3.8 Precedents of Local Economic Development within Rural Areas in South Africa . 78
3.11.1 Lessons from Amathole District Municipality Case Studies in the Eastern Cape
3.11 “AMALINDA FISH FARM IN AMATHOLE DISTRICT MUNICIPALITY”
The Amalinda Fish Farm project is a micro fish farming venture that deals specifically with
“growing and selling fresh water crayfish (Marron) and Koifish”(E.C-LED, 2010) . This project has benefited from the existing local infrastructure, since it uses facilities of the Fish Research Station located within the Amalinda Nature Reserve. The project specialises in various fields, such as; the “upgrading the existing infrastructure, rehabilitating dams, building, hatching and fencing, stock breeding and fish farming, training on managing small businesses, environmental awareness, Marron and Koi fish farming and marketing” (E.C-LED, 2010). The project has created various job opportunities for locals, especially women and the youth. There are approximately thirty permanent jobs that have been created by the Amalinda Fish Farm Enterprise.
Plate 3: Marron and Koi Fish
Source: Eastern Cape Local Economic Development Information Booklet (2010).
3.11.1 Lessons from Amathole District Municipality Case Studies in the Eastern Cape
long term sustainability. A milestone has been achieved by the Amathole District Municipality in terms of its priorities for supporting Local Economic Development. Other municipalities in the province and elsewhere in the country can learn from the municipality.
Although this municipality has achieved a great deal, it could have achieved far better results if it had addressed a number of issues that inhibit adequate Local Economic Development results.
The main inhibiting factors that limit the success of Local Economic Development in the province are mainly structural, administrative and planning. Cohen (2010) confirms this point, arguing that 26 of the 45 municipalities in the Eastern Cape have had not completed Local Economic Development strategies, which must be aligned to the overarching LED framework of their Integrated Development Plan. Furthermore, 56% of the municipalities in 2009 were reported to have no Local Economic Development Managers. Consequently, this speaks to the need to improve and develop implementation capacity to improve the quality of the processes and plans for Local Economic Development in the province. Bond (1998) argues that the most fundamental problem hindering Local Economic Development in the province and elsewhere is lack or inadequate delivery of basic municipal services. This is a critical component of Local Economic Development upon which the future of socio- economic rests72.
3.12 PRECEDENTS FOR LOCAL ECONOMIC DEVELOPMENT IN KWAZULU-NATAL: THE CASE OF UMTSHEZI
MUNICIPALITY
Umtshezi Local Municipality is located in Northern KwaZulu-Natal. It forms part of the greater UThukela District Municipality. Umtshezi Local Municipality is bordered by three local municipalities; Ladysmith, Indaka, and Ukhahlamba. The map below provides a visual representation of the locality of Umtshezi Local Municipality.
72 See Bond, P (1998): Local Economic Development and the Municipal Service Crisis in Post- Apartheid South Africa: The Case of Stutterheim ;Urban Forum (9) 2.
Source: htpp://www.google. led.co.za
Umtshezi Municipality, like its’ sister municipalities in the province of KwaZulu-Natal (KZ-N) is faced with a number of challenges which if not dealt with adequately, will continue to hinder sustained Local Economic Development especially in rural areas. According to the Umtshezi-LED-Strategy (2007) poverty and unemployment rates in Umtshezi have increased, with the economy not being able to absorb the increasing number of people entering the labour force. The municipalities’ inability to create and provide job opportunities has directly exacerbated the rate of poverty, as the both increased unemployment and increased poverty are correlated. The latter is also echoed by the Development Bank (2005) which states that employment73 is the best protection against poverty. The economy of Umtshezi Local Municipality, like the large proportion of South Africa, is still resting upon three sectors agriculture, manufacturing and trade. These are the sectors that have traditionally been the pillar of the country’s economy and still continue to play an integral role in the economy to date.
According to Umtshezi-LED-Strategy (2007) these three sectors differ in their forecast in terms of potential growth, challenges, and the future of employment demand. The manufacturing and agri-processing sectors have experienced a number of challenges that have directly caused it to decline, however they still remain important sectors. Despite the manufacturing sector being well established historically, of late it has experienced a steady decline with a number of large firms closing down. These closures are similar to other regions in the province where the sector has declined tremendously, due to the negative impact of globalisation. The agricultural sector is the only sector amongst the three that has indicated signs of stability in terms of employment. However, there are two challenges that threaten the future of this sector. These are the continued dependency on traditional crops and products with very little innovation or value addition and the issue of the possible impacts of land reform (Umtshezi-LED-Strategy, 2007).
The three sectors discussed previously have an impact on the formal economy of the municipality; however they have failed to make a more meaningful impact on the informal economy. For this reason, a high rate of people about seventy five percent (75%) in the Umtshezi Local Municipality are involved in the informal economy and thus are vulnerable to
73 Employment can be defined as a job or an income generating activity.
the high rate of poverty prevalent in the area. The manner in which the informal economy is negotiated in the municipality is pivotal for the realization of sustained Local Economic Development especially in the rural areas. Thus, the approach to achieving Local Economic Development in the countryside should be holistic. It has to ensure that both the informal and formal economy is equally supported, with the former given more attention due to the high number of people dependent upon it.
3.12.1 The Approach and Strategies of Local Economic Development in the Umtshezi