Rural development according to FAO: Food security, hunger and sustainability have a complex two-way relationship with the agricultural sector, influencing its performance while it in turn affects rural livelihoods. A clear example is the well-documented vicious-circle relationship between hunger and food security, whereby hunger prevents people from working effectively and producing enough food, while low food production simultaneously exacerbates hunger and poverty. For these reasons, rural development is most successful when growth in agriculture and growth in the rural non-farm economy mutually reinforce one another.
Rural regions in OECD countries are important economically and demographically. They account for 75% of the land and 25% of the population in OECD countries. Increasing globalisation, improved communications and reduced transportation costs are also drivers of economic change in rural areas. Although the contribution of agriculture to rural incomes and employment is low in most regions and declining, it continues to have a key role in the management of natural resources, particularly land and water.
The role of farm households in the rural economy of OECD countries is complex and multi-faceted. While on average the share of agriculture in rural employment and GDP is low and decreasing, agriculture is a large land user and plays an important role in many of the environmental and other land use issues that arise in rural areas.
Farm households provide agricultural and related products and services, participate in local labour markets, use local services and purchase and consume local products. A significant share of the income of farm households comes from non-agricultural sources which means that for many farm households a vibrant, diversified rural economy is crucial to survival on the farm. Rural and farm policy, to be effective, has to reflect these realities.
Currently, OECD mainly focuses on food security, rural innovation and service delivery.
The European Commission guides European agriculture and rural development through it's variety of programs, mainly the Common Agricultural Policy and the Rural Development Policy.
The EU’s rural development policy helps the rural areas of the EU to meet the wide range of economic, environmental and social challenges of the 21st century. Frequently called "the second pillar” of the Common Agricultural Policy (CAP), it complements the system of direct payments to farmers and measures to manage agricultural markets (the so-called "first pillar"). Rural Development policy shares a number of objectives with other European Structural and Investment Funds (ESIF).
Member States and regions draw up their rural development programmes based on the needs of their territories and addressing at least four of the following six common EU priorities:
- fostering knowledge transfer and innovation in agriculture, forestry and rural areas;
- enhancing the viability and competitiveness of all types of agriculture, and promoting innovative farm technologies and sustainable forest management;
- promoting food chain organisation, animal welfare and risk management in agriculture;
- restoring, preserving and enhancing ecosystems related to agriculture and forestry;
- promoting resource efficiency and supporting the shift toward a low-carbon and climate-resilient economy in the agriculture, food and forestry sectors;
- promoting social inclusion, poverty reduction and economic development in rural areas.
European Network for Rural Development published the CORK 2.0 DECLARATION “A Better Life in Rural Areas” in 2016, which concludes that an innovative, integrated and inclusive rural and agricultural policy in the European Union should be guided by the following ten policy orientations:
- Point 1: Promoting Rural Prosperity
- Point 2: Strengthening Rural Value Chains
- Point 3: Investing in Rural Viability and Vitality
- Point 4: Preserving the Rural Environment
- Point 5: Managing Natural Resources
- Point 6: Encouraging Climate Action
- Point 7: Boosting Knowledge and Innovation
- Point 8: Enhancing Rural Governance
- Point 9: Advancing Policy Delivery and Simplification
- Point 10: Improving Performance and Accountability
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