UNDP recently assessed 126 of its local development projects in 22 European and CIS countries to understand what assets could be used for moving to a new stage of local development. In this new stage, local development objectives should encompass collective action for judicious use of natural and other resources and developing human capital (from basic education to management skills and entrepreneurial abilities) to the goals of adequate service delivery, maintaining cultural heritage and environmental assets, and creating sustainable livelihoods.

Compared to other regions, the CIS context for local development is particularly challenging because, prior to the 1990s, there was no recent tradition of democracy or market economy. This has implications for what can be done in a certain timeframe. Social capital constituting entrepreneurs, active communities, trust between communities and local governments, confidence of local governments, and member associations are some of the essential elements for transitioning to the next stage of development.

UNDP assistance in this region has created these missing elements through support to SMEs and other income-generating activities, and participatory decision-making, particularly in micro-projects. The micro-projects have addressed critical service delivery needs through small infrastructure investments, often with matching contributions from beneficiary communities. To UNDP’s credit, the projects have been customized to the particular local contexts; project staff members have built a rapport with local stakeholders.

Achievements included improvements in service delivery and basic infrastructure, and a greater understanding on the part of local officials of the need to include the community in budget and investment decisions. Another result is a stronger capacity of local governments in terms of efficiency and accountability. Collectively these achievements form a base for moving forward.

The pilot legacy

In many cases, however, communities or local governments cannot sustain initiatives begun under UNDP projects because they do not have the needed resources (human, technical, financial, physical) and they are unable to attract non-donor resources. The metaphorical chicken gets fed, but the area around it cannot support it in the future. In practice, scalability or replication rarely happens; many beneficiaries seem to have the problem of sustaining their own achievements through time and as processes clearly embedded in the dynamics of their development.

The assessment found that these projects typically focused on a particular municipality or set of municipalities, without creating institutional, financial, and/or economic links for supporting these initiatives. The most common stakeholder was the local government (75 percent of projects). Less than one third of the projects simultaneously engaged stakeholders at levels above and below local governments, such as district or regional governmental agencies, local civil society organizations or business associations.

Much of UNDP’s work has been with small, rural municipalities that have little hope of moving beyond donor assistance if they remain isolated from the economic dynamics of the region in which they are located. Do municipalities have knowledge of labour and product market trends in nearby areas? Can they benefit from more sophisticated human and technical resources in neighbouring municipalities, e.g., for monitoring land degradation, delivering services, or processing agricultural produce? In the new stage of local development, there must be a concentrated effort on connecting them to resources in other municipalities as well as public and private institutions at the meso and national level.

Projects employing the value chain approach (such as regional aid for trade projects in Central Asia and a value chain employment project in Bosnia and Herzegovina) make this connection through private sector actors. However, they do not always involve relevant government counterparts that could support with infrastructure, resource conservation strategies, or agricultural extension services. Several Western Balkan countries have employed inter-municipal cooperation tools to create meso-level conditions for achieving economies of scale not possible at lower levels. Inter-municipal cooperation connects local governments, but can also involve private sector actors via concessions or contracting out of services.