For the SDC, local economic development is not just an economic matter but a cooperative approach which provides an excellent tool for bringing together different interest groups to agree on local cooperation that can help create jobs and income, in addition to improving governance.

SDC focus

Moreover, local economic development can also strengthen governance at national level. In countries like Kosovo or Burkina Faso, the SDC conducts local economic development activities which have been implemented simultaneously in several towns. This has enabled municipalities (or rather territories, because each town has close links with its peri-urban and rural hinterland) to exchange information and experience that are specific to them. This has led to better cooperation among local authorities and thus added weight to the local dimension in dialogue with central government.

Background

Local economic development brings together various stakeholders from civil society, as well as the public and private sectors. Its goal is to promote cooperation so as to develop a given area. Cooperation is a key factor in governance. Local economic development (LED) triggers a political process in which the protagonists have to negotiate the priorities bearing in mind the limited human and financial resources at their disposal.

Forces that drive the economy

Economic considerations drive the private sector. Cooperation on creating public goods, such as improved framework conditions for investment, calls for a private-public collaboration that is built into concrete projects ("We'll build the road, and you'll build the factory. You tell us what's not right about the investment climate, and we'll put it right."). In this way, combined LED efforts create new business prospects. The public sector needs the private sector for local economic development.

In virtually every country, it is the private sector that creates most jobs and generates income, and jobs and income are a priority for the public sector's customers and voters. Poverty reduction and – perhaps more important for a civil servant – re-election of the mayor and his staff depend on the generation of income.

Governance as a process

Civil society, like local associations, should also be part of planning and implementing development projects in which the economic dimension is obviously not the only issue at stake. The State and local government do not cover all the ground. So the three stakeholder groups – the public and private sectors and civil society – negotiate and cooperate on the basis of concrete information derived from evaluating the strengths and weaknesses of the local economy, as well as the opportunities and risks involved. This dynamic exchange between partners improves governance at local level.

Current projects

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Europe and Central Asia : PPP Transaction Advisory Program

01.06.2011 - 31.12.2022

The ECA Program, managed by the International Finance Corporation IFC, is providing infrastructure transaction advisory and capacity building services to the public sector authorities to promote Public-Private Partnerships in Southeastern Europe and Central Asia.


Scaling-up Renewable Energy Program in Low Income Countries (SREP)

01.01.2010 - 31.12.2028

The Scaling-Up Renewable Energy in Low Income Countries Program (SREP) of the Climate Investment Funds is empowering countries to transform their economies by demonstrating the viability of renewable energy to increase energy access and economic opportunities. SREP financing is channeled through five multilateral development banks (MDBs).


Dam Safety Monitoring and Rockfall protection, Phase III

01.01.2010 - 31.12.2023

The overall objective of the Contribution is to assist the competent Albanian Institutions and the Albanian Power Corporation KESH in raising the safety of the dams at Drin and Mat River Cascades to European standards.


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The project aims at supporting financial stability in Peru by strengthening the country's financial regulatory and supervisory framework, promoting efficient consumer protection practices and supporting the implementation of a national anti-money laundering - combating the financing of terrorism strategy. It further aspires to encourage financial inclusion by creating a favorable legal framework conducive to the development of new financial products and increasing financial literacy of existing and potential customers. The direct beneficiaries of this program are Superintendencia de Bancos y Seguros (SBS) and regulated stakeholders, including financial intermediaries, private pension managers and insurance companies. The indirect beneficiaries are the public in general an final services consumers in particular.

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