The Palestinian Territory has a rich political history. Despite the many challenges and difficult political situation since many years – the lack of a peace agreement and the ongoing occupation of the Palestinian Territory by Israel -, most Municipalities and Village Councils have been able to sustain their service provision as far as possible. They are the most legitimate structures and ancient institutions in the Palestinian Territory. For this particular reason, the local administrations are seen as the backbone of Palestinian public administration.

The LGRDP II program fully recognizes the vital role local governments play and aims therefore to further improve and develop the territory of Palestine. The local governments are seen as the driving force for promoting both state build-ing and local economic development.

Three key approaches of the program can be distinguished:

1. Improving the capacities of the local governments through promoting inter-villages collaborations.
   
   
2. Better integrating all three levels of government through the development of a decentralized framework.
   
   
3. Promoting of local cultural, social and/or economic development.