
 direct payments to individual
businesses
 business incubators/workspace
 advice and training for small- and
medium-sized firms & technical
support
 business start-up support
 some hard and soft infrastructure
investment
During this third (and current) wave
of LED, more focus is placed
on:
 soft infrastructure investments
 public/private partnerships
 networking and the leveraging
of private sector investments
for the public good
 highly targeted inward
investment attraction to add to
the competitive advantages of
local areas
To achieve this
regions/government/NGOs are:
 developing a holistic strategy aimed
at growing local firms & providing a
competitive local investment climate
 supporting and encouraging
networking and collaboration
 encouraging the development of
business clusters
 encouraging workforce development
and education
 closely targeting inward investment to
support cluster growth; supporting
quality of life improvements
5
Research on Local Economic
Development highlights:
 Significant role played by extensive and
established local economy clusters
 Municipal/ local government plays a key
role in impacting these economies
 Constraints are often inadequate political
decentralization and regressive urban
planning regulatory frameworks
 A purely "industrial" or “agricultural”
focus excludes:
• extensive livelihood linkages in the rural
and urban economy,
• governance aspects.
• importance of extensive trade networks
inter-connecting distinctive local
economies both rural and urban
What is REED?
 The Rural Economic and Enterprise
Development is a framework based on
the analysis of successes and
experiences of programmes and projects
by an international group of practitioners
from different professional backgrounds
and countries.
 REED framework offers a flexible tool for
joint analysis, planning, evaluation and
learning among stakeholders concerned
with rural economic and enterprise
development.
 It is an example of an holistic and spatial
approach to local, rural and urban
development.
The Evolution of REED
Joint donor initiative (GTZ, DFID, SDC,
IFAD, CTA, FAO, WB) to overcome
fragmentation
Framework developed based on success
factors of operational experience from a
diverse range of programmes (Berlin
workshop November 2002)
This was developed using the Learning
Wheel methodology.
10.
Ongoing
learning
from
success
and
failures by
all
stakeholde
9.Active
rs
participatio
n and
ownership
of
developme
nt
processes
by well
linked
stakeholder
s
8. Local
organisation
, groups and
associations
(representin
g the poor)
as building
blocks
7. Adaptive
management
capacity and
entrepreneur
ial
competence
within
business and
enterprises
1. An enabling
environment
that provides
for an attractive
investment
climate and
dynamic
entrepreneurshi
p
Fostering
Rural
Economic
and
Enterprise
Developm
ent
2. Effective
mechanisms
and
structures
that address
local needs
3. Active
private
sector
institution
s and links
4.
Functioni
ng and
effective
infrastruc
ture (hard
and soft)
5. Access
to
integrated
and open
markets
6. Access
to
effective
and
efficient
support
services
and
resources
Using REED: in the planning
process
Use of the framework in the planning
process for poverty oriented LED in rural
and urban areas
As a checklist in the planning process
As a tool to define priorities with
stakeholders and decision makers
As a guideline in participatory planning
with stakeholders
As a tool for joint planning with different
projects and donors
As resource material for the REED/LED
planning process
Using REED: in prioritising
interventions
Using the framework as a tool for selecting
amongst intervention priorities (gateway
function)
For example:
 local and regional economic
development
 promotion of value chains
 training and human resource
development
 rural and urban business development
services
 microfinance
 ....
Using REED: in monitoring &
evaluation
Use the framework for monitoring and
evaluation:
 As a guideline to establish a M & E
System
As a tool for discussions with decision
makers on changes observed
As a tool for joint evaluation of different
projects in the same region
To help define indicators for results and
impacts on different levels
As a tool to establish benchmarks for
regions and countries
The Cornerstones of Rural
Economic and Enterprise
Development framework
Each cornerstone contains
The aim of a cornerstone in the overall
context of REED/LED
Core elements of the cornerstone
Key strategies to achieve best results
Instruments and means of
implementation
Links to websites with information,
experiences and best practices
The key elements of the ten
REED Cornerstones
Cornerstone 1. An enabling environment
for an attractive investment climate and
entrepreneurship.
Good governance, improved reformed
regulation, taxation, licensing, remove tariff and
non-tariff barriers
Cornerstone 2. Effective mechanisms
and structures that address local needs.
Effective decentralisation, empowerment of
communities
Cornerstone 3. Effective private sector
institutions & links
Build capacity of private BDS, enhance
organisational capacity, create local business
networks
The key elements of the ten
REED Cornerstones
 Cornerstone 4. Functioning and effective
infrastructure (hard and soft).
 Identify infrastructure needs of rural SMEs, Providing
& maintaining required infrastructure, integrating into
wider systems, quality dimensions
 Cornerstone 5. Access to integrated and
effectively functioning markets.
 Access to markets, transparency & stability of
markets, market chain integration &
management, market development
 Cornerstone 6. Access to effective and
efficient support services and resources.
 Provide information & specialised services, Develop
market for service provision, provide contracted
business services, supply inputs, access to finance &
R&D facilities
15
The key elements of the ten
REED Cornerstones
Cornerstone 7. Adaptive management
capacity and entrepreneurial competence
within business and enterprises.
Management & organisation, production &
service generation, financing, marketing,
networking
Cornerstone 8. Local organisations,
groups and associations (representing the
poor) as building blocks.
Understand organisational arrangements,
motivate self-mobilisation, facilitate organisational
development, ensure organisational graduation to
higher and appropriate levels of formalisation
The key elements of the ten
REED Cornerstones
 Cornerstone 9. Active participation in and
ownership of joint learning processes by
well-linked stakeholders.
 Identifying stakeholders, building stakeholder
convergence, creating structured platforms & for
a for negotiations, creating networks for learning
 Cornerstone 10. Ongoing learning from
success and failure by all stakeholders
 Create platforms to share and review information,
agree vision and M&E framework, creating an
effective knowledge management system
17
Cornerstone 4. Functioning and
effective infrastructure (hard and soft).
CONTENT
Identifying the
infrastructure
required by
rural
enterprises
KEY STRATEGIES &
PROCESSES
1.
1.Assess the
existing
infrastructure and
identify gaps and
the necessary
improvements;
2.Improve access
to the infrastructure
3.Identify ways and
means to reduce
costs of accessing
the infrastructure.
1.
1.
1.Encourage public
and private
investment in
infrastructure;
1.
Development of sound
proposals for new or
improved facilities with
benefits to rural enterprise
and the public.
1.
2.Privatise state
utility service
providers;
1.
An independent regulatory
body; Invitations to tender for
management of service
delivery contracts.
1.
3.Promote local,
self-funded
facilities, e.g,
collective or
cooperative
services;
1.
Development of innovative
schemes for self-funding.
1.
4.Establish facilities
on a correct and
legal basis, e.g,
access.
1.
Investigation into the local
regulatory or legal position.
2.
3.
Providing the
required
infrastructure
POSSIBLE WAYS TO
IMPLEMENT
2.
3.
4.
Survey of existing
infrastructure and business
needs;
Identification of priorities and
contributions in multistakeholder forums;
Increase in the volume of
goods or services using the
infrastructure;
Provision of low-cost
solutions to enterprise needs.
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Scenario for using the REED
framework in an LED setting
(l)
The following steps are proposed:
l. Define geographical area (e.g., district,
province),
II. The framework could be applied to
analyse the existing situation in that area
and identify potential areas of
improvement.
III. Cornerstones, their interdependencies,
strengths and gaps could be identified by
detailed analysis and self-assessment.
Scenario for using the REED
framework in an LED setting
(ll)
IV. The gaps or shortcomings blocking the
exploitation of the economic potential
of the region should be analysed in
detail and prioritised by their negative
effects on the system.
V.
Factors with the greatest negative
impact should be addressed through
intervention.
VI. Once the possible interventions are
identified, implementation strategies
can be planned and the roles of the
different actors and their mutual
expectations can be clarified.
How REED can add value
1. Thinking about economic and livelihood
strategies to compliment other spatial
planning and management efforts is
new. Critical linkages which combine
to direct resources and interventions
strategically and spatially need to be
considered.
2. Public administrations should
conceptualize REED/LED strategies in
a trans-locational (village, small towns,
cities) perspective, including its
institutional setting and prioritise
according to cost effectiveness and
socio-economic impact.
3. REED provides a common platform
and mechanism to link policy,
procedures and interventions from a
multidisciplinary perspective.
NRI Action research and
shared learning on REED

The research aims to develop further the
conceptual framework and project tool
for the fostering of rural economic and
enterprise development in South Africa
and Bangladesh

In pursuit of this, the project aims to:
 Apply the REED framework and share
emerging practice on pro-poor public
policy and institutional support at local
and national government levels
 Refine and develop the conceptual
framework so that it can address gaps in
the framework
Approach
Collaboration with In-country
partners
Collaboration with UK and EU
partners
Consultation with key
stakeholders
Policy and Institutional focus
Policy dialogue
Methodological issues
Study site selection criteria
Unit of analysis
Quantitative and Qualitative
Research
Methodologies and tools
Issue(s)/Purpose
Potential Methodological Tool(s)
Assessment of community
physical/natural assets
Participatory Resource Mapping
Secondary data on economy,
employment and demography
Exploration of local resources and
development conditions
Transect walks
Focus group discussions
Understanding of different SME
and MSME activities
Focus group discussions
Gaining in-depth knowledge of
specific issues, structures and
organizations
Key informant discussions
In-depth interviews and
Institutional audits
Following up and illustrating
specific issues
Case studies – semi structured
interviews
Stakeholder perceptions, attitudes,
meanings and values (social
assets)
Impact of sectoral policy
frameworks on LED
Focus group workshops semistructured interviews
Information on the factors that
constrain poor’s access to
employment and SME
development.
Identification of needs for the
development of the LED
Empirical analysis of secondary
data
Case studies – SAM/PAM
HH survey/ secondary data/
questionnaire/ Enterprise
questionnaire
Focus group discussions, Key
informant discussion, enterprise
QNR
Policy uptake and
dissemination
Stakeholder involvement and
shared learning platform at in
South Africa and Bangladesh
Input into DFID, World Bank
and EU programme and
investment processes
Published Outputs and Website
Networking
Seminars and Workshops
Thanks for your
attention!
For related reports see:
The Natural Resources Institute
website
http://www.nri.org/projects/reed