Municipalities decide on LED strategies and the process of arriving at a LED strategy must be part of the integrated development planning (IDP) process. Local economic development must aim to create jobs by making the local economy grow. This means that more businesses and factories should be started in the municipality.

As part of the IDP, people in a municipality must come together to reach agreement and take decisions to make the economy grow and create income opportunities for more people, especially the poor.

The LED strategies should be based on the overall vision outlined in the IDP and should take into account the result of the analysis phase. It should also look at things like integrating our residential and work areas, building development corridors between areas and supporting the economy with good public transport.

Key principles underlying Local Economic Development include:

• Making job creation and poverty alleviation a priority in any LED strategy
• Targeting previously disadvantaged people, marginalized communities and geographical regions, black economic empowerment enterprises and supporting SMMEs to allow them to participate fully in local economies
• Promoting local ownership, community involvement, local leadership and joint decision-making
• Involving local, national and international partnerships between communities, businesses and government to solve problems, create joint business ventures and build local areas
• Using local resources and skills
• Integrating diverse economic initiatives in a comprehensive approach to local development
• Applying flexible approaches to respond to changing conditions