Engines to local economic development

A HEAVY burden was placed on the corporate shoulders of our local authorities when President Mnangagwa in his inaugural address this week described them as engines for economic growth.

“Economic development at every level is the ultimate goal. I therefore challenge local authorities in the Second Republic, to be the engines of local economic development and growth. My Government will not stand by and watch people suffer due to dereliction of duty, corruption or incompetence within our local authorities.” (President Mnangagwa during his inauguration speech — August 26, 2018).

All eyes are now on our municipal authorities (whether they are urban councils, rural district councils or local boards), to deliver high quality services — no doubt dressed in their newly fashioned servant leadership garb. It won’t be easy, especially given the challenges they have faced in the past, not least of which include: funding limitations, infrastructure maintenance backlogs, and institutional capacity limitations.

The first challenge for Local authorities is to make significant structural adjustments in order to reduce their recurrent spending and balance their budgets, while prioritising development activities. While there are signs that economic recovery is on its way, it remains an urgency for local authorities to execute their role in stimulating economic development.

Through proper planning, Zimbabwean local authorities can ensure that services are directed where they are needed the most, with appropriate cost recovery mechanisms and revenue generation initiatives. Local authorities can also make full use of the Special Economic Zones Act’s provisions to contribute to the awakening giant that is Zimbabwe.

Local Governments are the chief providers of a business friendly and investor tolerant environment in which enterprises can grow sustainably. Municipalities are the custodians of most physical infrastructure (i.e. roads, water supply, and waste management etc.), which are the foundation for economic development. They are also responsible of public welfare issues (i.e. health, employment, education, housing, local transportation services, cultural and recreational facilities), and other public goods and services that are essential to nurturing a healthy, skilled, and reliable workforce.

Many countries have undertaken decentralisation programmes, devolving to the local scale responsibility for economic development in their jurisdictions as they have realised that it is the scale at which people create partnerships, alliances, find synergies and complementaries for mutual support, and ultimately craft strategies relevant to the particular needs of their community. In many cases, however, this process of decentralisation is incomplete, as Local Governments do not have clear strategic plans that define their objectives towards economic development and other resources (human and financial) required to accomplish such.

The detrimental consequences for many Local Authorities across Africa, including Zimbabwe, have been extremely stretched resources and accordingly neglect of duty in service delivers that encompass refuse collection; water reticulation; road maintenance; and housing development issues. Limited resources only act as barriers to the effectiveness of Local Authorities as engines or catalysts of economic development. To achieve economic development originating from a local level, Local Governments must establish strategic plans that provide clear objectives in the field of local economic development and ensure that their employees have the training and the financial resources required to execute their duties.

In light of the above, Zimbabwe’s local authorities require organisational development support specifically in the following areas:

Resource Mobilisation — Comprehensive Resource Needs Assessments should be carried out. Cash resources (reserves, surplus and current funds) are essential to maintain municipal and rural district operations. Municipalities and rural districts must balance investment risk against potential investment returns while still meeting the daily cash flow demands of the Local Government. Strategic Planning & Performance Management — GGF can support local authorities in the identification of strategic and performance gaps. Stakeholder need assessments should be carried out with the help of experts who can facilitate interviews, workshops and focus group and enable the crafting of their vision, mission, values, goals, and resources planning with full reference to local economic development.

Rapid Capacity Building — Local Governments must conduct training needs assessments and accordingly assess the current pool of skills, measure skills gap and define interventions to bridge the identified skills gap. Internal Systems Documentation & Automation — Municipalities are in dire need of organisational re-design exercises, business process re-engineering, internal control systems analysis and documentation, in accordance to best operating and manufacturing practice. A systems intervention of this magnitude ensures that the proposed strategies are aligned with the internal control systems.

Local Governments must ensure that their local economic development strategic plans, and initiatives are well coordinated and developed within the framework of country development policies that take into account the local cultural context and national priorities. Local Authorities must ensure the voices of the people are heard by promoting participatory processes in their approaches to economic development.

This article was compiled by Lisa-Rufaro Marowa and Rufaro Mhuka, transformational strategists and resource mobilisation consultants at Genesis Global Finance. The contents herein are for information purposes only, and GGF does not accept responsibility for any loss arising from the use of materials or opinions contained in this article. To contact Genesis Global Finance: Call us on: +2638644131515 or +263777352828; Like us facebook: genesisglobalfinance/privatelimited; Follow us on Twitter: @ggfafrica; LinkedIn: /in/genesis-global-finance-166908a3/