Phase 1: Economic Baseline Assessment

THE BASELINE ASSESSMENT answers one deceptively simple question:
where is your municipality, right now, economically?

Every credible LED plan and every fundable proposal rests on this foundation.
Donors read the baseline first because it tells them whether you understand the
problem you are asking them to finance. A vague baseline signals a vague project.

WHAT TO COVER

1. ECONOMIC STRUCTURE — Which sectors generate local income and jobs
(agriculture, tourism, trade, services, manufacturing)? Which are growing,
which are declining? Identify the two or three sectors where the municipality
has a genuine competitive position.

2. EMPLOYMENT & LIVELIHOODS — Working-age population, labour force
participation, unemployment (especially youth and women), informality, and
out-migration. Disaggregate by sex and age — funders require it.

3. BUSINESS ENVIRONMENT — Number and size of registered firms, dominant
informal activities, access to finance, permitting and licensing times, and the
main obstacles entrepreneurs report.

4. INFRASTRUCTURE & SERVICES — Roads, electricity reliability, water,
connectivity, markets, and logistics. Note specific bottlenecks that constrain
private activity, not a generic wish list.

5. FISCAL SITUATION — Own-source revenue, transfers, the largest expenditure
lines, and capital-investment capacity. This shows whether you can co-finance.

6. SOCIAL & INCLUSION INDICATORS — Poverty, education, gender gaps, and
vulnerable groups. Inclusion is now a scoring criterion for most donors.

HOW TO DO IT WELL

Triangulate sources: national statistics offices, line-ministry data, your own
revenue records, chamber-of-commerce lists, and structured interviews with
local businesses. Where hard data is missing, a clearly labelled, defensible
ESTIMATE is acceptable — fabricated precision is not. State your assumptions.

Turn every number into a sentence a non-expert can act on: not "unemployment is
24%," but "roughly one in four working-age residents — and nearly half of those
under 25 — have no formal income, which is why job creation is our first
priority." That translation from data to decision is the whole point of Phase 1.