Regional Economic Development
[ Last Updated 27 July 2007 ]
Introduction
An innovative economy is essential for New Zealand's growth and prosperity. This will ultimately be driven by the business sector in the form of productivity increases and global competitiveness.
Regions have a key role to play in boosting the quality of the local business environment for their own growth and that of the national economy.
A strong strategic direction is key to harnessing the region's resources for this purpose. When undertaken effectively, strategic planning is a mechanism for the region to:
- define its own future;
- assemble information relevant to its economic development;
- understand and develop ideas about its economic potential;
- communicate its intentions to the regional community and beyond;
- organise, engage and involve regional stakeholders;
- determine priorities and specific actions to implement the strategy; and
- link to and align with other strategies relevant to the region.
These guidelines map out how regions can undertake effective strategic planning and are intended for use by experienced and new economic development practitioners or anyone with an interest in this area. A strategic planning framework is presented that is based on seven phases. This framework is supplemented with various New Zealand and international case studies that provide examples as to how the phases have been applied in a range of regional contexts. Working out what is best for your region will involve a combination of strategic planning practice, learning from others' innovative and useful "real life" experiences and application.
Overview
Why Is Strategic Planning Necessary?
Regions already have experience in formulating economic strategies and MED has produced these guidelines to contribute to the continual development of high quality strategies and their implementation. Strategies can always be improved whatever the context they are formulated in, especially since regions exist in a dynamic environment. Strategic planning usually occurs as an ongoing cycle of activity in order to respond to changing circumstances and new opportunities.
Why Take a Regional Approach?
The regional approach complements national level policy initiatives. While it is important that national policy settings encourage business development, the regional level can be thought of as the "sharp end" where the economic activity actually occurs. There are many factors that influence economic development that can be specific to a region or locality:
- most economic activity is based on capital and labour inputs that may be location-dependent, meaning that economic activity is firmly linked to a "place" and is affected by the regional environment within which the "place" is located;
- the assets and potential of one region may vary considerably from another and regions must identify their unique strengths in order to maximise their opportunities;and
- critical mass is achieved more easily at the regional or combined regional level because of spatial proximity.
What Factors Affect Growth at the Regional Level?
The environment that a firm operates in ('the business environment') is comprised of many social, technological, economic and political factors. Some of these factors operate at a national level (for example interest rates), while others have a more localised influence (for example access to broadband).
The regional business environment framework is one way of understanding the factors that have the biggest influence on firm growth.
How Do You Make This Happen?
The strategic planning process provides opportunities to:
- establish networks and linkages involving all the significant regional actors and stakeholders;
- use the strategic planning process to communicate, engage, and motivate the regional community; and
- identify and develop capabilities to enhance the region's economic potential.
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