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Better rural policies for better lives

What makes a rural community a good place to live, work, run abusiness, start a family and grow old? It is a whole variety offactors—from the quality and accessibility of services like schoolsand health care to environmental amenities, opportunities to startand grow businesses and even social trust and communityleadership. Recognising this, OECD countries are increasinglyembracing a holistic lens on rural development, focusing on well-being across its many dimensions.

The Principles on Rural Policy crystallise over 20 years of the OECD’swork on rural development. They are based on the premise thatplace-based policies should:

Deliver well-being to all; Be underpinned by sound multi-level governance and community-led

development; Prepare rural areas for technological, demographic and environmental

change; Address the diversity of challenges and opportunities facing rural

areas; and Be informed by sound evidence and data at the right scale.

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Over 20 years of rural development at the OECD

The Principles on Rural Policy have been shaped bythe OECD’s Working Party on Rural Policy and theRegional Development Policy Committee. Since1994, trends and best practices of rural policy arediscussed, analysed and shaped in this uniqueinternational forum. Its work centers around:

National Rural Policy Reviews: Comprehensivereviews of rural policy for individual countries

Thematic Studies: Analysing various aspects ofrural policy, including

• Innovating the rural economy• Service Delivery• Mining and extractive industries• Economic Development of Indigenous communities• The governance of land use• Renewable energy• Urban-rural linkages• Food security and nutrition

Rural Development Policy Conferences:Strengthening existing networks of policy officialsand fostering knowledge-sharing on rural policy

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Developing the Principles on Rural Policy

The Principles on Rural Policy were developedthrough a comprehensive review process with OECDmember countries and key stakeholders. They aretargeted to: i) National ministries dealing with ruralareas in OECD members and partner countries; ii)subnational levels of government and iii) stakeholdersinvolved in or affected by rural policy (e.g. from civilsociety, the private sector, academia or financialinstitutions).

The Principles on Rural Policy address the followingquestions:

What is the right scale for rural policy?

How do we develop a coherent strategy thatcoalesces objectives, funding and incentivesacross different sectors and across levels ofgovernment?

How can we engage all the relevantstakeholders throughout the policy cycle?

How can they be implemented best?

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Engagement and review process

Sept. 2018 Draft Principles sent toWorking Party on RuralPolicy (WPRUR) delegatesfor comment and review

Draft discussed with SteeringGroup in Paris

Draft discussed with WPRURand Regional DevelopmentPolicy Committee (RDPC)delegates

Draft shared in a webinarwith rural policystakeholders from across theOECD

Draft shared with over 2000rural stakeholders fromacross the OECD

Final draft shared withWPRUR delegates

Draft approved by WPRURand RDPC

March 2019: Principles on RuralPolicy launched at the OECDMinisterial meetings onRegional Development inAthens, Greece.

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Maximise the potential of all rural areas

• Leverage the unique assets of each ruralarea to adapt and respond to emergingmega-trends (digitalisation, globalisationand trade, climate change, populationageing, and urbanisation); and

• Adapt policy responses to different typesof rural regions including rural areasinside functional urban areas (cities andtheir commuting zones), rural areas closeto cities and rural remote areas.

30% of the population in OECDcountries live in non-metropolitan regions. That is,regions that have lowerpopulation densities and whereless than 50% of its populationlive in a Functional Urban Area.

Metro Region Non

Metro

30%

70%

Rural is not synonymus with decline. Some of the fastestgrowing OECD regions are rural - others, especiallyperipheral, are lagging further behind. The OECD’s Principleson Rural Policy argue for adjusted and upgraded policy-mixeswith a view to capitalise on the opportunities presented bynew technologies and changing preferences that could andshould make rural areas far more attractive—increasingcompetitiveness and spreading well-being to all. They gobeyond the traditional urban - rural dichotomy and argue foran integrated, functional and systems logic that builds oncoordinated bottom-up actions as well as top-downapproaches.

- Dr. Peter Wostner, Chair of the OECD Working Party onRural Policy

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Organise policies and governance at the relevant geographic scale

• Implement rural policies at different scalesthat match with functional relationships(e.g. local labour markets, food chains,environmental services and amenities)based on current and future needs;Ensuring that there are effectivegovernment mechanisms at the relevantscale to realise rural policy objectives; and

• Encourage the efficient and effectiveprovision of public services andinfrastructure (e.g., shared services,integrated service delivery, e-services) inorder to maintain quality and accessibility,address market failures, and respond toemerging needs, especially in underservedrural communities.

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Different types of rural areas

Rural inside a metropolitan regions

Rural close to metropolitan regions

Rural remote

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Support interdependencies and co-operation between urban and rural areas

• Leverage the spatial continuity andfunctional relationships between ruraland urban areas in order to inform publicinvestment and programme design; and

• Carry out joint strategies and fosteringwin-win rural-urban partnerships, asappropriate, to promote an integrateddevelopment approach.

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Getting the incentives right

Municipalities are often set up tocompete with one another –even the smaller ones. This canlead to uncoordinateddevelopment and expansion thatis difficult to service and provideinfrastructure to.

Governments should promoterural-urban partnerships by:

Aligning fiscal incentives topartnership goals

Ensuring coordinationincentives exist in spatialplanning legislation

Creating legal partnershipforms: e.g., shared serviceagreements

Urban areas Size

Performance Transport infrastructure

Rural areas Size

Performance Environment

Transport

Physical distance

Governance & partnerships

Environmental goods & amenities

Service provision

Investments & economic transactions

Population, human capital, commuting flows

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Set a forward looking vision for rural policies

• Improve well-being for rural dwellers acrosseconomic, social and environmental objectives;

• Ensure that responsibilities and resources acrosslevels of government are clearly defined andeffectively aligned with national targets andstrategies, place-specific needs, and the SustainableDevelopment Goals;

• Ensure that rural policy objectives benefit fromforesight studies, are measureable at differentscales (administrative and functional) and connectto policy levers;

• Provide access to data tools such as geographicinformation databases, smart data and small areadata and strengthening capacity building in order tohelp national and sub national governmentsinvolved in rural policy-making prepare fordemographic change, climate change and thetransition to a low-carbon economy, digitalisationand the next production revolution; and

• Promote integrated spatial planning that considerssuch factors as environmental quality, wastemanagement, natural resources development,community attractiveness, climate changemitigation and adaptation and population ageingand out-migration

the highest elderly dependencyratios – the share of populationaged 65 and over as a percentageof the population aged 20-64 –are present in non-metro regionsclose to metro regions with:

Planning for the future….

33.5%

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Leverage the potential of rural areas to benefit from globalisation, trade and digitalisation

• Create an enabling environment for ruralareas to identify and invest in their areas ofcompetitive advantage such as tradeableactivities and adding value to rural assets;

• Invest in digital connectivity to enable theuse of next generation technologies in ruralareas such as cloud computing, artificialintelligence, the internet of things, andblockchain technologies among others; and

• Facilitate the decentralisation ofproduction (e.g. renewable energy and 3Dmanufacturing) through supportive policiesand regulations.

The rural-urban broadband divideis closing…

• The rural-urban broadband gaphas been closing in almost allOECD countries since 2010.

…But the quality of broadbandremains behind in many ruralareas.

In 2016, just 56% of ruralhouseholds had access to fixedbroadband with a minimumspeed of 30 Mbps, incomparison to over 85% inother areas.

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Support entrepreneurship to foster job creation in rural area

• Enhance technological innovation anddiffusion in order to overcome the barriers ofphysical distance and lower density such ashigher transportation costs and thin labourmarkets present in rural areas;

• Promote innovation and value-addedactivities in established (e.g., agricultural andindustrial production, logistics) and emerging(e.g., bio-economy, renewable energy,biotechnology, tourism) sectors;

• Support the integration of local SMEs intoglobal value chains and the scope fordiversification of rural economies throughinvestments in entrepreneurial skills,infrastructure, and cluster initiatives;

• Support entrepreneurs and SMEs in ruralareas to access capital (e.g., through financesupport schemes, lending tomicrobusinesses); and

• Connect rural people and firms with lifelongeducational training opportunities and skillsupgrading in universities, research centres,manufacturing extension centres, agriculturaladvisory services and vocational institutions.

Understanding Rural Innovation

The United States Department ofAgriculture undertook a broadstudy to better understandinnovation in rural areas.• Metro areas are slightly more

innovative – 20% of rural firmsare substantive innovators,compared to 30% of firms inmetro areas;

• Non-metro areas have a slightly higher rate of substantive innovation for large firms, while urban areas win in their rate of by small and medium-size firms.

• Rural areas tends to innovate in patent-intensive manufacturing in industries, while urban areas have higher rates of innovation in services.

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Align strategies to deliver public services with rural policies

• Assess the impact of key sectoral policies(e.g., transportation, health, education) onrural areas and diagnosing whereadaptations for rural areas are required(e.g., rural proofing);

• Recognise where policies and regulationscreate additional barriers to the provisionof public services in smaller places andresponding with innovative solutions;

• Incentivise innovative practices such asflexible models of service delivery andleveraging advances in digital technologiesto deliver e-services (e.g., e-health andremote education); and

• Develop smart rural villages and towns bypromoting digitalisation complemented bytraining for public sector personnel andresidents to navigate and use e-services.

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The challenge of service provisionin rural areas together withgrowing demand (due topopulation aging) and increasingcosts, has led governments—national, regional and local—tolook for new ways to provideservices beyond traditional models,such as:

Integrating servicing by joiningup benefits

Adopting flexible service modelslike mobile services

Co-locating and co-deliveringservices

Expanding e-services

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Strengthen the social, economic, ecological and cultural resilience of rural communities

• Ensure the sustainable management ofnatural capital, land-use and enabling thecreation of value from ecosystem services(e.g., flood protection services, increasingbiodiversity on agricultural lands);

• Support a comprehensive and justapproach to climate change adaptationand mitigation for rural areas (e.g., foodproduction, soil management, water use),and developing robust systems for disasterresponse and recovery;

• Decarbonise the energy sector by takingadvantage of renewable energyopportunities and supporting the shift to acircular economy (e.g. bio-waste,sustainable mining practices);

• Value, promote, and preserve tradition,heritage and cultural assets; and

• Ensure that rural areas have institutionalcapacity, good governance and funding tofulfil their roles and deliver high quality oflife for residents, from youth to seniors.

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Decarbonising the energy sector

• The share of renewabletechnologies meeting globalenergy demand is expected toincrease by a fifth, reaching12.4% in 2023.

IPCC (2019). Climate Change and Land.https://www.ipcc.ch/site/assets/uploads/2019/08/4.-SPM_Approved_Microsite_FINAL.pdf

Towards more sustainable landuse

• Land present in rural areas isfundamental to absorbingcarbon from the atmosphere.Forest and wetlands function asnatural carbon sinks absorbingroughly one third of globalemissions.

IEA (2018), Renewables 2018: Analysis and Forecasts to 2023, IEA, Paris, https://doi.org/10.1787/re_mar-2018-en.

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Implement a whole-of-government approach to policies for rural areas

• Engaging with all sectors and levels ofgovernment to integrate national policiesthat improve the wellbeing of rural areas;

• Identifying and addressing the barriers topolicy coherence across ministries, publicagencies and levels of government; and

• Setting incentives, regulations andcoordination mechanisms to mitigateconflicts and manage trade-offs (e.g., landuse, mining, agriculture, energy andwater); and

• Maximise policy complementaritiesacross sectoral strategies throughintegrated and coordinated rural policies(e.g., coordinating transportationinvestments with health and educationservices).

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Lead ministries for rural development across the OECD

59% Agriculture ministries

15% Economy and development ministries

12% Central government agencies

9% Infrastructure ministries

5% Other Agencies / Ministries

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Promote inclusive engagement in the design and implementation of rural policy

• Engage a diversity of stakeholder voices,including those that are underrepresentedand/or marginalised, in the policy processand empowering local and regionalstakeholders to be partners in policyelaboration;

• Engage with the private and not-for-profitsectors and leveraging their expertise andresources to deliver better outcomes forrural areas; and

• Harness innovative mechanisms and digitaltechnologies to develop new ways ofdisseminating public information,generating and using data, and consultingand engaging citizens in decision-making(e.g., participating budgeting, ruralobservatories).

VALUES

How a community could be

Connecting vision to strategy

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Foster monitoring, independent evaluation and accountability of policy outcomes in rural areas

• Evaluate rural policy initiatives andoutcomes and communicating progress inmeeting them in an ongoing manner inorder to improve policy design andimplementation;

• Develop outcomes indicators in order toassess and benchmark rural well-beingthrough economic, social, environmentaland other performance indicators;

• Provide accessible data that is easy-to usein order to help rural communities andstakeholders identify priorities andmonitor progress;

• Explore innovative methods of data-collection that address the challenges ofconfidentiality that are inevitably part ofsmall-area analysis; and

• Assess the process and outcomes ofdifferent steps of public engagement inorder to learn, adjust and improveaccordingly.

How do we know if rural policiesare having their intended effect?

Good data, monitoring andevaluating outcomes has helped usunderstand what works and whatdoesn't, where to focus our effortsand where to change direction. Weprovide in depth assessments ofrural areas, their assets andconditions and how they arechanging over time.

- Dr. Monika Stanny, Director of theInstitute of Rural and AgriculturalDevelopment of the Polish Academy ofSciences

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