A runaway success

2010-04-09 00:00

BY all accounts, Gijima KZN, a partnership between the European Union (EU) and the KwaZulu-Natal provincial government aimed at stimulating local economic development (LED), has been an overwhelming success.

The project, which boasted total EU funding of about 37 million euros, resulted in the creation of about 4 200 jobs over the past six years.

In the process, hundreds of millions of rands have been pumped into the provincial economy and scores of disadvantaged people, many from rural areas, have been touched by the project.

In terms of its structure, the programme consists of LED funding and technical assistance mechanisms.

They include the Business Enabling Fund (BEF), the Local Competitiveness Fund (LCF), Networking and Co-operation Funding (NCF) and technical assistance.

The LCF has been critical to the success of the Gijima KZN project at a grass-roots level.

This aspect of Gijima KZN stipulates that partnerships should be created between business enterprises, trade unions, nongovernmental organisations, institutions providing services to the economy, legally established community entities, finance institutions, and government stakeholders.

According to Gijima KZN, the primary emphasis of the LCF was to encourage partnerships which facilitate private sector investment in sustainable local economic development projects — projects that provide jobs and a sustainable income for citizens of KwaZulu-Natal.

Partners received up to 70% funding of the project’s value (or a maximum of about R3,7 million) through the LCF’s implementation wing. The remaining 30% of the required funding had to be sourced from elsewhere, with Gijima KZN offering project applicant assistance in securing this funding from a variety of private and public sources.

Apart from the more tangible benefits, the project has also demonstrated that partnerships between different stakeholders in the economy — such as business enterprises and rural communities — can work.

For example, a partnership would have been created between a business owner and a community group.

Although many Gijima KZN- funded projects are agriculture-related (sugar cane, essential oils, indigenous medicine), other projects range from small-scale manufacturing to arts and craft, tourism, media and information technology.

The legacy Gijima KZN leaves behind in the province is significant.

The provincial government’s LED capacity in KwaZulu-Natal in 2003 was very limited, with only three staff members and a R2-million budget.

Following Gijima KZN, the Department of Economic Development and Tourism can now boast an LED unit with a staff of 21 and a budget of more than R60 million per annum.

Apart from the fact that the culture of LED is now firmly entrenched within the government of the province, Gijima KZN has also exposed government stakeholders at provincial and local level to important systems and materials aimed at managing LED in a more efficient manner.

The result has been the creation of strong LED institutions across several government departments.

The aim of the initiative was to create jobs through viable, long-term projects.

PROJECT Gateway is based in the Old Prison in Pietermaritzburg and is now a centre for several church-based projects.

These projects help local people who have previously earned little, to develop and sell products such as curios and craft items to local and international wholesale and retail markets.

Gijima KZN provided a grant of R860 426 to assist Project Gateway. This money directly contributed to the creation of jobs and livelihoods for 107 people. The impact of helping one producer in a community to earn an income, indirectly impacts on 10 adults and children around them, and has therefore directly and indirectly impacted on thousands of people.

LEAP — Local Economic Action Partnership for socially and economically excluded groups in the Richmond and Mkhambathini areas.

Leap is a microfinance project which promotes the development of savings and credit groups in poor rural areas around Richmond and Pietermaritzburg. It also involves enterprise training and development. It was led by two NGOs — SaveAct and the Project Preparation Trust.

The project received almost R1,3 million in Gijima KZN funding and established savings and credit groups for over 1 260 people, trained 80 emerging entrepreneurs and established over 60 organic vegetable gardens, which resulted in the establishment of two vegetable seed nurseries to supply the organic food gardens. The project also linked pepper growers in Inhlazuka and Inkumane to a local exporter who bought their crop and has agreed to continue doing so.

THE Noodsburg Cane Growers Association formed a partnership with three small cane-growing co-operatives in Swayimane. The intention was to increase production at the local sugar mill at the same time as generating sustainable income for local small growers

Using a grant of R3,8 million, the project reclaimed land and planted, fertilised and maintained 288 hectares of sugar cane, generating 186 jobs in the process, and providing livelihoods and income to small growers, while increasing the volume of sugar being produced by the mill.

This is a partnership model between the sugar industry and small growers which has been applied very successfully elsewhere in the province. 


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