The use of strategic partnerships as the driver of local economic development (LED) : a case study of the eThekwini Municipality and Shanduka Black Umbrellas (SBU) partnership.

Abstract

This research examines the use of strategic partnerships or public-private partnerships (PPPs) as a driver of Local Economic Development (LED). The main objective of this study was to understand the role of partnerships in SMME related LED, to understand the effectiveness of the partnership between the eThekwini municipality and Shanduka Black Umbrellas (SBU) on SMME related LED. The specific goals were to determine the role of LED partnerships in creating employment and developing skills for SMMEs and to examine the level of sustainability of LED partnerships using the case of the eThekwini Municipality and SBU partnerships. The objectives of the study were operationalized within the broad Public-Private Partnership (PPP) discourse. This framework gave currency to the study in that in South Africa PPPs are legislated and used by all the three spheres of government. The study premises from the fact that eThekwini municipality entered into a plethora of strategic partnerships (PPPs) with a number of private sector companies with the purpose of promoting SMMEs and LED with the SBU forming part of the private sector stakeholders. The dissertation then looked at the role played by the partnership between the eThekwini Municipality and the SBU in LED. The study used qualitative research method where in depth interviews were conducted among participants consisting of senior managers drawn from the eThekwini Municipality and the SBU and six beneficiaries from the SBU. The study found that public-private partnerships do play a key pivotal role in LED and therefore recommends more public-private partnerships. Relationships provide support to SMMEs and SMMEs gain from the programs that are derived from relationships. The study also found that partnerships grow SMME turnover and help in instilling confidence. SMMEs grow and gain strength from partnerships. Partnerships also provide job creation and provide business support. The study also found that partnerships provide capacity building, business linkages, skills development and other LED related benefits to SMMEs.