Bogotá Local was developed to address some of effects of the economic crisis caused by the pandemic to low-income and vulnerable families in Bogota. This is a reactive response in the short term oriented to recovery and that, in the medium and long run, will consolidate as part of the so-called "people's economy" (economía popular). It is an innovation deployed by the Secretariat of the Government and the Bogota Mayor's office to, principally, serve women, young populations and the elderly.
The main issue to be addressed is the economic affectation of the most vulnerable populations in Bogota as a result of continuous lock downs and the shrinking of the economic environment of the city amid the pandemic. With a particular focus on
- Employment - the underemployment rate doubled to 23.6%.
- Supporting Small and Micro entrepreneurs - 7 out of 10 lost their main source of income self-generation.
- The cultural sector - affected by the abrupt fall in inbound and international tourism with losses of USD >83 million.
In the context of the pandemic, the people's economy was not the main focus for the country. In that sense, the innovation is about making public management more flexible so that local mayors' offices could invest resources in their local economies and thus meet their own needs. Bogotá Local is a comprehensive strategy focused on strengthening the people's economy characterized by human and financial leverage to small producers, family businesses, shopkeepers, micro-entrepreneurs, and people who are responsible for cultural and artistic activities.
Its primary objective is focused on strengthening and consolidating the people's economy, which are all those economic activities that are carried out outside the formal economy. Its specific objectives are oriented to leverage productive niches, to provide payroll incentives to maintain workers and/or hire new people, to generate training processes in business and develop digital skills, to provide specialized institutional support, train people in the artistic, intercultural and/or heritage fields, to support MSMEs and/or cultural and creative enterprises, among others. The direct beneficiaries are those living in the people's economy of each locality. This strategy is innovative because it prioritizes women, mothers and heads of households, young people, the elderly and rural populations.
The course of action is divided into three moments: Reactive, Recovery and Consolidation. In 2020 we began with a reactive strategy, which consisted in reacting quickly to the humanitarian crisis cause by COVID-19. With the easing of the restrictions we began with the recovery phase, which was focused on reaching out to small-size business and micro and informal entrepreneurs. Based on their own needs, we provided employment incentives, payment of rents, supplied with construction materials, among others. Now in 2022 we are in the process of consolidating the people's economy, which is why we focused only and strengthened the small producers and micro-entrepreneurs single business units and its networks.
What Makes Your Project Innovative?
Bogotá Local is novel because of its focus on activating the people's economy, in particular by targeting small producers and family-run businesses. This was a strategic prioritization that foremost gave women and heads of households, young people and seniors preference over other actors.
The initiative is also innovative as it was the first time that the central government and the Mayor's office made direct investments in the concept of "people's economy". This approach required a shift in the way investments are prioritized and conceptualized. In that sense, it is innovative because the focus of the recovery was not on large companies, rather on the population that faced most of the economic burden of the crisis caused by the pandemic.
Collaborations & Partnerships
It was led by the Secretariat of Government with the local mayor's offices (providing technical and budgetary support). Technical support was provided by the Secretariat of Economic Development and the Secretariat of Culture. As operating partner organizations are: the United Nations Development Program (UNDP), the U.S. Agency for International Development (USAID) and private entities that managed the incentive packages, subsidies and promoted social benefits for the population.
Users, Stakeholders & Beneficiaries
The direct beneficiaries of the strategy are those in the people's economy (shopkeepers, micro-entrepreneurs, family productive niches, among others). Specifically, the beneficiaries were: 32,297 people with jobs, 22,734 productive units, 12,656 women, 10,928 men, 8,799 young people, 1,230 rural producers and 949 cultural-related businesses. Among the beneficiary sectors we targeted: commerce, manufacturing, culture, services and agriculture and livestock.
Results, Outcomes & Impacts
Bogotá Local delivered results 2021 to: 32,383 people with jobs, 22,734 productive units or productive family enterprises with incentives. This benefits went directly to: 12,656 women, 10,928 men, 8,799 young people, 1,230 rural producers and 949 cultural incentives. During this period a total investment of $194,134,431,273 was made, corresponding to 51,658,975 USD (TRM June 2020).
In the year 2022, we seek to continue with the consolidation of the people's economy, where we expect to benefit 23,000 micro-businesses with an investment of $8,000,000. Priority will be given to micro enterprises run by mothers who are heads of households, young people, those over 55 years of age, oriented to green reconversion with sustainable practices, people with disabilities, victims of the armed conflict, cultural and creative micro enterprises, and members of ethnic communities.
Challenges and Failures
- The first and main challenge was the change in the existing regulation to allow direct investments and transfers to local beneficiaries, instead of delivering it to third parties. In this case, this uncommon kind of delivery required a policy that guarantees an adequate execution of resources by the beneficiaries.
- There was also a difficulty in relation to the quota limit, since on some occasions the calls for applications had to be closed due to excessive enrollment. Likewise, it was identified that some people lacked technological capabilities for registration and the face-to-face processes were intensified.
Conditions for Success
Bogotá Local requires different conditions to achieve the success:
- It is necessary to have a clear leadership to conduct detailed follow-up, analysis of the perception of beneficiaries, and to drive the political will of the administrations.
- This innovation also required human resources to carry out the technical, legal, administrative and financial analysis required for the implementation of Bogota Local and the delivery of the incentives and benefits granted.
Bogotá Local has an innovative public management model based on a rigorous coordination process to meet the needs of the targeted population. The basics of the project can be taken and upscaled to solve a specific priority of a territory as they are adaptable to the conditions of municipalities, departments and countries.
- Institutional articulation is fundamental for carrying out a timely supply of goods and services to a target population. This public management process made it possible to clarify territorial needs, specify products or goods to be delivered and strengthen the people's economy of each locality.
- It is key to have the participation of the people identified as main beneficiaries. Their specific knowledge and experiences will allow to clearly determine the needs.
- The local mayor's offices, being the closest entities in each locality, must clearly promote and consolidate their productive niches in order to strengthen the economy in each territory.
- Implementation - making the innovation happen
- Evaluation - understanding whether the innovative initiative has delivered what was needed
- Diffusing Lessons - using what was learnt to inform other projects and understanding how the innovation can be applied in other ways
16 November 2022