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The conventional system of socio-economic development planning in Vietnam is generally characterized by a top-down approach; i.e. annual and longer term targets for planned development achievements are formulated at the central level and trickle down to the decentralized levels of provinces, districts and communes. The system implies a lack of participation from the population at grass roots level and thus a lack of inclusion of their perceived needs. Planning authorities on all levels are increasingly aware of the issue and have introduced reform measures.

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The SMNR-CV project has contributed to these reforms by the introduction of participatory approaches to socio-economic development planning.

The conventional planning system at decentralized levels has also been characterized by its lack of in-depth analysis of local development potentials, comparative advantages, longer term visions, strategic orientation and clear operational priorities. These concerns have been addressed by the SMNR-CV project with the introduction of an innovative planning tool, termed “Strategic Planning for Local Economic Development”. LED is a participatory process where local people from all sectors work together to stimulate local commercial activity, resulting in a resilient and sustainable economy. It is a tool to help create decent jobs and improve the quality of life for everyone, including the poor and marginalized. SMNR-CV has chosen an approach which differs from the method of "Participatory Appraisal of Competitive Advantage" (PACA), as applied in small and medium enterprise development in Vietnam. The advantage lies in a more general strategy development combined with less resources needed for the planning process, which makes it easier to apply and to be integrated into conventional planning.

Before entering the planning cycle of strategic LED, the SMNR-CV prepared a number of short studies on local development potentials, notably resource endowments, main sectors and sub-sectors, to establish a sound basis for the participatory situation assessment.

In the year 2005, a number of workshops on strategic LED were organized on provincial and district levels. The purpose of these workshops was twofold: On the provincial level, SMNR-CV presented LED as an innovative approach to strategic planning and thus contributed to the overall provincial economic development. On the district level, the outputs of the workshops (priority sub-sectors and action plans) were to be used by the SMNR-CV to identify value chains and clusters which could be directly promoted by the project.

Strategic Planning on Provincial Level

A strategic LED planning workshop was organized in March 2005. With the participation of more than 40 stakeholders, representing the political and economic key players of Quang Binh province. The workshop succeeded to introduce the new method and to prepare a wide range of 7 projects aiming at accelerated economic growth. Participants appreciated the new approach as a valuable complement to the conventional planning processes. Action plans were formulated for the following priority areas:

* Human Resource Development
* Tourism Development
* Investment Attraction
* Construction Materials
* Rural Development and Fishery

Following the workshop, the SMNR-CV has assisted the planning authorities to integrate these identified priorities into the ongoing five-years-planning of the Provincial Government. With the approval of respective budgets, the implementation of the action plans and concrete projects has become the responsibility of different government organizations.

Strategic Planning on District Level

Following the provincial workshop, strategic planning for LED was introduced on the district level with the participation of key local authorities, representatives of local enterprises, associations, producer groups, households, mass organizations and donor-supported projects.

As an output of the LED workshop in Tuyen Hoa district, a number of priority areas were identified and action plans formulated for community forestry and a number of sub-sectors (silk, honey, food and wood processing) which were integrated into the district development plans. A larger part of the related supporting activites were integrated into the Operational Plans of the SMNR-CV and carried out in the following years.