The Component empowers local communities in their socio-economic development. The component anchors the work of citizens and their organizations in efforts to enhance living standards and provide coherent alternatives for socio-economic development at local and regional levels in Uzbekistan.

- Increase awareness and coordination on the important contributions that civil society organizations (CSOs) can make towards development and enhancement of living standards in Namangan region.
The project strengthens interactive dialogue and networking between and among local communities, CSOs, regional authorities and donors in order to promote trust, sustained communications and partnerships and to expand the pool of stakeholders in the process of enhancing living standards. Such interaction is also essential in the process of developing local and regional strategies (Component I) and makes them more inclusive and realistic. This initiative also includes training of both government and non-government organizations as well as study tours to places where successful experiences of government-civil society interactions have been achieved.

- Support capacity development efforts of CSOs, local communities and their partners-constituents in Namangan region to effectively contribute to enhancement of living standards in the region.
The ability to contribute to the process only comes through increased capacity to internalize priority issues and address them. Support will be provided to the preparation of materials that will contribute to a better understanding of the role of CSOs in socio-economic development and the coordination of their activities.
In addition, target local communities and mahallas, civil society groups and organizations undergo training on strategic planning, budget management, grant preparation, participatory planning and others. Support is also provided for the implementation of CSO volunteer-internship programme with international organizations and/or projects. This activity is an essential entry point for subsequent implementation of micro-credit and social investment schemes. Furthermore, in order to strengthen capacities of CSOs, the Component provides support to the elaboration of a Manual on Working with Communities, which will illustrate basic practices, general recommendations, methodology and approaches to community development experience and practices in regions of Uzbekistan based on the ELS experience.

- Support the economic and social development of vulnerable population and communities in project districts.
The project provides financing for social investment needs of communities. Community infrastructure projects are implemented in 50 communities together with communities and their in kind contributions. Communities contribute labour, equipment and services. Capacity development of women and youth will be a special focus of these interventions.