Division 2.4 Meeting the challenges

Rural areas are characterised by a very large diversity of situations, ranging from remote rural areas suffering from depopulation and decline to peri-urban areas under increasing pressure from urban centres.

According to the OECD definition, which is based on population density, rural regions^f1 account for 92 % of EU territory. Furthermore, 19 % of the population live in predominantly rural regions and 37 % in significantly rural regions. These regions generate 45 % of Gross Value Added (GVA) in the EU and provide 53 % of the employment, but tend to lag behind non-rural areas as regards a number of socioeconomic indicators, including structural indicators. In rural areas, per capita income is around a third less^f2, activity rates for women are lower, the service sector is less developed, higher education levels are generally lower, and a smaller percentage of households has access to broadband internet. Remoteness and peripherality are major problems in some rural regions. These disadvantages tend to be even more significant in predominantly rural regions, although the general picture at EU level can vary substantially between Member States. Lack of opportunities, contacts and training infrastructure are a particular problem for women and young people in remote rural areas.

Enlargement has changed the agricultural map. In the old Member States agriculture accounts for 2 % of GDP, in the new Member States for 3 % and in Romania and Bulgaria for more than 10 %. In the new Member States the employment share of agriculture is three times higher (12 %) than in the old Member States (4 %). In Bulgaria and Romania agricultural employment levels are considerably higher.

The combined agricultural and food sector forms an important part of the EU economy, accounting for 15 million jobs (8,3 % of total employment) and 4,4 % of GDP. The EU is the world’s largest producer of food and beverages, with combined production estimated at EUR 675 billion. However, the sector remains highly polarised and fragmented in terms of size, with significant opportunities and threats for firms. Forestry and related industries employ around 3,4 million people with a turnover of EUR 350 billion, but only 60 % of annual forest growth is currently exploited.

Agriculture and forestry represent 77 % of land use in the EU. The environmental performance of agriculture in the preservation and enhancement of natural resources in recent years has been mixed. As regards water quality, total nitrogen surplus has declined slightly since 1990 in most of the old Member States, although some countries and regions still experience significant nutrient leaching pressures. Problems of ammonia emissions, eutrophication, soil degradation and decline in biodiversity persist in many areas. However, an increasing share of agricultural area is devoted to organic production (5,4 million hectares in the EU) and renewable resources (an estimated 1,4 million hectares was used for bioenergy production in 2004, of which 0,3 million hectares under the energy crop premium and 0,6 million hectares on set-aside land). Long-term trends in climate change will increasingly shape farming and forestry patterns. There have been advances in the protection of biodiversity with the implementation of Natura 2000 — around 12-13 % of agricultural and forestry area has been designated. High nature value farming systems play an important role in preserving biodiversity and habitats, as well as in landscape protection and soil quality. In most Member States, these farming systems account for between 10 % and 30 % of the agricultural area. In some areas the abandonment of farming could engender serious environmental risks.

Rural areas therefore face particular challenges as regards growth, jobs and sustainability in the coming years. But they offer real opportunities in terms of their potential for growth in new sectors, the provision of rural amenities and tourism, their attractiveness as a place in which to live and work, and their role as a reservoir of natural resources and highly valued landscapes.

The agricultural and food sectors must seize the opportunities offered by new approaches, technologies and innovation to meet evolving market demand both in Europe and globally. Above all, investment in the key resource of human capital will allow rural areas and the agrifood sector to look to the future with confidence.

On the occasion of the relaunch of the Lisbon strategy, the European Council has reaffirmed that the Lisbon strategy is to be seen in the wider context of sustainable development requirement that present needs must be met without compromising the ability of future generations to meet their own needs^f3. The new programming period provides a unique opportunity to refocus support from the new EAFRD on growth, jobs and sustainability. In this respect, it is fully in line with the Declaration on the Guiding Principles for Sustainable Development^f4 and the renewed Lisbon Action Programme which seeks to target resources at making Europe a more attractive place in which to invest and work, promoting knowledge and innovation for growth and creating more and better jobs.

Rural development policy must help rural areas meet these objectives in the period 2007 to 2013. This requires a more strategic approach to competitiveness, job creation and innovation in rural areas and improved governance in the delivery of programmes. There must be an increased focus on forward-looking investments in people, know-how and capital in the farm and forestry sectors, on new ways of delivering win-win environmental services and on creating more and better jobs through diversification, particularly for women and young people. By helping the EU’s rural areas to fulfil their potential as attractive places in which to invest, work and live, rural development policy can play its part in the sustainable development of Europe’s territory.