Thus, this dissertation has sought to break down the barriers to sustainable local economic development within the village. These factors, among others, have been found to be the most profound in preventing the realization of sustainable local economic development within the Umzumbe-Phungashe sub-region located in the southern part of KwaZulu-Natal province.
B ACKGROUND TO THE P ROBLEM
Local Economic Development (LED) is among the many initiatives announced by the government as a plan to address and eradicate the challenges facing rural areas. Against this backdrop of failed government policies and new strategies, this study attempts to remove barriers to sustainable local rural economic development while creating more innovative domestic solutions to the problems facing rural areas.
P ROBLEM S TATEMENT
However, despite these initiatives aimed at promoting sustainable local rural economic development (RLED)1, to date no project or program has achieved the optimal result or realized the intended potential rate. The failure of rural local economic development (RLED) is seen as the direct failure of a country to eradicate high levels of poverty, illiteracy, unemployment, infrastructural backwardness and dependency (Pemberton and Goodwin, 2010b and Rogerson.
T HE R ATIONALE FOR THE S TUDY
Research has shown that in many cases these imported tools and strategies are not necessarily suitable for achieving successful implementation in developing areas. Without a clear understanding of the specific local factors that make an area unique, generalized RLED strategies are bound to fail because they do not address these factors directly.
The study challenges the orthodox production of knowledge to solve problems simply by adopting foreign tools and strategies intended to promote RLED, even though they may not be the most suitable for operating in the local environment. A modernist one-tool-fits-all approach to problems has proven inadequate in addressing many societal problems such as poverty alleviation, crime, substance abuse, and RLEDs, among others.
R ESEARCH Q UESTION AND S UB -Q UESTIONS
H YPOTHESIS
T HE S TRUCTURE OF THE R ESEARCH
Second, it provides an overview of the theoretical and conceptual framework used in the research process. The final section of this chapter provides a discussion of the local challenges that hinder the achievement of sustained LED in rural areas.
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Our vision for the development of rural areas stems from the fact that people in rural areas have the right to basic needs, moreover they have the right to electricity, water, toilets with water, roads, entertainment and sports centers. They have the right to have shopping malls, good schools and other facilities like their countrymen in urban areas…”.
I NTRODUCTION
In view of the above, legislation and policy guidelines, the South African government and various supporting stakeholders have adopted and invested resources in an effort to develop rural areas, through the promotion of LED. Recent empirical research, conducted by both government and private practitioners, has shown that although the development of rural areas is part of the national development agenda, they remain largely underdeveloped.
L OCAL E CONOMIC D EVELOPMENT C ONTEXT
However, this can only be a success if different actors5, such as businesses, civil society organizations and government, are encouraged to work together to promote Local Economic Development. International experience suggests that for LED to be successful, private-public partnerships should be encouraged at local, regional and global levels and all energies should be used to promote and support initiatives that develop the local area.
D EMYSTIFYING L OCAL E CONOMIC D EVELOPMENT -“M ULTIPLE D EFINITIONS D ILEMMA ”
This expectation paradoxically offers local government a new challenge and opportunity to transform the lives of local communities for the better. For local government to be successful in seizing this opportunity and creating more futuristic local economies, private and public partnerships must be created (Davis, 2006).
D EFINING L OCAL E CONOMIC D EVELOPMENT
2006) argue that the LED approach is spatially effective regardless of geographical location whether in urban, suburban and rural areas. However, LED can be broadly defined as an approach that promotes the collaboration of local residents with various stakeholders from both the public and private sectors by using local resources to provide sustainable opportunities that will help in eradicating the challenges posed by underdevelopment and poverty is stated.
A F RAMEWORK FOR L OCAL E CONOMIC D EVELOPMENT
- Organizing Efforts
- Local Economic Assessment
- Strategy Making
- Strategy Implementation
- A Strategy Review
Objectives Based on the overall vision and specify desired outcomes of the financial planning process. The implementation of the LED strategy is usually achieved through the formation of a private-public partnership (PPPs), which is strongly driven by the local authority (World Bank 2003).
A PPROACHES TO L OCAL E CONOMIC D EVELOPMENT
- Traditional Approach
- Entrepreneurial-Competitive Approach
- Urban and Rural Efficiency Approach
- Human Resource Development Approach
- Community-Based Approaches
- Progressive Approaches
Human capital, empowerment and skills development are the key pillars of this approach, which is seen as a crucial element for sustaining local economic development. They are all looking for a method to provide a more sustainable path to achieving local economic development.
- Postmodernism
- Deconstruction -An Epistemological Approach to Debunking Barriers Hindering
- Ruralisation, Rurality and Re-imagining Rural
- Reframing Development -Dialectics of Under Development and Redevelopment
In some cases, their solutions have exacerbated problems on the continent, causing more suffering for the poor, especially those in rural areas. The latter is a critical factor in realizing the thesis of initiating sustainable economic development in rural areas.
L EGISLATION AND P OLICY F RAMEWORK G UIDING LED IN R URAL A REAS
- The Constitution of the Republic of South Africa (1996)
- The White Paper on Local Government of 1998
- The Municipal Systems Act: No. 32 of 2000
- A Quest towards a Comprehensive Local Economic Development Policy
The following section provides an overview of the National Framework for Local Economic Development in South Africa (2006). Local economic development is one of the five Key Performance Areas (KPA) identified for evaluating the performance of local government.
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This is a departure from previous policy documents and guidelines that have advocated for an intrusive rather than facilitative engagement with stakeholders in the development of Local Economic Development. The concept of 'new institutionalism' echoes through the framework and forms the primary approach to achieving Local Economic Development.
I NTRODUCTION
A B ACKGROUND TO G LOBALISATION
Proponents argue that it is both a "natural" and inevitable result of technological progress, creating positive economic and political convergences - while its critics argue that it is hegemonic and antagonistic to local and national economies.
U N - PACKING G LOBALISATION
Defining Globalisation
Palmer (2002) suggests that globalization is the reduction or elimination of coercive restrictions on exchange across borders and the increasingly integrated and complex global system of production and exchange that has emerged as a result. Fotopoulos 1990 (cited in Hopper, 2007) argues that globalization is the result of systemic trends that manifest the market economy in terms of a "grow-or-die dynamic", which is then followed by the rapid expansion of transnational corporations.
G LOBALISATION F RAMEWORK
Their main thesis is that globalization is not new and that the processes that are considered and identified as new under. Hopkins (2006) writes that skeptics argue that globalization is unequal, thereby exacerbating social polarization and inequality.
T HE F ORCES OF G LOBALISATION
The next section will discuss the various forces of globalization that shape the world and directly or indirectly affect the development goals of different regions. Secondary forces of globalization such as (WTO) International Telecommunication Agreement (ITA) World Trade Organization (WTO) and Trade Aspects of Intellectual Property (TRIPS) are also increasing the momentum of this phenomenon.
P RECEDENTS OF L OCAL E CONOMIC D EVELOPMENT WITHIN THE C OUNTRYSIDE
- International Level
- Local Economic Development within Latin America: Case of Colombia
- Rationale for the Adoption of LED in Colombia
- Strategies to Achieving Sustained LED within the Countryside in Colombia
- European Cases of Local Economic Development - A Theoretical Perspective
- The Rationale for Local Economic Development in European Countries
- Tourism - A Local Economic Development Strategy in Wales
After discussing some of the main forces of globalization, the next section seeks to discuss the precedents of local economic development at the global level. Rodríguez-Pose and Tijmstra (2005) argue that local economic development strategies originate in high-income northern countries.
P RECEDENTS OF LED IN A FRICA : A C ASE OF M OZAMBIQUE
Local Economic Development Climate in Mozambique
This program is very important in the realization of Local Economic Development within the village in Mozambique, as it protects the improvement of people's living and working conditions. Their analysis also identified climatic conditions as having negative implications in many rural parts of the country.
Local Economic Development Interventions in Mozambique
The strategies used in Mozambique to stimulate LED in the stressed rural areas have had mixed results in dealing with the various challenges. Having provided a brief synopsis of local economic development in rural Mozambique, the next part of this section comes closer to home as it focuses on the antecedents of the strategy in rural South Africa.
Precedents of Local Economic Development within Rural Areas in South Africa . 78
- Strategies towards Achieving Sustained Local Economic Development in the Free
- Challenges and Lessons of Local Economic Development in the Free State
- The State of Local Economic Development in Eastern Cape
- Some Reflections on Local Economic Development Projects
- Lessons from Amathole District Municipality Case Studies in the Eastern Cape
- The Approach and Strategies of Local Economic Development in the Umtshezi
Table: 2 below provides a summary of some of the projects that the Local Economic Development Unit has been involved with in the Eastern Cape. Consequently, this speaks to the need to improve and develop implementation capacity to improve the quality of the processes and plans for Local Economy Development in the province.
SUMMARY OF CHAPTER
The issue of access to finance for entrepreneurs without collateral is one of the main challenges.
I NTRODUCTION
Q UANTITATIVE V ERSUS Q UALITATIVE : C OMPLEMENT
It is for these broad reasons that the researcher used qualitative methods to guide the bulk of the research. They provided an enabling environment for the deconstruction of the factors that hinder sustained Local Economic Development within the countryside.
S AMPLING T ECHNIQUES
Random Sampling
Random sampling is characterized by a high degree of equality and transparency, as everyone in the population has an equal chance of being included in the sample. The total sample population for the study was fifty people; of the total, ten community members were involved in the pilot study and another ten people from the interviews.
Purposive Sampling
In random sampling, each member of the population is given a number and a random sample is chosen (Burton). However, in a quest to ensure that the research is monitored and that the people involved in the research are well informed about the evolution of Local Economic Development in the area, they must have at least ten years in the area lived.
D ATA C OLLECTION I NSTRUMENTS
The number of respondents interviewed was limited to some extent by time and limited budget. They have a number of advantages and have consequently been used in a large number of studies.
I NTERVIEWS
This will increase the reliability of the primary data that is extracted and can thus be used to inform productive sustainable decision-making, since the data sources from which the information is derived are reliable (Lindlof and Taylor, 2008). Burton (2000) argues that questionnaires have a number of advantages as they are easy to analyse, data entry and tabulation for almost all surveys can be easily done with many computer software packages81.
D ATA S OURCES
The data collected and used during the post-completion phase of the study will be stored on a disk and given to the School of Engineering and Development Studies, where it will be kept for a period of five years and then destroyed. Dissemination of the research findings was also ensured as the researcher will go back to the community and present the findings and email a copy of the study to anyone with access to such facilities.
D ATA A NALYSIS
The latter approach was also used as a way to analyze data and ensure that the efforts of the research were successfully achieved. The table below provides a summary of the different ways used to synthesize the research in the analysis of qualitative data.
L IMITATIONS
Figures (pictures, maps, etc.) Provides evidence and freezes time-Comparison of different figures taken at different times allows the researcher to ascertain the differences that have occurred spatially; and,.
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CHAPTER FIVE: PLANNING AND STATUS OF LOCAL ECONOMIC DEVELOPMENT IN UMZUMBE-PHUNGASHE SUB REGION.
I NTRODUCTION
B ACKGROUND TO THE C ASE S TUDY
Map 2 below shows the location of the study within the host municipality, namely Umzumbe Local Municipality. 85 The Umzumbe-Phungashe sub-region falls under the Umzumbe Local Municipality, a “newly created Category B municipality consisting of an amalgamation of parts of three sub-regions of the former Ugu Regional Council”.
G EOGRAPHIC L OCATION , E NVIRONMENT AND L AND U SE
This perspective to achieve local rural economic development is evident in the case of Phungashe. The latter was found to be one of the factors hindering sustainable local rural economic development in the Umzumbe Phungashe sub-region.
S ITUATIONAL A NALYSIS
Overview of Socio-Economic Analysis
92 The low level of education in the municipality is representative of the entire country, which can be attributed to the high percentage of teenage dropouts from school due to teenage pregnancies and juvenile delinquency. 93 The increase in the number of people dependent on government social grants can also be attributed to an increase in the number of orphans and child-headed households due to the high incidence of HIV/AIDS pandemic in the municipality.
Demographic Profile
In addition, the Umzumbe-Phungashe sub-region is an ideal example because it is one of the rural areas where the government has invested heavily in efforts to promote sustainable LED over the past decade. In essence, the challenges facing the Umzumba Phungashe sub-region cannot be fully understood without a clear understanding of the impact of South Africa's historical heritage on it.
Community Facilities
The map below paints a clear picture of the distribution of services and facilities in the area. There are a number of cases where community facilities have become dead assets within the area, due to some of the reasons discussed above.
P RESSING S OCIO -E CONOMIC C HALLENGES IN U MZUMBE P HUNGASHE S UB -R EGION
- Juvenile Delinquency
- Poverty and High Unemployment Rate
- Inadequate Quality Schools and Skills Training Centre
- Backlog in Basic Service Delivery
- Inadequate Delivery of Water Services
- Electricity and Energy
- Transportation Networks (Roads)
The Department of Transport argues that this is one of the reasons for the poor quality of roads in many rural areas. The two images of access roads below are an illustration of the poor quality of access roads in the area.
L IMITED F INANCIAL S ERVICES
The people in the area have also been victims of unregulated illegal credit agencies charging them exorbitant interest rates. Much remains to be done to ensure that the people in the area have access to diverse financial institutions within a reasonable distance than their urban counterparts.
I NTRODUCTION
C USTODIANS OF R URAL L OCAL E CONOMIC D EVELOPMENT
The bar graph below, Figure 2 represents the age profile of respondents involved in the study. The deconstruction of factors that hinder sustained Local Economic Development within the countryside is a complex process and requires a level of skill representative in the survey group.
D ECONSTRUCTING L OCAL E CONOMIC D EVELOPMENT WITHIN R URAL A REAS
P ERCEPTIONS AND V IEWS FROM THE I NSIDERS
Various definitions, views and perceptions also emerged during the deconstruction of what Rural Local Economic Development means. Community Survey (2012)115 they defined Rural Local Economic Development as an "initiative by the government to ensure that the communities in rural areas participate and benefit from the economy of the country".
C USTODIANS OF R URAL L OCAL E CONOMIC D EVELOPMENT
Rogerson (1997) supports the perspective of non-governmental organizations playing an essential role in achieving local economic development in rural areas. This claim is a manifestation of the role that communities can play in promoting local economic development in rural areas.
D EMYSTIFYING S ALIENT F ACTORS C ONTRIBUTING TO THE S LOW R ATE OF L OCAL E CONOMIC
Perceived Salient Factors Hindering Sustained LED within the Countryside
This can also be attributed to the lack of; political will, skills and expertise in the field of Local Economic Development in rural areas. Many reasons for the slow pace of Local Economic Development within the village allude to the factors highlighted in the latter.
T HE C ORRELATION BETWEEN THE S LOW R ATE OF LED AND I NADEQUATE P LANNING
The Planners Role in Transforming Local Economic Development Landscape in
Planners can draw up urban layout plans to be used when allocating communal land, argues the community survey (2012). Their expertise in the field of spatial planning can help combat the inhibiting factor of development in sprawling rural areas, which has been.
S TRATEGIES TO A LLEVIATE H INDERING F ACTORS AND P ROMOTE L OCAL E CONOMIC D EVELOPMENT
The lack of financial support and its inaccessibility is also another factor that hinders the realization of LED in the area. The entrepreneurs operating in the area hinted that they do not have funds to grow their businesses.
However, they have also argued that agriculture in the area can be part of the ingredients towards stimulating Local Economic Development, but is not the primary answer and solution. Unstable weather patterns have also been identified as one of the reasons for declining support and practice of agriculture in the area.
E FFECTS OF C LIMATE C HANGE IN R URAL A REAS E NDEAVOURS TO A CHIEVE S USTAINED LED
Recurring severe floods in this area are one of the indicators of the effects of climate change. The combination of all the identified effects of climate change in this area directly affects the economy, among other things.
D UAL E FFECT OF THE T HESIS OF G LOBALISATION WITHIN THE C OUNTRYSIDE
It has also led to the construction of a number of cottage developments for foreigners and non-residents working in the area for rent141. The dark side of globalization in the area has been evident in a number of ways.
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In many cases these people have no place of residence and it is expensive for them to travel back and seek shelter in the nearby city. The infiltration of foreign nationals into the area, particularly from Ethiopia, Zimbabwe and China has adversely affected a number of small businesses and entrepreneurs.
I NTRODUCTION
A B RIEF D ECONSTRUCTION OF H INDERING F ACTORS TO L OCAL E CONOMIC D EVELOPMENT IN THE
The findings also indicated that the lack of knowledge about the prerequisite drivers of local economic development among the people who make and direct decisions hinders LED efforts in the areas. The factors highlighted above are not exhaustive, but are some of the key factors that have been identified as hindering local economic development in the area.
P ATH TO A LLEVIATING H INDERING F ACTORS IN A Q UEST TO P ROMOTE L OCAL E CONOMIC
Streamlining the process of accessing government funds for rural residents was also identified as a strategy that could stimulate local economic development in the area146. The development of a business district in the area has also been identified as a strategy that could have a positive impact on boosting local economic development.
S YNOPTICALLY M APPING THE F ACTORS THAT MAKE E STABLISHED BUSINESS R ELUCTANT TO I NVEST IN
Entrepreneurs who do business in this area hinted at the fact that they lack funds to grow their business, and because of their level of education, they cannot prepare business proposals for the bank to finance their business, nor do they have insurance that the banks would retain. too much. After all, the establishment of a business district has the potential to directly address the challenge of lack of or inadequate business space for entrepreneurs, which has made many investors reluctant to invest in this rural area.
R ECOMMENDATIONS
Profits generated by projects, entrepreneurs and other stakeholders in the area should be defined as positive change and not just in monetary value. Things like tenders in the area should be awarded to community members and not outside companies.
C ONCLUDING R EMARKS
Bond, P., (1998): Local Economic Development and the Municipal Services Crisis in Post-apartheid South Africa: the case of Stutterheim. The Hexagon of Local Economic Development and LED in South Africa, meso-partner working paper No.
Interview Questions
Community Survey Questionnaire
Ethical Clearance
