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GREAT insights Magazine

EU’s new thinking on decentralisation and territorial development

June 2015

Rodríguez, J. 2015. EU's new thinking on decentralisation and territorial development. GREAT insights Magazine, Volume 4, Issue 4. June/July 2015.

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How the EU is going about recognising the developmental role of local authorities as expressions of local political constituencies in a given territory and supporting decentralisation as an instrument for better results.

The European Commission’s Communication on Empowering Local Authorities in partner countries for enhanced governance and more effective development outcomes, adopted in May 2013, identifies a wide range of proposals to implement the decentralisation agenda, including the promotion of local development through a territorial approach. Although the concept of territorial development is not new, there is confusion as to what it actually means and how it can be effectively supported.

Notions of territorial development

The concept of territorial development is not new, yet it is receiving growing attention from policy-makers, practitioners, researchers and donors. Many factors contribute to this, including (i) processes of rapid urbanisation across the globe; (ii) the high social and political costs associated with uneven development (e.g. raising inequalities, conflicts, etc.) as well as (iii) the limits of traditional, top-down and centralised approaches to development. Yet the track record of implementing territorial approaches has so far been mixed. Efforts to promote spatially oriented and horizontally coordinated development within a given territory are often based on unrealistic premises or slip into a ‘hyper-local’ perspective. They have often paid insufficient attention to the essentially endogenous nature of local development or to the role of territory as an active ingredient, not a passive receptacle of development.

Against this framework, the European Commission’s Directorate-General for International Cooperation and Development (DEVCO B2) has launched a brainstorming process intended to clarify the concept of Territorial Approach to Local Development (TALD), its building blocks as well as the main opportunities and challenges to promote it through the thematic program and EC bilateral support (see Box 1).

But, how do we define TALD?

There is a consensus on the need to explore the potential of TALD processes, driven by local actors, underpinned by strong local economies, coordinated by autonomous and accountable local authorities and strengthened by effective linkages with the wider intergovernmental system. These are seen to be a much more promising vehicle to ensure a link between decentralisation and development outcomes.


When considering the notion of a TALD, it is important to understanding the word ‘local’ not just as the designation of a particular scale (‘where’ development takes place) but of a focus on ‘how’ and ‘by whom’ development is promoted. The ‘how’ question refers to the need to mobilise the potential and resources within the territory through enabling political and institutional mechanisms of governance and administration at different levels. The ‘who’ question stresses both the importance of empowered local authorities (to facilitate territorial approaches), the genuine participation of all relevant actors in a given territory, and the existence of effective relations between different levels of governance.

Integrating these new elements brings along an extended notion of territorial development as spatially coordinated local development that leverages the interaction of actors operating at multiple scales of development planning and administration. Based on the above definition of territorial development it is possible to identify the key dimensions of a territorial approach to local development including:

1.   The endogeneity of local development (which implies empowering local authorities with the autonomy needed to reach out to a wide range of local actors, mobilise and leverage local resources).

2.   The integrated nature of local development (amongst others to overcome sectoral fragmentation of development interventions).

3.   The multi-scalar nature of local development (requiring effective mechanisms of dialogue, negotiation and collaboration of different actors at different levels).

4.   The incremental value of local development on the condition that local actors have the space and capacity to develop own initiatives (through adequate decentralisation policies) and mobilise additional local

Building blocks to local development

In order to ensure a virtuous circle between decentralisation and development, there is a need for a clear national policy for local development. Such a national policy has several dimensions or building blocks. First, critical improvements in the local development management system linked to (i) the scope of action/generic mandate of local authorities; (ii) planning systems that bridge the local-national divide; (iii) the availability of a diversified set of financing instruments; and (iv) innovative implementation modalities that promote civic engagement and mobilise community and private sector resources. Second, a set of supportive policy and institutional changes at national and subnational levels are required for ensuring sustainability of TALD processes. At national level, these include (i) development-friendly decentralisation reforms that extend the autonomy/accountability of local authorities; (ii) a national urban agenda and (iii) a rural development policy stressing spatial integration of sectors and urban-rural synergies). At subnational level, key ingredients are (i) effective mechanisms for intergovernmental cooperation; (ii) local leaderships and capacities and (iii) active citizenship and public-private partnerships).

The relative importance of these building blocks and their suitability as entry points for systemic reform and external aid are highly context-specific. The adequate approach in a given territory may be revealed only by a careful political economy analysis of the incentives faced by the different stakeholders. In practice, there will also be situations whereby the overall baseline is so weak that the adoption of a TALD policy is unlikely to emerge. 

Joint action as the key to successful TALD processes

In order to operationalise support to TALD – either through thematic or geographic instruments – it is important to agree on the “DNA” of such an approach. Figure 1 visualises these key ingredients of genuine TALD processes, articulated around the principle of joint action between a variety of local public and private actors with a view to formulate and implement a vision on how to develop the territory in a sustainable way. This includes identifying effective ways and means to promote local economic development.

It was also agreed that TALD initiatives are inevitably complex and long-term processes, requiring effective drivers and facilitators. In this context, it is crucial to understand the potential comparative advantages of (elected) local authorities in promoting TALD. Contrary to other actors, they display a number of assets such as: (i) a ‘general mandate’ to take initiatives for and on behalf of their local constituencies; (ii) a political legitimacy to assume responsibility for coordination and integration of the activities of various local actors; (iii) a normative capacity through regulatory measures; (iv) the potential to being responsive and accountable to local demands; and (v) a high degree of stability as a permanent feature of the local institutional environment.

TALD processes with such a ‘DNA’ are seen to have major assets including (i) starting from local potentialities; (ii) building local coalitions to think through a suitable development trajectory for the territory (based on the specific comparative advantages of the place): (iii) mobilising local resources (public and private); (iv) integrating sectors within a spatial approach; (v) working out a balanced set of intergovernmental arrangements and (vi) linking up with domestic/global markets.


Click on the image to enlarge

Changing the EU’s way of thinking and operating

Business as usual approaches will not help when engaging in bottom-up, long term processes of territorial development. Building on good practices that are already visible in EU-supported programmes, the type of ‘software’ needed by the European Commission to promote TALD include:

  • Putting citizens at the centre of TALD processes as democratic actors and drivers of local resource mobilisation/wealth creation;
  • Acknowledging the catalyst role of autonomous and accountable local authorities in TALD processes;
  • Facilitating an effective engagement of local authorities in domestic policy processes that affect them and ensuring their effective participation in EU-supported sector operations (crucial in countries where the EU does not engage directly in decentralisation reforms or local development; in line with the 2013 Communication, there is a need to ensure the smooth integration of local authorities in sector operations to maximise chances of obtaining results and contributing to their empowerment; examples were provided on how to engage local authorities in different sectors such as food security and rural development or natural resources);
  • Accepting that empowerment of local authorities takes time;
  • Accepting the non-linear nature of decentralisation reforms and seizing windows of opportunities;
  • Promoting the use of political economy analysis with a view to understanding the interests, incentives, demand side as well as the progressive scope for reform (a variety of “frames” and analytical tools were presented allowing EUD to decipher decentralisation dynamics in a given country; to explore windows of opportunities and possible triggers to foster territorial development; to ensure a link between decentralisation and the promotion of local democracy; and to identify suitable entry points for EC support; these flexible tools should help to design and implement country-specific and tailored approaches to territorial development instead of applying blueprint models);
  • Making creative use of policy dialogue and the various EU instruments;
  • Acting like an ‘artist’ (process facilitator) by putting less emphasis on the perfect design from the beginning and more on learning from implementation;
  • Managing risks and expectations.

Applying these different ways of thinking and working will not be easy, taking into account the institutional realities currently prevailing in the EU (less human resources, huge administrative demands on staff time, growing risk aversion and pressures for quick results).

ECDPM has been working with the EC in the promotion of development-friendly decentralisation processes, including through territorial approaches.

About the author


Jorge Rodríguez Bilbao is Quality Support Manager of the Civil Society and Local Authorities Unit (DEVCO B2) at the European Commission’s Directorate-General for International Cooperation and Development.

Photo: Fishermen on the beach, Mauritania. Picture taken by ECDPM during Regional Seminar for EU Delegations and local actors on decentralisation and local governance, April 2014.

This article was published in GREAT Insights Volume 4, Issue 4 (June/July 2015).

Economic recovery and transformationDecentralisationTerritorial development

External authors

Jorge Rodríguez