REGIONAL TERRITORIAL DEVELOPMENT

1
REGIONAL (TERRITORIAL) DEVELOPMENT

• SOME LESSONS FROM THE
• LATIN AMERICAN EXPERIENCE

2
Key Concepts / Definitions

• Regional Policy
• Regional Policies
• Territorial Development
• Considerations
• Context
• Entry Points

3
PERU AND ECUADOR

• Peru
• Good Macro-economic environment
• High levels of inequality
• High social risks
• High diversity
• Quality of Life

4
Ecuador

• Specific Province (Chimborazo)
• Strong Leadership
• Support from Central Government
• Law of Fiscal Responsibility infrastructure
  investments

5
TERRITORIAL DEVELOPMENT AND DECENTRALIZATION

• Peru Decentralization Law of 2002 gave the
  Regions (departments) full responsibility for
  economic development.
  
• Pilot activities were designed to facilitate the
  implementation of the new law and test different
  models of economic development (PROCUENCA,
  FONCODES)
• Decentralization presented several challenges
  fiscal issues, competencies at each level of
  government, assessment of local capacity,
  mechanisms for promoting economic development.
• Along with macro-level policies (e.g. a rigorous
  system of public investment monitoring), the
  territorial approach was introduced in selected
  regions as a mechanism to facilitate
  decentralization.
• In Bolivia and Ecuador, decentralization was
  already underway.
  
• Different approaches to respond to different
  circumstances.
  

6
INSTITUTIONAL CHALLENGES

• How to integrate existing sectoral programs with
  a new strategy?
  
• How to finance the new strategies? Fiscal Issues
• Who should lead? The Central Government, Regional
  Government? Municipalities?
  
• What programmatic and project mechanisms should
  be used?
  
• How could it be implemented?
• How should it be monitored?

7
THE TERRITORIAL APPROACH OFFERED THE BEST OPTION
WHY

• It provided a framework to establish investments
  priorities taking into account the economic,
  social, cultural and physical assets of a
  particular territory.
• It promoted multi-sectorial collaboration.- An
  effective use of public and private resources was
  best achieved when national programs supported a
  clear and well-defined strategy.
• It helped bring discipline to public investments
  based on a strategic economic plan and taking
  advantage of economies of scale.
  

8
THE TERRITORIAL APPROACH WHY ?

• It helped promote social cohesion by involving
  local stakeholders and promoting local alliances,
  building a consensus on the future of the area.
  
• It helped strengthen local identity improving the
  possibility of retaining potential immigrants.
  
• It provided the basis for more effective decision
  making and greater institutional accountability.
  

9
WHAT PROCESS WAS FOLLOWED

• Identifying territorial or regional typologies
  through territorial analysis In Peru, the areas
  selected were those with the highest impact from
  the violence of the 80s, in Ecuador, a province
  with a diverse geographic composition of i)
  territories with dynamic agricultural and
  agro-industrial entrepreneurial activity ii)
  micro-regions with dynamic small family-based
  productive units iii) areas of extensive
  agriculture iv) depressed rural areas. In
  Bolivia, areas with economic potentia (clusters
  of municipalities)
• Starting with Regional Strategic Planning as
  the instrument for economic coordination and
  efficient investment plans.
  
• Finding the appropriate entry point e.g.,
  infrastructure (Ecuador) rural alliances (Peru
  and Bolivia) information technology
  (Extremadura) tourism (Calabria, Northern Spain).

10
WHAT PROCESS WAS FOLLOWED?

• Strengthening or building local and middle-level
  institutions (governance) e.g. Local Action
  Groups (Leader-EU) FUMACs (Brasil) Rural
  Development Councils (Mexico, Brasil) Mesas de
  Concertacion (Peru) Joined Municipalities
  (mancomunidades-Bolivia) Cluster Advisory
  Councils (Ecuador, Colombia), MOUs
• Promoting Partnerships- e.g., establishing
  incentives to form associations among the public,
  private and civil society sectors.
  
• Making use of local assets natural, social,
  cultural, physical, economic, demographic.
  

11
KEY LESSONS LEARNED SO FAR..

• A Multi-sectorial approach works best at the
  local level the most successful cooperation
  across sectors was achieved at the local level,
  when there was a clear strategy for development
  and consensus a vision of the future.
• Clarification of roles at each level of
  government was central multiple and sometimes
  overlapping responsibilities and competencies of
  different levels of government present a
  challenge
• The Central Government role - responsible for
  regulating, coordinating, facilitating and
  monitoring program implementation.
  
• The Regional and Municipal Governments role -
  responsible for promoting and providing public
  goods type of services e.g., facilitating the
  participatory process for economic strategies and
  economic alliances, providing intraregional
  infrastructure, information, environmental
  management and related services.

12
.LESSONS LEARNED SO FAR.

• Establishing a competitive financing mechanism
  with clear eligibility criteria for co-financing
  strategic investments (rules of the game)-
  
• The demographic and geographic diversity of a
  region may call for different eligibility
  criteria for different types of investment
  programs. For example in Peru, the Territorial
  Development Fund would have three windows, each
  with its own selection criteria and targeted to
  different segments of the population.
• i) to promote agricultural diversification and
  reduce malnutrition
  
• ii) for producer associations in alliance with
  the private sector, NGOs, academic institutions
  
• iii) for regional level programs with alliances
  between local governments and other partners, e.g
  municipalities, local communities and local NGOs
  to establish appropriate environmental management
  interventions.

13
. LESSONS LEARNED

• Promoting partnerships and productive alliances
  for implementation of key strategic economic
  activities that would enhance the quality of life
  and economic productivity of the area and would
  promote the development of a local market of
  services.
• Impact of the Territorial Approach depends on the
  level of political commitment of the actors
  involved. Developing consensus on key strategic
  areas of action, establishing clear rules of the
  game, providing timely information, allocating
  resources accordingly and showing early success
  are key for the overall impact of the regional
  strategy.
• Regional/Territorial Development is still
  evolving in Latin America. It is work in
  progress.