In Mozambique; Local Economic Development is defined as “a strategy for employment promotion through micro and small enterprise development, support of social dialogue and development planning, whereby public-private partnerships amongst stakeholders in the local economy, including representatives of regional and local government, employers’ and workers’ organizations, Chambers of Commerce, cooperatives, producers’ associations, women organizations and other NGOs.” It is promoted to trigger sustained Local Economic Development, especially within the depressed regions such as the rural areas (van Boekel and van Empel, 2010:01).
The Local Economic Development approach promotes deliberation across stakeholders about how best to use local resources to benefit all (Van Boekel and van Empel (2010). This also gives a platform for all stakeholders to prioritize triple-developmental needs54. The stakeholders in Mozambique have used Local Economic Development Agency (LEDA) as platform to communicate and forge strategies to attain the agreed developmental goals.
This institutional model has yielded a number of positive results, such as; raising public awareness on the development needs while simultaneously assisting in the establishment of linkages at the national and international level.
3.7.1 Local Economic Development Climate in Mozambique
In Mozambique, Local Economic Development within many rural areas is being implemented through partnerships with the International Labour Organization (ILO), which is supporting the United Nations Office for Project Services (UNOPS) in carrying out and meeting its goals within the framework of the Program for Human Development at the Local level (PDHL). This program is very important in the realization of Local Economic Development within the countryside in Mozambique, since it advocates improving living and working conditions of the people.
54 This relates to the need to balance and incorporate all the elements of sustainable development (social, economic and environmental) to ensure that LED is sustainable and speaks to the needs of all classes.
The rural areas in Mozambique are faced with a number of challenges that have the potential to somewhat threaten the realization of LED in the country if they are not well negotiated. According to van Boekel and van Empel (2010) the PDHL program undertook a situational analysis in the provinces of Maputo, Manica and Safala rural region. It identified low population density as one of the challenges in these regions. This is further aggravated by the dispersion of the population leading to geographical isolation, which has negative economic and developmental implications as it escalates the cost of developing and doing business in rural areas. Their analysis also identified climatic conditions as having negative implications in many rural parts of the country. The rainy season last six months and during this time, the communication and access in these areas is almost impossible making these areas remote. This inevitable triggers low productivity due to: a lack of an efficient transportation and marketing system coupled with a lack of functional support structures of the production. High levels of illiteracy and low levels of formal education, whereby60% of the men and 95% of the women have had less than 5 years of formal schooling are also problematic (Boekel and van Empel (2010). This lack of education contributes to an additional scarcity of access to information and thus robbing the people residing within the countryside opportunities and knowledge. Van Boekel and van Empel (2010) also identified that rural areas in Mozambique completely lack formal finance mechanism, since there are no banks and formal financial institutions operational.
3.7.2 Local Economic Development Interventions in Mozambique
Stemming from the background presented above, it was than imperative for Mozambique to forge strategies to curb and solve the array of challenges that rural areas are faced with in realising Local Economic Development. The state of Mozambique through the International Labour Organization (ILO) provided a number of interventions that focus on supporting LED within rural areas. These included the following:-
Improving the support services for productive activities55;
Improving the physical working conditions of the different public support services, whereby there was a development of Business Service Centres which provides technical assistance to business starters as well as financial services through a Credit Cooperative ;
The promotion and strengthening the agricultural sector, through increasing production, providing support and marketing of the agricultural products;
Execution of SWOT an analysis, in a quest to identify local investment opportunities, while also strengthening the available local capacities (potential) and creating new ones; and,
The training of local communities and ensuring transfer of knowledge56.
The strategies used in Mozambique to stimulate LED within the depressed rural areas have had mixed results in dealing with the different challenges. However, the time frame estimated to ascertain the levels of success have not elapsed. To date the results have been promising as there has been a lot of development in dealing with the challenges hindering sustained LED within the rural areas of Mozambique. This development can to a greater or lesser degree be attributed to the establishment of the Local Economic Development Agency (LEDA), which incorporated all the affected and interested stakeholders residing within rural areas. Having given a brief synopsis of Local Economic Development within the rural areas in Mozambique, the next part of this section draws nearer to home as it focuses on the precedents of the strategy within the rural areas of South Africa.
3.8 Precedents of Local Economic Development within Rural Areas in South Africa