Policy implications of coronavirus crisis for rural development | Interesting results presented in the latest OECD policy note

Source: OECD

This note focuses on the implications of COVID-19 on rural development and the policy responses that OECD member countries are adopting. It first discusses the economic effects on rural regions followed by an identification of opportunities and associated challenges. The note then summarises how governments are responding to the crisis and identifies how governments can prepare to leverage opportunities. Delegates of the Working Party on Rural Policy discussed and shared their input to a first draft of this note at the 23rd meeting on 20 April, 2020and provided some examples that have been incorporated. The note will be subsequently revised with further inputs provided by countries.

Every major crisis, such as the Coronavirus (COVID-19) pandemic, brings opportunities to rethink our systems and make them more resilient to future shocks.

This is also true for rural regions. Rural economies have provided essential goods and services -including food and energy-to households, hospitals and health centres during confinement periods. In some countries, rural areas have also served as a temporary, but safer, location for urban dwellers. Taking a longer perspective, the pandemic can change consumption and production patterns, remote working habits and forms of mobility, which may open new opportunities for sustainable growth in rural regions.

Revisiting globalisation of production chains could also open new opportunities in some rural areas. However, rural businesses and dwellers have been also confronted with several pressures, including those emerging from the pandemic and associated containment measures. Demographic characteristics (a higher share of elderly population) and geographic features (larger distances to access health care centres), coupled with reduced health care staff and facilities,definitely hamper the ability of rural regions to respond to the pandemic. Moreover, the overall slowdown in aggregate demand has affected some primary sectors, and the expected further slow-down in trade and global demand will hit rural economies severely given their higher reliance on tradable activities, such as mining and tourism.

In this context, this note assesses the potential effects and challenges of the pandemic on the economy and well-being of rural regions over the short-term and medium/long term, but also identifies a number of possible opportunities. Finally, it outlines a number of policy responses relevant for rural areas.

How can governments prepare to leverage opportunities

Short-term responses during the COVID-19 crisis have focused on emergency measures to improve health and access to medical services and to maintain basic services in rural areas. These have shed light of the high vulnerability some rural communities face. The stark inequality within countries call for measure that can improve the resilience of vulnerable rural communities to current and future shocks. Measures that can accelerate digitalisation and provide essential services in innovative ways should be at the forefront of policy priorities. In addition to these, other relevant measures to leverage some of the opportunities include:

  • Speed up investments in digital infrastructure and supporting eco-system to increase the uptake of digital tools in rural areas.
  • Encourage the uptake of remote services by better adapting national rules to the specificities of rural communities, training of teachers and health care professionals to adopt remote forms of service delivery.
  • Provide financial and technical assistance to support community-based and social innovation projects that aim at protecting the most vulnerable citizens in rural areas, including the elderly and migrants.
  • Include sustainability criteria in COVID-19 recovery actions so that they also contribute to long-term resilience by addressing climate change and ecological transition
  • Support the resilience of rural communities by enhancing social solidarity networks that meet the basic living standards of the vulnerable citizens in the rural areas.

How are OECD countries responding

Confinement and ongoing de-confinement measures have brought new challenges to citizens and firms across the OECD. Beyond economy-wide measures, national, regional and local governments are also rolling out a number of measures targeting people, firms and communities in rural areas. In parallel, bottom-up initiatives involving civil society and voluntary support groups have emerged to support rural communities coping with the new challenge brought by the COVID-19 pandemic. Actions and initiatives can be summirised in four broad areas:

  • Health responses and improving access to the medical services,
  • Maintaining basic services in rural areas,
  • Supporting rural business and workers,and
  • Improving digital infrastructures and digital accessibility in rural areas.