Combining Value Chain Development and Local Economic Development

Value Chain Development (VCD) and LED approaches can reinforce each other. Both are approaches that address the “how to” of private sector development and that can be designed to include the poor in the resulting benefits. VCD seeks to enhance the functioning of the market system by analyzing it and devising interventions to overcome bottlenecks and constraints in the chain. LED strategies identify the economic potential of a specific territory and empower local economic actors to take joint action for economic growth and job creation. By combining the approaches possible shortcomings of each single way of doing things can be avoided. This paper explores how this combination can be done in an effective way.