What are the different types of economic development initiatives?

Creating an attractive business climate can involve improving infrastructure.

Economic development initiatives are efforts to improve the economy and standard of living of its residents in an area. Communities, states and entire nations do this by taking initiatives to improve infrastructure, education and work skills, health and safety, environmental quality and the area’s ability to compete with its neighbors on these issues. While economic development initiatives tend to have similar goals, the methods used to achieve these goals must be tailored to a specific area. Implementation plans for economic development initiatives should also consider long-term goals, because such development tends to be time-consuming.

Long-term economic development initiatives can work in an attempt to get rid of social problems in the community.

Among the various economic development initiatives are those that aim to improve a country’s human resources, focusing on education and professional training opportunities. These initiatives would examine the number of students in primary, secondary and tertiary education and would aim to increase the number of students in full-time education, starting at the primary level. This type of initiative would aim to increase the resources available to educators, such as school buildings, other facilities and textbooks. Another factor in this policy would be the training of extra teachers to take on the task. A human resources strategy can also involve initiatives to improve sanitation and health to ensure that the country’s population is fit for work.

The development of a region’s economy may involve the construction of new commercial spaces.

Alternative economic development initiatives that can be undertaken in parallel with a human resources strategy may involve the acquisition or development of technology to make industry and agriculture more efficient. This can be achieved by purchasing relevant technology from abroad or by encouraging technology transfer from foreign companies. The country could create conditions such as tax breaks or favorable free trade zones for foreign business and include additional tax breaks when technology transfer is part of the contract. Foreign companies may be encouraged to form partnerships with local companies that involve some technology transfer, or the strategy may involve countertrade and compensation whereby the foreign company fulfills additional contracts for the country.

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Another type of development strategy involves developing relevant political and economic institutions to create an enabling environment for business. These political institutions can aim to bring about social stability and a stronger legal system capable of defending the right to private property and the right of companies to defend the ownership of assets, including intellectual property. Economic institutions like the central bank could be given the powers needed to oversee the economy and create a viable banking system. International negotiations can aim to reduce tariff barriers and ensure that foreign companies are protected from asset expropriation or double taxation.

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