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Pro-poor interventions for LED

The case for sectoral targetingChris Rogerson - 19 November 2002

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Paper structure

Overview of key debates and trends internationally

Pro-poor LED in South Africa Pro-poor LED: The case of Johannesburg -

selective targeting The case of urban agriculture The case of the clothing industry The case of Tourism

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Overview

Apparent convergence - LED interventionsFour leading edges competitiveness of localities, growth through property-led city improvements ‘job creation from the inside’ - business

retention and SMME support Community development support - community

enterprises or cooperatives

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Overview

Divergence Anti-poverty measures are rarely the central

focus of LED in the developed world Poverty alleviation is higher on the agenda in

the developing world

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Overview

Spectrum of LED interventions - market led (pro-growth) to market critical (pro-poor)

Market led - adjusting to macro-economic reforms

Market critical - bottom up approach aimed at self reliance, empowerment, participation, local cooperation and environmental sustainability

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Pro-poor LED in Cities

Municipalities well placed to undertake long-term planning in poverty alleviation Regulatory frameworks (laws and regulations

related to town planning, public health, building and land development)

Access to municipal services Employment creation (attracting new

investment, support for informal economy, labour-based public employment)

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LED in South Africa

Characterised by three waves Pro-growth, market led (late 80s and early 90s) Augmented by focus on business retention and

local business support

First two waves led at the local level Pro-poor focus as DPLG has taken the lead

mandate for LED policy formation

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Emerging policy

LED linked to developmental local government Attempts to balance competitiveness with

poverty alleviation and job creation Focus on state-society relations New and reformed inter-government relations Includes both market-led and market critical

aspects Anchored on service delivery and supporting

subsidies

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The case of Johannesburg

Refers to 2030 document - and in particular the endorsement of targeted or selected sectoral interventions as a methodology

Analysis of sector’s attractiveness and competitiveness (GGP, employment growth and multiplier effects)

In Jhb, high skill and knowledge based services sectors emerge as the most competitive and attractive using this criteria

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The case of Johannesburg

Argues the case for a similar methodology with a focus on poverty alleviation

The selection methodology for a targeted pro-poor LED might focus instead on the relative

attractiveness of sectors in terms of measures of labour intensity or skill levels and the degree to

which sectors provide substantial livelihood opportunities for the most vulnerable or core

groups of the urban poor

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Urban agriculture

Rationale food security easy in, easy out entrepreneurship (income) gender opportunities (and other vulnerable gps) community focus - inclusive public health spin-offs

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Urban agriculture

Midrand case-study Ivory park Food security Goes beyond survivalist activities - part of a

strategy to be an eco-city Could become more formalised - Organic market Absence of a coordinated set of policy

interventions cause for concern

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Clothing industry

Not prioritised in terms of current methodology Decline in the sector driven by:

• high wages

• apartheid legislation

• low productivity

• focus on low-end of the clothing market

• resistance to change

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Clothing industry

Largest industrial sector in the inner city Growth in informal manufacturing (largely

Black owned) Majority of these entrepreneurs are women Sector enjoys little support - although some

support from Johannesburg Development Agency

Would benefit from selective targeting approach

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Pro-poor tourism

3 broad areas MICE (Meetings, Incentives, Conferences,

Exhibitions) Regional retail tourism Cultural tourism

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Pro-poor tourism

Labour intensive Provides opportunities across various skills

levels Can provide low-skill opportunities with

appropriate training Spin-offs via affirmative procurement,

outsourcing, subcontracting

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Conclusion

The key argument proposed in this analysis is that sectoral targeting can be deployed usefully to support the crystallisation of

pro-poor urban LED interventions