Community-based economic development is an approach in the field of economic development, where the community acts as the main actor in the economic development cycle in its region. This approach aims to improve community welfare through community empowerment efforts to be more independent and develop capabilities and optimize the potential of local resources. This approach has the following characteristics:

1. Community empowerment, where communities are encouraged to actively participate in planning, implementing, monitoring and evaluating all economic activities in their area. This is intended to increase the capacity and skills of the community in the economic sector.
2. Utilization and use of local resources, such as local culture, skills, local resources to create added value, increase community income and to preserve local potential, such as developing community-based tourism areas, where local communities are involved in managing tourist destinations that utilize the uniqueness of local culture and nature, such as homestays, cultural tours, local cuisine, local knowledge and so on.
3. Aimed at building local economic independence by reducing community dependence on external parties by developing sustainable and independent local economic potential according to their capabilities, such as developing farmer groups and agricultural cooperatives managed by the local community to increase agricultural output and farmer income.
4. Ensuring that the benefits of economic development can reach and be enjoyed by all levels of society regardless of their background. For example, developing creative industries such as handicrafts, arts and other local cultural products.
5. Integrate sustainability principles into every aspect of economic development to ensure a balance between economic, environmental, and social needs.
6. Involve various stakeholders in the form of participation and collaboration, between government, non-governmental organizations, and the private sector, to work together in supporting community economic development, such as Program Badan Usaha Milik Desa (BUMDes) Program in Indonesia which provides direct access to funds to village communities in financing local potential and economic development projects.

In practice and several existing studies, community-based economic development has an impact and benefits in efforts to improve community welfare. By being directly involved, the community can increase their income and quality of life. This activity also encourages social empowerment of the community to be more confident and have greater control and encourage their own future. Indirect economic development will provide benefits to efforts to improve local infrastructure such as road repairs, health facilities and access to education which are certainly useful in supporting community activities. From the three things above, it will contribute to reducing existing poverty, by increasing employment opportunities and income. In its development, community economic development is aimed at developing activities in a sustainable and inclusive manner, so that it prioritizes collaborative and cooperative efforts that pay attention to various social, economic and environmental aspects.

In supporting community-based economic development, efforts are needed to facilitate all interests in accessing the resources needed. This step is important to ensure and guarantee that the community has the ability and means to develop their economic potential. This access includes financial, human, natural, regulatory and technological resources.

In financial resources, microfinance institutions or cooperatives can be developed that are aimed at supporting small and medium-sized community businesses by providing low-interest capital loans, for example. Procurement of subsidy and grant programs carried out by the government or non-governmental institutions to start and develop local businesses. In addition, innovative financing schemes such as crowdfunding or venture capital can be introduced that can provide funds for community-based projects. For example, this is done by Grameen Bank in Bangladesh by providing microloans to the poor without collateral, which has helped millions of people escape poverty.

In terms of human development to support the community's economy, this can be done by providing skills training that is relevant to local market needs and industry trends, such as digital literacy skills, technology utilization, internet access, handicrafts, or agriculture. Community-based education can also be developed, such as making the community a learning center, including providing entrepreneurship education through courses or workshops to encourage people to dare to start and manage their own businesses. It doesn't just stop at this stage, the community's economy also needs to be supported by opening access to markets such as organizing local markets and exhibitions to showcase products and services produced by the community, including increasing access to transportation and a good logistics system to facilitate product distribution to local and global markets.

In an efforts to educate the community can also be developed in the sustainable use of natural resources. Education includes first natural resource management and to ensure that these resources can be used in the long term. Second, encouraging diversification of processed products produced based on local resources to create value-added products, such as processed food, crafts, ecotourism and others, by integrating local wisdom and traditional practices in natural resource management to increase effectiveness and sustainability. For example, in Yogyakarta, there is a Nglanggeran volcano ecotourism area that uses natural and cultural resources to develop community-based tourism that provides direct economic benefits to the local community.

From what has been described above, efforts are needed to support the development of the Community economy, through government policies by providing policies such as tax incentives, ease of licensing, regulations that support inclusivity for all community groups, such as marginal and vulnerable groups, to have equal access to economic resources.

-Diana Anggraeni