LOCAL ECONOMIC DEVELOPMENT FOR AN INCLUSIVE AND SUSTAINABLE DEVELOPMENT IN ETHIOPIA: CHALLENGES AND OPPORTUNITIES

Local economic development (LED) is one of the development frameworks that enable and encourage stakeholder participation, including the private and public sectors, within defined geographical boundaries, empowering the joint design and implementation of community-based, locally accepted development strategies by utilizing local resources and comparative advantage in the global context. The final objective of the local economic development strategy is to create decent job opportunities to benefit local people and stimulate local economic activity, which is the basis for regional development and stability. The crucial element of local economic development is its focus on applying indigenous knowledge, techniques, and policies to harness the potential of local people, institutions, and resources. Ethiopia has been practicing local economic development since 2009 in different phases, with a focus on its potential for eradicating poverty in rural areas. Therefore, this paper aimed to investigate the challenges and prospects of LED during its implementation and subsequent practices in Ethiopia, in line with examining the genesis, theoretical and empirical background, and the rationales for LED policy, strategies, approaches, actors, frameworks, etc., both generally and specifically in Ethiopia. Methodologically, the research used critical secondary data source reviews. Accordingly, the possible opportunities for implementation, along with their applications and challenges from different perspectives, such as policy, actors (including local people), financial and technical areas, and administrative values, were carefully reviewed.