Reinforcing Rural Resilience

3. Policy solutions for rural regions

Abstract

This chapter covers policy actions to capitalise on opportunities and address challenges across different types of rural regions, those near Functional Urban Areas (FUAs) and those that are remote. It first examines strategic policy approaches to renewed rural competitiveness. This requires place-specific smart specialisation with proactive steering of investment into sectors that leverage their resources like advanced manufacturing, renewables, and the bioeconomy. Targeted rural strategies also seek to align their diverse strengths with national growth sectors and with global trade patterns. Multilevel governance can empower local actors to identify priorities while being backed by national frameworks to strengthen rural-urban linkages, scale innovation, and integrate rural regions into global value chains. The chapter then identifies policy solutions for the environment and adaptive service delivery across types of rural regions. Rural competitiveness also depends on equitable access to healthcare, education, and digital infrastructure – essential not only for well-being but for place attractiveness and trust in public institutions. Only by aligning strategy, communication, and accountability can governments unlock rural potential while maintaining social cohesion.

3.1. Introduction

Rural regions are vital drivers of opportunity, uniquely positioned to contribute to national prosperity, environmental sustainability, and societal well-being. Rural economies are no longer defined solely by agriculture or extractive industries; they often also host half of manufacturing and are increasingly diverse, with growing roles in digital services and the green economy. They possess distinctive assets such as land, biodiversity, natural resources, and cultural heritage that offer immense potential in emerging sectors, including renewable energy, advanced manufacturing and high-value tourism.

At the same time, rural regions face persistent and emerging challenges that need tailored action. Chapter 2 identified genuine opportunities for rural regions, but also acknowledged their accentuated challenges, including population decline and ageing, labour shortages, and heightened exposure to climate risks. Realising rural potential while mitigating these challenges calls for proactive and forward-looking policy action. In an era marked by global megatrends such as climate change, digital transformation, and demographic shifts, rural places can position themselves at the forefront of innovation and resilience. Technologies such as automation and digital connectivity offer opportunities to overcome barriers associated with distance and workforce scarcity, enabling rural businesses to compete globally. Designing effective policy across selected areas (competitiveness, service delivery, and climate) requires tailored action to the different types of rural places (close to FUA and rural remote).

This chapter covers policy solutions to enhance competitiveness and promote inclusive growth across all rural areas, unlocking local potential while ensuring long-term sustainability. Section 3.2 puts forward a strategic policy approach for renewed rural competitiveness. The approach builds on the OECD’s longstanding work on rural development and place-based policies to provide policy makers with strategies that support rural transformation. The emphasis is on smart specialisation, innovation, and more adaptive governance. Based on this approach, Section 3.3 focuses on policies for economic competitiveness in rural near FUAs, with emphasis on manufacturing and rural-urban linkages, while Section 3.4 focuses on rural remote for capitalising on natural resources and reducing distance to markets. Sections 3.5 to 3.7 address service delivery – including education, healthcare, housing – as foundations of rural vitality and well-being. Sections 3.8 to 3.10 cover environmental strategies to embed rural areas in the green transition through the circular economy, bioeconomy, and renewable energy. Throughout, policy responses are tailored to the distinct opportunities and challenges faced by different types of rural region.

The policy approaches are relevant for both local (rural) and national policy makers. Designing and delivering these strategies requires strong co‑ordination between national and local actors. Local initiatives are often best placed to identify viable specialisations, while national governments play a critical enabling role – providing financial support, strategic direction, and cross-sectoral co‑ordination.

3.2. Strategic policy approach for renewed rural competitiveness

Renewing rural competitiveness demands a shift in how rural economies are understood and supported. Today’s rural regions are increasingly diverse. While traditional sectors like agriculture, mining and manufacturing (a large rural employer) remain important, emerging sectors like digital services, and high-value tourism are gaining ground. As discussed in Chapter 2, megatrends – including technology and climate change – are further redefining rural opportunities. The OECD Rural 3.0 (2018) emphasised the need to integrate rural economies into global value chains and leverage digital tools to reduce the constraints of distance and open new global market opportunities for remote businesses (OECD, 2018[1]).

Improving core enablers like skills and infrastructure remains necessary but not enough – strategic direction is also essential. While policies must address enduring challenges such as demographic decline, labour shortages, limited entrepreneurship, and high transport costs, they also need to move beyond ”‘reparative” measures to proactively steer a long-term rural transformation: selecting sectors to prioritise with clear missions (Mazzucato, Doyle and Von Burgsdorff, 2024[2]), aligning other policies (e.g. skills, infrastructure) to those chosen missions, and reshaping economic, institutional, and social structures accordingly. It also means aligning rural competitiveness strategies with global megatrends such as climate change, digitalisation, and evolving trade networks. Rural regions possess diverse and valuable assets that, when supported by the right conditions, can become powerful drivers of competitiveness. Structural policies aim to redefine the development paths of diverse rural regions by leveraging rural-urban linkages, strengthening tradable sectors and manufacturing, and activating natural resource potential.

The policy responses outlined in this chapter build upon established place-based approaches by advocating for forward-looking rural policies that actively steer rural specialisation. The concept of smart specialisation (originated in the EU, but of global relevance) serves to frame policy responses for the strategic identification and promotion of key economic activities compatible with local strengths and aligning policies for those ends. It encapsulates the use of place-based industrial and innovation strategies that aim to harness untapped potential rooted in history, geography, and the distinct economic fabric of each rural region – while aligned to national goals. Place-based policies acknowledge the varying needs and capabilities of rural regions near metropolitan areas compared to those in more remote locations.

Place-based policies anchored in local assets and led by proactive local efforts are essential for resilience and transformation. Rural economic strategies and the proactive entrepreneurial pursuit of new economic opportunities normally needs to be driven by residents and local entrepreneurs and institutions. Still, regional and national support to pursue and scale new economic activities is also needed since many rural regions are not yet equipped for industrial transformation. Labour shortages persist, younger populations are still drawn to cities, and many local actors lack the capacity or tools to drive innovation. Regions that have succeeded often had pre-existing industrial assets and networks that helped them transition into new, specialised markets ( (Duranton and Venables, 2018[3]).

To unlock their potential, rural communities must convert local assets – skills, infrastructure, and resources – into innovation that creates new value. Specialisation and diversification require strengthening rural integration into global value chains and enhancing local innovation capacities. Innovation in rural regions involves more than new products; it includes adapting institutional practices and business models to changing conditions, such as through digitalisation or more flexible service delivery. The place-based process of “local entrepreneurial discovery” required by proactive efforts to find new economic specialisations requires the joint mobilisation capacity by private and public actors. Entrepreneurial capacity must be nurtured, especially as economic and technological conditions are in constant flux. For rural firms, success often depends on quality, branding, and niche markets rather than competing on cost. Supporting rural innovation requires tailored approaches that account for demographic realities and structural challenges distinct from urban environments.

In summary, at the heart of this policy approach are three strategic pillars:

1. Economic specialisation strategies and industrial policy

2. Rural innovation policy

3. Policies to harness technology and digitalisation

Below outlines high-level policy approaches to help rural regions apply these three pillars. Further sections will then delve further into how to tailor policies to capitalise on the unique opportunities of both rural regions near FUAs and rural remote regions.

3.2.1. Economic specialisation strategies and rural industrial policy

Rural regions often need to reinvent themselves to regain their competitiveness in a fast-changing economy, and industrial strategies and policies can be effective tools. Many places have struggled to adapt to global megatrends in technology, sustainability and trade, in part because regional policies have largely failed to restructure regional economies, thus making isolated attempts to attract investment or create local productivity gains futile (OECD, 2009[4]) (OECD, 2019[5]) (OECD, forthcoming[6]). Rural renewal requires long-term economic goals and strategies, with policies that redirect their economic activities towards competitive sectors (Felipe, 2021[7]). Industrial policies, consisting of strategic guidance and diverse government assistance to promote specific industries, can operate place-based to steer business development in sectors that capitalise on the specific strengths of diverse places. Manufacturing is a key target of industrial policy, particularly given the important role of rural in this sector (as analysed in Chapter 2), but it can target any sector deemed strategic for local development.

Industrial policy can support rural transformation either by integrating rural goals to national programmes or by empowering local communities to run their own place-based interventions. Though industrial policy largely continues to be a top-down policy for supporting national strategic sectors, the contemporary conception and practice of place-based industrial policy is moving in the direction of locally-driven collaborations between the public and private sectors to pursue key sectors, often with bottom-up initiatives grounded in specific places and communities. This increasingly involves local or regional authorities, and relevant stakeholders, in driving the strategy, industry selection, and implementation of business assistance, incentives and investments from the bottom up, even if the funding comes from central sources. Place-based policies have been gaining ground to enhance economic performance and reduce social exclusion in specific places, using targeted interventions to address their unique challenges and opportunities (OECD, 2025[8]). The focus is increasingly on competitiveness and the support of businesses in selected sectors (Box 3.1).

Box 3.1. Place Based Industrial Policy as a process of joint public-private pursuit of new economic opportunities

Industrial policy refers to government assistance, usually to businesses, to boost or reshape specific economic activities. Its use is driven by two premises: i) production in some industries is more desirable than in others, typically in pursuit of productivity and growth; ii) governments should make an active effort to nudge the production structure in that direction if markets alone do not.

Place-Based Industrial Policies (PBIP) leverage a place’s distinct assets to capitalise on untapped opportunities, rooted in its history and geography. The premise is that sectors that grow upon local strengths are more desirable—since more likely to succeed—whereas they have not reached their full potential due to market failures or insufficient local capacity to mobilise resources. PBIPs normally involve local or regional stakeholders in driving the local sectoral strategy and implementation of relevant policy interventions:

• Financial and incentive-based tools like grants and tax incentives for business development and attraction

• Public investment in infrastructure, technology and R&D for strategic industries,

• Public procurement to stimulate demand in specific sectors

• Beyond public expenditure, the spectrum covers several types of assistance: training, capacity building of local businesses and entrepreneurs and more

With PBIP, these interventions align with the needs and characteristics of the places, building new economic activities bottom up. The EU’s smart specialisation strategy reflects modern industrial policy: an overarching framework promoting collaborations between businesses and authorities to organically uncover opportunities and co‑ordinate strategies to support local industries (Rodrik, 2004[9]) (Rodrik, 2008[10]) (Hausmann and Rodrik, 2002[11]). The domains for future specialisation are based on a dialogue with regional governments.

To effectively transform rural places and adapt to megatrends, strategies and programmes need to be guided by place-specific strategic goals for economic specialisation. Regional and local strategies, including rural, are often underpinned by a central or national framework to align local strengths to wider (national and regional) goals. The concept of ‘smart specialisation’ is one of the most recent manifestations of place-based industrial policy, aiming at identifying opportunities based on the competencies of regions to build competitive advantage (Foray, David and Hall, 2009[12]). While the concept originated from the EU Smart Specialisation Strategy (S3, which is driving its regional innovation efforts in the last decade), it is relevant as a guiding framework for other OECD countries. This concept is a framework for regional economies that can support industrial and innovation policies, combining public policies, framework conditions, and especially R&D and innovation investment policies to influence the industrial specialisations of a region and consequently its productivity, competitiveness and economic growth path (Foray, Eichler and Keller, 2021[13]). A locally driven process of self-discovery for new economic opportunities, where industrial and other policies are embedded in the contexts of places,1 helps becoming more reactive to megatrends. This is supported by strategic collaboration between the private and public local stakeholders to identify opportunities and bottlenecks, and periodic evaluation of policy outcomes and mistakes2. Many regions have upgraded their role in global value chains, or identify niche, high-value segments, by moving to higher value-added production. For example, Arezzo in Italy has modernised its traditional textile industry with computer-aided design to reach wider markets, supported by its proximity to Milan3.

A strategy that jointly pursues specialisaion and diversification can strengthen competitiveness and resilience in rural economies by being both focused and adaptable. Specialisation and diversification are not opposing strategies but can mutually reinforce each other. While specialisation allows rural regions to build comparative advantages in high-value niche markets—such as wine in New Zealand—it often serves as a catalyst for broader economic diversification. Specialised sectors generate demand for a range of related services—logistics, marketing, certification—that stimulate horizontal linkages and expand the local economic base (Becattini, Bellandi and De Propris, 2009[14]). The Emilia-Romagna region exemplifies this dynamic, where tightly knit production clusters are embedded within diversified ecosystems of SMEs. At the same time, diversification enhances specialisation by increasing resilience to shocks—whether from climate events or global market volatility—and providing a platform for branching into related activities, such as how Marlborough’s wine industry in New Zealand has fostered complementary growth in tourism, gourmet food, and education. This aligns with theories of evolutionary economic geography, which suggest that regions evolve through related diversification, leveraging existing capabilities into adjacent sectors (Boschma and Frenken, 2011[15]). In this sense, diversification sustains specialisation over time, while specialisation creates the foundation for productive diversification.  

Aligning rural strategies with national economic priorities amplifies their impact. Whether industrial strategies are developed locally or as part of broader industrial programmes, they are most effective when integrated into national economic planning. While national industrial policies often focus on urban clusters, it is essential to include rural areas—particularly those near cities—in strategic frameworks. These regions can evolve into innovation-linked clusters, attract foreign direct investment spillovers, and serve as testing grounds for green and high-tech manufacturing. For instance, Oregon’s decision to expand urban growth boundaries to incorporate rural land for semiconductor production demonstrates how spatial planning can support rural–urban industrial integration. France’s Territoires d’Industrie programme fosters rural industrial development through co‑ordinated national–local action, aligning rural manufacturing capacity with national goals and urban demand. Strategic alignment is not limited to manufacturing: in Denmark, sustainable timber and bio-based plastic initiatives link rural production to urban green markets, reinforcing the potential of rural areas in national green transitions.  

In general, industrial policy can direct support to sectors like renewable energy, advanced manufacturing, and climate technologies that align national goals with rural strengths. Germany’s Energiewende (energy transition) demonstrates a place-based industrial policy balancing national goals (climate and competitiveness) and regional development, particularly benefitting rural regions. This includes regions like North Rhine-Westphalia (a former coal and steel hub, in transitioning to green industries), and local rural communities are at the forefront of the clean energy transition.4 Policy levers include public R&D investment, subsidies, and tax incentives in renewable sectors like solar and wind. Its effectiveness lies in aligning sectoral innovation support with regional restructuring, with industrial restructuring funds and retraining programmes preparing places to host the new investments.

Designing and delivering these strategies requires strong co‑ordination between national and local actors. Multilevel governance is increasingly prevalent in place-based industrial policies and smart specialisation strategies (Wibisono, 2022[16]). Local initiatives are often best placed to identify viable specialisations, while national governments play a critical enabling role—providing financial support, strategic direction, and cross-sectoral co‑ordination. A hybrid governance approach is needed: national governments must steer priority sectors and funding, while local actors shape implementation through land use planning, community engagement, and partnerships with industry. Ultimately, better integrating rural regions into national production systems is not only about balanced development—it is a smart economic strategy that enhances resilience, productivity, and competitiveness.

Policy experimentation can help policy makers test innovative approaches to the industrial transition and learn from and build on successes and failures.5 For example, in France’s Grand Est, the lessons from the Industrial Parks of the Future project not only fed and improved the region’s smart specialisation strategy but also strengthened the systems for the sustainable management of natural resources and energy systems. Experimentation also helps build local institutional capacities when more decision-making power is transferred to regions. Rural places need economic and institutional ‘dynamic capabilities’ to adapt along preferred development paths, with the capacity to continuously innovate.6

Box 3.2. Policy Action for rural economic strategies and industrial specialisation

Rural transformation requires aligning policies with comparative advantage, with attention to the endowments, constraints, and opportunities unique to rural areas. Relevant policy actions for developing local specialisation and industrial strategies:

• Identify industries where rural areas possess a latent or emerging comparative advantage. Drawing on both data analysis and local knowledge, policy makers should assess which sectors show potential for growth, employment generation, and competitiveness at regional or international levels.

• Benchmark against other successful rural regions. Identify countries with similar factor endowments but higher levels of income or industrial development. This can help identify industries that are mature or beginning to relocate, offering space for rural economies to enter and compete effectively.

• Supporting existing rural entrepreneurs and “first movers”. These pioneers often face specific barriers—ranging from infrastructure deficits and limited access to finance, to regulatory burdens and skills shortages. Governments should aim to remove these constraints through targeted, sector-specific interventions that are informed by local diagnostics and value chain analysis.

• Focus scarce public resources on the development of rural industrial clusters or zones tailored to the needs of targeted industries. Infrastructure investment plays a critical enabling role. These zones can include agro-industrial parks or artisan hubs, which can foster economies of scale, improve co‑ordination across actors, and lower transaction costs.

• Provide smart, time-bound incentives to pioneering firms operating in line with the area’s comparative advantage. These may include tax relief, access to subsidised credit, or support for training and certification. Crucially, such incentives should avoid distorting markets or creating long-term dependencies; rather, they should support the diffusion of innovation.

National agencies can support the above efforts with widespread growth diagnostics and piloting:

• Pilot industrialisation initiatives in select rural areas: To select appropriate pilot locations, choose regions with a significant, modernising agricultural base, competent local governance with effective implementation capabilities, a labour force possessing foundational education and technical skills, adequate infrastructure to support industrial activities. Upon success, scale up operations.

• Co‑ordinate with existing programmes and stakeholders: align new industrial policies with current initiatives, learning from past successes and failures. Engage key stakeholders, including foreign companies, NGOs, educational institutions, to ensure comprehensive support and resource sharing.

3.2.2. Rural innovation policy as engine of rural prosperity

Rural innovation is a cornerstone of rural transformation, enabling regions to identify and develop their unique competitive advantages. The smart specialisation approach is an example that relies on a process of ‘entrepreneurial discovery’, where public and private stakeholders collaboratively identify priority sectors based on local strengths and innovation potential (Foray, David and Hall, 2009[12]). In rural areas, this process depends on harnessing locally embedded knowledge, encouraging experimentation, and supporting the scaling of grassroots initiatives. Innovation provides the mechanism through which rural communities can transform existing capabilities—such as agricultural expertise, natural resource management, or cultural assets—into high-value economic activities. This requires strong local institutions, investment in human capital, and access to knowledge networks that connect rural actors to research institutions and urban markets. Evidence from EU smart specialisation strategies shows that innovation ecosystems—comprising SMEs, public agencies, universities, and civil society—are essential to support this transition, even in low-density regions (McCann and Ortega-Argilés, 2016[17]). Therefore, fostering innovation is not only a developmental goal in itself but a necessary condition for rural regions to chart their own transformation paths through smart specialisation.

A narrow focus on high-tech innovation can overlook the forms of innovation that matter for rural regions, the ones that address their unique challenges and improve well-being. Innovation is often measured through indicators such as patents or R&D intensity, which tend to concentrate in urban, high-tech clusters. For instance, between 2016 and 2020, remote regions in OECD countries registered an average of 24 patents per million people, compared to 153 in metropolitan regions (OECD, 2024[18]). These figures reinforce the perception that rural areas are less innovative. However, this view is shaped by a limited understanding of what constitutes innovation. Traditional metrics often fail to capture how rural regions adopt, adapt, and apply innovations—especially those not originated locally. These bias risks overlooking the diverse and practical forms of innovation in rural places, such as improvements in processes, service delivery, and community-based solutions that respond directly to rural challenges. 

A rural lens to innovation helps capitalise on opportunities and address the unique challenges. Social, managerial, product and operational innovation can be particularly helpful for micro- and small firms. Innovation in the public sector is another form, which could create greater inclusiveness; support larger societal goals (e.g. addressing climate change); and generate greater citizen satisfaction with public and administrative services.7This lens also addresses the unique barriers of rural businesses, such as limited access to skilled labour, finance, public services, and entrepreneurial support.

A rural-specific approach to innovation policy is needed to unlock the full potential of rural entrepreneurs and communities. The OECD’s project on Enhancing Rural Innovation, drawing on case studies from Switzerland, Scotland (UK), the United States, Canada, and Japan, identifies four strategic policy areas to support innovation in rural contexts. These include: i) broadening the definition of innovation beyond science and technology; ii) tailoring programmes to the unique demographics, firm profiles, and community assets in rural areas; iii) improving co‑ordination and simplification of existing public services; and iv) fostering networks and linkages to strengthen rural innovation ecosystems. These areas are not one-size-fits-all—Table 3.1 provides examples on the four policy areas and shows how these four policy areas are differentiated amongst rural regions close the cities and remote ones.

Table 3.1. Four types of policy areas to support rural innovation

Policy action	Examples	Accessible versus Remote
i. Going Beyond Science and Technology
Supporting Social Innovation	Highlands and Islands Enterprise Agency, Scotland, UK	Services and support vary by degree of remoteness
Creating opportunities through public-private partnerships for innovation and public service delivery	Community-based access to digital infrastructure, Scotland, UK International Institute for Sustainable Development Experimental Lakes Area (IISD-ELA), Ontario, Canada Kamo Aquarium, Yamagata, Japan	Joint development for rural remote, but can be more viable in accessible rural
Building a culture for experimentation	Innovation Boosters, Innosuisse, Switzerland; Regulatory Sandboxes: Fintech in Australia; Digital in UK	Different rural remote and accessible opportunities for experimentation.
ii. Policies Fit for Rural Demographics and Firms
Improving access to information in Rural Areas	National Statistical Services, Scotland Rural Data Portal, Canada Rural Observatory, EC Regular rural impact evaluations in monitoring and evaluation practices.	Over-sampling is often needed in more sparsely populated and remote areas.
Targeting policies for rural firms	Innovation programmes for small and rural, Regional Innovation System, Switzerland Old Firms, Succession Planning, Scottish Enterprise, Scotland	Remote areas have a larger share of smaller and older firms, or firms with strong family ties.
Targeting rural demographics	Women’s entrepreneurship programmes in US, Canada, Switzerland Black Entrepreneurship programmes in US and Canada Indigenous entrepreneurship programmes in Canada Youth entrepreneurship programmes	Remote places may offer different levels of services that may challenge entrepreneurship and innovation for demographics differently. Alternatively, the lack of relevant job opportunities in remote areas may incentivize low growth firms more than in accessible rural areas.
iii. Co‑ordination and Simplification
Simplification and facilitating access	One-stop shops : Find Business Support, Scotland; Business Pathfinder Tool (Federal, Provincial and local), Canada; Business Promotion Guide (Federal), Switzerland Bottom-up initiatives: EC Leader programme	Facilitating access to national resources is often more challenging for rural areas. Bottom-up initiatives can bring a more tailored approach
Horizontal co‑ordination	Access to skills: RIS, Switzerland ; Community Colleges system (CCTT), Quebec, Canada; Rural visa, Canada Access to finance: Finance roundtables, Quebec, Canada; Community Reinvestment Act, USA Access to foreign market: Regional Trade promotion, Scotland	Systems for service delivery are more expensive and require more collaboration in remote rural areas. Furthermore, skilled individuals and migrants in remote areas where there are less community services may find it more difficult to retain foreign or mobile talent. Rural remote have different financial risk and opportunity profiles that need consideration. Remote areas have more difficult access to trade and foreign linkages, than accessible, but both need support in reaching trade centres.
iv. Networks and Linkages for Rural Innovation
Development of entrepreneurial eco-system	Go Forward Pine Bluff, Arkansas, USA; Shorefast foundation, Fogo Island, Canada; Brainport Eindhoven, South Holland	Collaboration and multi-usage facilities as a means to deliver services in RR
Building networks with innovation partners	Interface, Scotland Community College Technology Transfer institutes; Quebec, Canada Nuclear Innovation Institute, Ontario, Canada	Remote areas do not have easy access to universities or large research conglomerates and need to work with either spin offs, industry research labs, or make linkages to resources further away.
Functional area approaches for building scale	1 Billion Build Back Better Regional Challenge, USA; Regional Innovation System, Switzerland; Community Futures Programme, Canada/EC LEADER; Fogo Island Process; Inner Areas strategy, Italy	Remote areas are more dependent on building links, and as such, programmes should facilitate joint applications

Note: The list above is not exhaustive, and several examples may jointly be included in different categories.

Source: Author’s own elaboration based on country case study reports.

Policy actions to boost rural innovation (Box 3.3) revolve around two main considerations:

• Rural regions need the appropriate framework conditions to unlock innovation, which include labour, physical and digital markets, access to finance and government services. Building a level playing field for entrepreneurs in rural regions means reflecting on place-based challenges. It involves improving government capacity, reducing costs of services or local regulations that may hinder effective implementation of policies in rural regions.

• Rural regions can add value by specialising in niche markets and product differentiation. Whereas more concentrated urban economies may be able to use vertical integration to control multiple activities in a GVC, rural economies generally rely on specialisations that focus on one, or very few, parts value chains (Mudambi, 2008[19]). Increased competition from emerging economies calls for a shift to policies that promote differentiation and niche markets instead of low-cost manufacturing.

Box 3.3. Policy Action: unlocking opportunities through innovation

There is significant potential to boost productivity growth, by creating place-based policies to encourage broader entrepreneurial innovations in rural regions:

• Strengthen place-based smart specialisation by supporting diversification within and across related rural sectors. Encourage rural regions to identify and build on their local strengths through smart specialisation strategies that promote innovation across interlinked sectors—such as agri-food, renewable energy, or tourism—aligned with regional potential and global value chains.

• Build rural innovation ecosystems by enhancing rural-urban linkages and clustering firms, entrepreneurs, and research actors. Facilitate collaboration between SMEs, large firms, universities, and innovation hubs through co‑ordinated policies that connect rural regions to metropolitan centres and international markets, boosting knowledge exchange and scaling capacity.

• Improve the business environment and address barriers to entrepreneurship for under-represented groups. Simplify administrative procedures, support SME co‑operation with larger firms, and expand access to tailored entrepreneurship training, especially for women, youth, and disadvantaged groups in rural areas.

• Mobilise social and technological innovation to address rural challenges and service gaps. Support social entrepreneurs in delivering essential services and community-based solutions, while investing in digital infrastructure, emerging technologies (e.g. AI, IoT, decentralised energy), and digital literacy to enable innovation in traditional sectors.

• Expand rural innovation metrics and access to finance to better support local innovators. Develop rural-specific innovation indicators beyond traditional R&D metrics, and remove legal and financial barriers that hinder SMEs and social innovators from accessing funding, participating in networks, and scaling impact.

3.2.3. Policies to enable the digital technology opportunity

Persistent digital connectivity gaps in rural regions demand targeted infrastructure investment and policy action. While broadband coverage in rural OECD regions has improved—with the average rural household connectivity rate reaching 82%, close to 89% in urban areas—significant disparities in speed and quality remain. In 2019, only 59% of rural households in Europe, 67% in Canada, and 77% in the United States had access to fixed broadband with speeds of at least 30 Mbps, compared to 86%, 93%, and 94.4% in the wider population (OECD, 2019[20]). These gaps limit rural access to essential services and economic opportunities. Policy efforts must continue to prioritise rural broadband deployment, especially in remote regions where market incentives are weak, and ensure minimum service standards.

Digital infrastructure alone is not sufficient—rural digital inclusion also requires skills development and support for technology adoption. Limited access to high-speed internet constrains the ability of rural populations to engage in remote work, access e-services like telehealth, or develop digital businesses. More fundamentally, it restricts their participation in the digital economy. Bridging these gaps requires co‑ordinated policies that pair infrastructure investment with initiatives to boost digital skills and promote technology uptake among rural businesses, workers, and institutions. These efforts are critical not only for inclusion, but also for rural economic resilience and competitiveness.

Regional disparities in digital adoption point to the need for place-sensitive policies that promote both access and usage. On average across OECD countries, there is a 7.7 percentage point gap in internet use between the most and least connected regions, with gaps exceeding 20 points in countries like Ireland, Türkiye, and Japan (OECD, 2021[21]). These trends highlight the importance of demand-side measures—such as training, awareness-raising, and SME digitalisation programmes—to ensure that rural communities can make effective use of digital tools. National digital strategies should include specific rural components that address both connectivity and capability.

Closing the rural digital divide opens up new pathways for growth, inclusion, and sustainability—if supported by active, integrated policy. Enhanced digital access enables rural regions to improve public service delivery, diversify their economies, and attract talent through remote work opportunities. It can also reduce emissions through lower commuting needs and support participation in global markets. However, these benefits will only materialise if digital infrastructure and skills are developed in tandem. Policy makers must adopt a holistic approach—integrating broadband planning, education and training, rural entrepreneurship, and service delivery—to ensure digitalisation translates into tangible development gains for rural communities.

Box 3.4. Policy action to make the most of digitalisation

Closing the digital divide requires complementing policies to increase nationwide competition, promoting investment and reducing deployment costs, with policies that embody provision and access to regions often left behind. This includes, for example, supporting:

• demand aggregation models to ensure financial viability of projects,

• public private partnership (PPP) initiatives,

• public funding to expand connectivity in rural/remote areas, including through the use of market mechanisms, such as reverse auctions, to provide funding to market players to deploy their networks in rural and remote areas,

• bottom-up approaches: open access municipal and community-led networks, addressing, in particular, “the last mile” challenges in rural and remote areas, and coverage obligations in spectrum auctions (for wireless networks).

3.3. Tailored policies for economic competitiveness in rural areas near FUAs

Rural areas located near functional urban areas (FUAs) benefit from better access to markets and can tap into the advantages of agglomeration. Such advantages include shared services, infrastructure, and knowledge exchange. Furthermore, these regions are well-positioned to attract a skilled labour force and retain talent, making them fertile ground for economic growth. To unlock this potential, policies need to pay special attention to two areas of opportunity:

Area 1: Manufacturing. This sector plays a crucial role in the economic base of rural regions close to cities, and its continued development is essential for long-term competitiveness. Manufacturing also occurs - though to a lesser extent - in rural remote areas and can also grow with the proper use of new technologies. But proximity to FUAs can enable rural manufacturing to better integrate into broader supply chains and respond more rapidly to market demands.

Area 2: strengthening rural-urban linkages. Collaboration with nearby urban centres and research institutions and foster the development of niche industries and high-value products that benefit from both rural assets and urban linkages. Strengthening these rural-urban connections supports inclusive regional development and resilience. It also enhances the ability of rural areas to diversify their economies while preserving local identities.

3.3.1. Enabling rural industrial development and manufacturing

Rural regions near FUAs are well-placed to lead in high-value manufacturing and tradable sectors, and industrial policy can help them realise this potential. Thanks to their proximity and rural-urban linkages, these rural areas benefit from access to labour markets, innovation centres, logistics hubs, and supply chains—while often offering lower costs for land and operations. As analysed in Chapter 2, they are already major contributors to national manufacturing employment, despite rural regions making up less than a third of the OECD population8. Rural manufacturing complements metropolitan production by supporting supply chains, hosting satellite facilities, and contributing to national economic resilience. These areas are particularly suited for advanced, custom, and circular economy manufacturing, and with the right support, they can play a strategic role in meeting national and global industrial goals.

Industrial policy must align foundational investments in rural competitiveness with sector-specific interventions. To be effective, industrial development strategies should link broader efforts to enhance infrastructure, skills, and services in rural areas with targeted support for key sectors such as manufacturing. Industrial policy can serve as the overarching framework that co‑ordinates rural investment (see Table 3.2), guiding infrastructure and workforce development toward high-impact industries. This strategic alignment enables more purposeful action, including the strengthening of rural–urban linkages. Rural areas near cities are particularly well-positioned to benefit from cluster-based industrial policies that connect local manufacturers with metropolitan supply chains, boosting productivity and innovation through access to urban knowledge hubs. These areas can also attract foreign direct investment (FDI) spillovers from nearby innovation districts, which strengthen local supply chains and facilitate technology transfer. With the right support, such regions can cultivate specialised industrial clusters in advanced manufacturing, green production, and agri-food sectors, leveraging proximity to skilled labour, research institutions, and consumer markets. Examples like medical devices in Tuttlingen, Germany, and high-value textiles in Arezzo, Italy, illustrate how rural manufacturing can flourish when embedded in wider urban innovation ecosystems.

Table 3.2. Policy areas for rural industrial development

	Area	What to do	How it helps
Targeted	Industrial policies	Provide incentives, technical assistance, and capacity-building to modernise rural enterprises,	Integrates rural producers into higher value-added activities.
	Enhance value chain linkages	Facilitate collaboration among actors within specific value chains through roundtables, diagnostics, and strategic planning.	Builds stronger, more cohesive local economies by adding value to rural products and improving co‑ordination.
Enabling policies	Improve access to innovation & technology	Promote rural technology centres, mobile training units, and innovation funds targeted at rural SMEs.	Boosts competitiveness and helps rural firms transition into knowledge-based production.
	Expand rural infrastructure for industry	Invest in logistics, energy, digital connectivity, and processing infrastructure tailored to rural production.	Reduces production and transaction costs, improves market access, and attracts investment.
	Strengthen institutions and governance for rural industry	Establish rural economic councils or platforms for co‑ordination between public, private, and civil society actors.	Facilitates participatory governance and ensures policies are adapted to local realities.
	Adapt environmental and climate policies for rural industries	Integrate climate resilience and sustainability standards into rural industrial development plans.	Ensures long-term viability of rural production in the face of climate risks while opening markets for green products.

Source: Author’s elaboration

Rural places can proactively use diverse place based industrial policies to boost manufacturing, Table 3.3 summarises specific policy levers, which can be deployed with the support of other levels of government but not necessarily relying on top-down measures. The most appropriate interventions depend on the specific rural context and goals, including distance to markets. The more remote the regions, the more the policy approach would need to emphasise co‑operative business models, public-private partnerships, and decentralised SME support structures to compensate for limited market access and labour shortages. To attract investment despite geographic challenges, governments need to implement financial de-risking measures, such as state-backed loans, rural venture funds, and tax incentives to encourage sustainable industrial development.

Table 3.3. Place based industrial policy levers for boosting rural manufacturing

Intervention type	Policy actions
Targeted financial incentives	Provide tax credits for manufacturers adopting green and digital technologies. Establish dedicated rural manufacturing funds to de-risk private investments. Support export-oriented manufacturing through subsidies and international trade facilitation.
Support specific rural-urban linkages	Broker collaboration between local businesses and industry clusters to drive technological adoption and meet urban demand. Public-private partnerships (PPPs) and targeted infrastructure investments can support industrial parks and co-location incentives that strengthen rural-urban production networks.
Specialised infrastructure investments	Establish industrial parks or innovation clusters focused on key manufacturing niches. Develop multi-modal transport links to integrate rural production with urban distribution networks. Expand renewable energy infrastructure to power sustainable manufacturing processes.
Technology adoption promotion	Invest in digital training and Industry 4.0 readiness for rural SMEs. Create partnerships with technology providers to implement automation and digitalisation solutions. Promote digital platforms that connect rural manufacturers to global supply chains.
Tailored workforce development	Expand vocational and technical education programmes tailored to (advanced) manufacturing needs. Foster partnerships between rural colleges and industries to align skills with demand. Support lifelong learning (at distance) initiatives to help workers adapt to automation and technological shifts.

Source: Author’s elaboration

Looking ahead, manufacturing opportunities will evolve, and so must do policy approaches. Supporting rural manufacturing will evolve to be more customised, technology-driven, and resilient, reflecting the structural transformations reshaping global trade, technology, and sustainability.

• Policy Trend 1: rather than applying blanket incentives, governments are likely to continue adopting place-based industrial strategies that leverage the unique comparative advantages of each rural region, such as resource availability, workforce skills, or sectoral (smart strategy) specialisation.

• Policy Trend 2: The rise of digitalisation and remote work will enable more decentralised manufacturing models, necessitating policies that support automation, AI-driven production monitoring, and digital upskilling to ensure rural workforces remain competitive.

• Policy Trend 3: supply chain resilience will take precedence, with governments shifting from simply attracting firms to fostering integrated regional supply networks, particularly as geopolitical shifts and climate risks disrupt global trade.

• Amid these trends, rural policies will focus on land-intensive, resource-based, and decentralised production - while urban areas will continue to prioritise high-density innovation and service-driven economies.

With a clear direction, tackling rural challenges like limited skills pools, slower technology adoption, and fragmented ecosystems become also more tailored to the needs of each place (Table 3.4).

Table 3.4. Areas of opportunity in rural manufacturing and relevant policies

Manufacturing area of opportunity	Why Rural?	Example	Policies for the future (non-exhaustive)
Advanced and specialised manufacturing	Lower land costs, space for specialised facilities, and proximity to regional supply chains.	Tuttlingen, Germany, has evolved from traditional manufacturing to a world-leading hub for medical devices, benefiting from a strong regional ecosystem.	Incentives for R&D decentralisation, export facilitation for niche high-tech products.
Agri-food processing and bio-based manufacturing	Direct access to primary agricultural products reduces transportation costs, and rural areas can integrate vertically with farming and forestry industries	The Biella region in Italy remains a textile hub, leveraging local wool production and sustainable processing methods.	Strengthening farm-to-factory linkages, sustainability regulations for food processing, AI-driven supply chain optimisation.
Green and circular economy manufacturing	Large land availability enables the development of wind turbines, solar panel production, and biomass industries, while proximity to natural resources supports sustainable material production.	Rural regions with high emissions-intensive industries are transitioning into sustainable manufacturing, leveraging cleaner production techniques. (examples of products: renewable energy components, sustainable construction materials, recycling technologies).	Dedicated green investment funds, incentives for low-carbon manufacturing, circular economy tax breaks.
Automotive and aerospace component manufacturing	Many automotive and aerospace suppliers require large production facilities, which are more cost-effective in rural areas, and benefit from proximity to industrial hubs.	Central and Eastern European rural regions have attracted automotive supply chain investments due to competitive costs and skilled labour.	Supply chain relocation incentives, cross-border logistics integration, worker reskilling in automation.

Source: Author’s elaboration. The examples were drawn from OECD (2023), The Future of Rural Manufacturing (OECD, 2023[22])

Box 3.5. Policy actions to strengthen competitiveness in rural near FUAs

Strengthen the foundational enabling factors for competitiveness:

• improve digital & transport infrastructure to facilitate industrial symbiosis with urban industries, including high-speed internet and smart logistics systems.

• Policies to facilitate access to finance for rural SMEs (access to affordable credit and equity investments) to modernise operations.

Develop a specialisation strategy:

• Develop regional industrial strategies that clearly define their niche, identifying industries and product innovations suited to a region’s resources and development level.

• Define operational criteria, such as appropriate policy levers and eligibility of local businesses.

Deploy the right local policy process:

• Engagement local stakeholders to foster a sense of ownership and ensure policies address on-the-ground realities, shaping development visions through clear territorial and multilevel governance structures.

• Promote collaborations between local governments, private sector, and communities to share the responsibility of development projects such as building infrastructure, housing, and business zones in rural-urban interfaces

• Align different policy actions toward measurable goals, setting up monitoring and evaluation mechanisms embedded in PBIP to ensure accountability and adaptability

• Define safeguards to mitigate risks and unintended consequences.

 

Risks to avoid	Policy Countermeasure
1. Overlook local priorities, leading to policy ineffectiveness	Regional consultations, feedback mechanisms for policy design and adjustments.
2. Resistance to change with policies imposed from the top	Engage local stakeholders early in the process, communicate long-term benefits to ease transitions
3. Overlook places’ readiness (e.g. inadequate infrastructure, skills, market integration)	Conduct thorough local assessments and offer capacity-building before industrial programmes. Pair smaller regions with more developed areas in cluster-building efforts.
4. Regional displacement where some gain at the expense of others	Promote wider regional co‑operation, integrate neighbouring regions into broader development strategies
5. Focus too much on a single industry, leaving regions vulnerable to sector-specific downturns	Diversify policy focus across multiple sectors, promote cross-sectoral innovation and adaptability.
6. Underestimate the financial requirements of large-scale transformation projects	Encourage co-funding mechanisms where local, regional, and national governments collaborate.
7. Fund activities that large businesses would have undertaken anyway	Use stricter eligibility criteria and allocate funds to innovation or riskier ventures
8. Large firms take subsidies without significantly changing their behaviour, leading to inefficiencies	Use performance-based subsidies tied to specific outcomes, e.g. local job creation or technology transfer.
9. Local elites or specific interest groups benefit disproportionately, sidelining community needs	Set clear accountability standards, involve a wider set of stakeholders and external evaluators.
10. Unfair value capture by multinationals who relocate production elsewhere after local support	Attach conditions to subsidies or investments, such as local production or job retention commitments

3.3.2. Rural-urban links: innovating to make the most of the proximity to cities

Strong rural–urban linkages are essential to regional resilience and competitiveness. Rural and urban areas are not separate systems—they are interdependent across economic, social, and environmental dimensions. Particularly in regions close to Functional Urban Areas (FUAs), rural economies benefit from ‘borrowed’ agglomeration effects such as access to skilled labour, services, and innovation networks (OECD, 2013[23]). Effective policies must capitalise on these complementarities to support inclusive and balanced territorial development (Table 3.5).

Cities offer productivity gains, but also pressures that create opportunities for nearby rural areas. Urban centres benefit from economies of agglomeration, with denser populations associated with higher productivity—an estimated 1–1.5% increase in central city productivity for each doubling of surrounding urban population within 300 km (OECD, 2015[24]). Yet, urban areas also face diseconomies: congestion, high land prices, inequality, and environmental degradation. These externalities make proximate rural areas attractive alternatives for housing, business relocation, and investment, provided infrastructure and services are adequate.

Table 3.5. Foundations of competitiveness: distinctive needs of rural places (urban vs rural)

Policy Area	Urban Priorities	Rural Priorities
Infrastructure & Land	Focuses on maximising land use efficiency, integrating smart logistics, and ensuring last-mile supply chain connectivity. Implements zoning restrictions and circular economy strategies to optimise land use.	Prioritises expanding transport networks, digital infrastructure, and energy access to overcome geographic isolation. Balances manufacturing expansion with environmental conservation, enabling large-scale sustainable industry projects.
Workforce & skills development	Leverages existing educational institutions, attracts global talent, and supports rapid workforce upskilling through urban innovation hubs.	Requires tailored vocational training, workforce retention strategies, and targeted upskilling in emerging rural industries.
Innovation and industrial clusters	Fosters innovation districts, R&D-intensive clusters, and university-business partnerships.	Strengthens linkages between SMEs, rural-based multinational suppliers, and applied research institutes, often through decentralised innovation hubs.
Business support and finance	Provides direct funding for high-growth tech start-ups and facilitates venture capital investment.	Focuses on de-risking investment in SMEs, offering tax incentives, and improving access to capital and co‑operative financing models.

Source: Author’s elaboration

Rural areas near cities can attract people and firms by leveraging quality of life and affordability. Lower housing costs, environmental amenities, and improved connectivity make rural places close to cities increasingly attractive for residents and businesses. These areas can draw in skilled workers, particularly through remote and hybrid working models, and support enterprise development by providing access to space and infrastructure at lower cost.

Innovation in peri-urban rural regions is crucial to harness agglomeration spillovers. Innovation tends to cluster spatially, benefitting from proximity to knowledge, skilled labour, and infrastructure (Breschi, 2008, pg. 168). Rural areas near cities must therefore not only adopt urban innovations, but also adapt them to local needs. Their ability to do so hinges on access to digital infrastructure, skilled workers, and active participation in regional innovation networks.

Remote working can reconfigure settlement patterns and unlock rural labour markets—but requires investment. Although remote working surged during the COVID-19 pandemic, uptake was lower in rural regions due to limited connectivity and job structures unsuited to remote tasks. In 2020, remote working rates were nearly double in urban areas (15.7%) compared to rural (8.7%). Still, remote work presents a structural opportunity to diversify rural labour markets and support inclusivity—particularly for women, carers, and people with disabilities. Policy support is needed to address digital skills, connectivity, and service provision.

Strengthened rural–urban co‑ordination is vital for effective spatial planning and service delivery. Planning systems must address shared challenges and manage interdependencies in housing, transport, and environment across rural–urban boundaries. Co‑ordinated infrastructure investment, joint governance platforms, and integrated land-use policies can help manage urban spillovers and ensure rural areas benefit from growth, rather than being marginalised.

Rural–urban linkages must be made central to circular economy and green transition strategies. Proximity to markets gives rural areas near cities an advantage in circular bioeconomy sectors such as food, energy, and waste processing. Policies should target these synergies through joint rural-urban strategies, including shared logistics, resource recovery networks, and green infrastructure investments that span functional regions.

Box 3.6. Policy actions to leverage rural-urban linkages

1. Maximise the benefits of remote and hybrid working models

• Expand broadband and mobile infrastructure in rural areas to enable remote work uptake.

• Develop rural co-working hubs, drawing from successful models in Ireland and Japan.

• Provide training in digital tools for workers and SMEs, particularly in underserved regions.

• Support work–life balance infrastructure (e.g. childcare) to make remote work inclusive.

2. Integrate rural–urban strategies in spatial planning and service delivery

• Align land-use policies to manage growth pressures and avoid urban sprawl.

• Foster inter-municipal co‑operation to co‑ordinate housing, mobility, and service delivery.

• Prioritise regional transport investment that links rural areas to urban job and service markets.

3. Strengthen innovation linkages and knowledge flows

• Support collaboration between rural SMEs and urban universities or research centres.

• Develop decentralised innovation hubs to embed R&D capacity in rural areas.

• Promote digital platforms to link rural entrepreneurs with urban markets and support services.

4. Embed rural–urban linkages in green transition and circular economy efforts

• Incentivise rural participation in bio-based value chains and waste recycling networks.

• Invest in shared infrastructure for renewable energy, sustainable logistics, and water management.

• Encourage cross-jurisdictional climate resilience planning, integrating rural perspectives.

3.4. Tailored policies for economic competitiveness in remote rural

3.4.1. Reducing distance to markets

Remote rural regions are vital to national economies, supplying raw materials, preserving cultural and environmental assets, and attracting tourism. However, their distance to large markets and low population density presents challenges, including high infrastructure and service delivery costs and limited economies of scale, which impact innovation. There are two ways to reduce the distance to markets by physical proximity and by digital connectivity.

Reducing digital distance ICT work on digital divides

Without direct access to high-speed internet, rural communities face challenges in acquiring knowledge and skills, accessing e-services (like telehealth initiatives), participating in democracy, communicating digitally, working remotely, and creating, or indeed, offering their skills to digitally intensive firms. The digital divide also stifles innovation, business development and the potential for existing firms to grow. Bridging digital divides in access to broadband and in digital skills will be paramount for rural regions to fully leverage the benefits of digitalisation. Investment in digital infrastructure and skills will also help rural areas exploit the benefits of the digitalisation of work and social interactions and in particular, remote working.

Improving digital infrastructures and digital accessibility can bring about opportunities for rural regions. Access to quality broadband is crucial for accessing essential services, boosting well-being, driving entrepreneurship, innovation, growth and productivity. In addition, it can help leverage on the opportunities presented by remote working, including reduced transport-related emissions, greater flexibility of working, improved attractiveness for skilled workers and entrepreneurs to move to rural areas. Digitalisation can reduce trade times and costs, enhance the exchange of new types of products and services, and allow new ways to work and join the labour market. Without active policies to close the digital divide, it can lead to greater territorial inequalities, especially in terms of digital skills, productivity, or access to public services. For example, low-speed networks (less than 20 Mbps) are a barrier in the adoption of many technologies, including advanced telemedicine and cloud computing.

Box 3.7. Policy action reducing distance to markets

Improving infrastructures

Closing digital divides requires complementing policies to increase nationwide competition, promoting investment and reducing deployment costs, with policies that embody provision and access to regions often left behind. This includes, for example, supporting:

• demand aggregation models to ensure financial viability of projects,

• public private partnership (PPP) initiatives,

• public funding to expand connectivity in rural/remote areas, including through the use of market mechanisms, such as reverse auctions, to provide funding to market players to deploy their networks in rural and remote areas,

• bottom-up approaches: open access municipal and community-led networks,

• addressing, in particular, “the last mile” challenges in rural and remote areas, and

• coverage obligations in spectrum auctions (for wireless networks).

3.4.2. Capitalising on natural resources

Natural resources have been important drivers of national and regional growth across OECD. For example, in Chile mining activities accounted for 58% of the country’s total exports (International Trade Administration, 2023[25]) and in Australia, mining exports accounted for 66% of the country’s total export revenue in 2022-2023 (Minerals Council of Australia, 2023[26]). Rural regions, particularly remote ones, are the primary suppliers of raw materials, food, water, and energy that countries produce and consume. For example, among the 50 OECD mining regions, 40 are classified as rural remote or close to small cities.

In the context of increasing strategic importance of national self-sufficiency in raw materials, demand for domestic mineral, energy, and forestry supply is rising. This creates both opportunities and challenges for resource-rich communities to leverage their natural assets to increase community well-being and unlock business opportunities.

Regions specialized in natural resources, such as mining and forestry, have a lower share of unemployment and higher GDP per capita outcomes. Amongst the benchmark of 40 regions that specialize on mining activities their GDP per capita is on average 19% higher than of rural regions (OECD, 2023[27]).

However, regions specialized in resource sectors face various socio-economic and environmental challenges associated to the international scope of these activities, the small markets of the host rural economies and the capacity of local governments and communities to reach beneficial agreements with companies and plan with a forward-looking approach.

Stemming from these structural characteristics, main negative externalities for rural remote regions relying on natural resource sector include:

• Lack of economic diversification and volatile economies. A high local specialisation on resources can lead to “Dutch disease effects”, exemplified in the decline of other economic activities locally and entrepreneurship along with increasing production costs for new businesses. Given that resource sectors are reliant to international markets, high specialized local economies are vulnerable to market volatility due to ‘boom-bust’ cycles (Papyrakis and Raveh, 2014[28]; Muhammad Shafiullah et al., 2018[29]); (Mateo-Peinado, 2022[30]).

• Economic inequalities and low value for local economies. Resource sectors in rural regions often offer higher wages than other industries, yet economic benefits are unevenly distributed. Those outside mining frequently face higher living costs without wage advantages, deepening inequalities between workers and non-workers in the resource sector, fly-in fly-out employees and local communities, and Indigenous and non-Indigenous populations. In some traditional resource communities, disparity man-women persist given working cultures or less incentives for women to work. Small local markets further strain public services, exacerbating challenges in education and healthcare access.

• Lock-in effects for local companies. The high income and the size of the resource business in a remote community tend to create dependency relationships with local business, who ended up being providers to that single company. Given that local companies in small rural economies are mostly family own or SMEs, staff and technical capacity is limited to open markets in other business or benefit from the international structure of the resource company to find international opportunities.

• Impacts to local environmental assets. All resource activities are intensive in the use of natural resources, including land and other inputs such as water, they modify landscapes and environmental ecosystems. Some of these industries produce hazardous waste and air pollution that require special care.

On top if this, these sectors are also becoming highly capital and digitally-intensive given their competition in global markets The technological innovation in resource sectors can bring various benefits, including new job opportunities in high value-added tasks, help mitigate the shortages of workers in remote regions mining operations, and more efficient use of resources and reduction of the environmental impacts of mining. However, if these communities are not prepared in advance, technological change in these industries can hamper participation of local workforce in these activities and limit the involvement of local business.

Therefore, main policy priorities to capitalise on natural resources for greater well-being and competitiveness of rural remote communities include: i) leveraging resource project to add value to local economies, ii) promotion of smart diversification and iii) subnational governance to link resources with local priorities.

Leverage resource sector to add value to local economy:

Resource activities do not limit to the extraction itself, but they encompass a variety of activities across upstream phases, such as exploration, construction of production sites and extraction, and downstream phases, such as manufacturing or sales and distribution. Furthermore, in the context of the green transition, there are increasing added value opportunities for rural remote areas through sustainable practices such as circular economy activities. Raw materials are at the start of many industrial value chains, including construction, steel or metallurgy, and present properties of durability, recyclability and adaptability which make them apt for circular production systems (Young, Barreto and Chovan, 2021[31]).

Therefore, regions need to strengthen local economic linkages with resource sector activities to bring benefits to communities including employment and investment. Given that circular activities are often outside the core business of resource companies, these activities offer businesses opportunities for regional companies, entrepreneurs, and researchers. In mining it can translates into revalorization of tailings, repurposing of closed mines, reuse of wastewater or mineral equipment. For instance, Mount Morgan in Australia has benefited from reprocessing mining waste to unlock economic gains and reduction of environmental damage for this region Box 3.8.

In forestry regions, similar activities can include the establishment of biomass and bioenergy processing plans converting forestry residue into biofuel or mushroom cultivation using wood residue. For instance, the Fort St James Green Energy Project in British Colombia is a bioenergy plant situated in a forestry region, utilizing wood waste and supplying electricity to the local grid, employing 30 high skilled employees (BioNorth Energy, 2024[32]).

Other regions are also leveraging partnerships with resource companies to enhance the local business ecosystem, with private-public programmes to upscale local providers, through technological transfer agreements, and to increase local procurement. In Chile, the world-class provider programme led by a private and public mining company in co‑operation with the government set capacity building activities to local providers to address a specific industrial need of the industry.

Box 3.8. Mount Morgan mine waste repurposing

The Mount Morgan mine waste repurposing project in Queensland, Australia, is an innovative initiative focused on transforming historical mining waste into valuable resources. The Mount Morgan site, once a highly productive gold and copper mine, left behind large amounts of acidic mine waste that have posed environmental challenges for decades. However, through new technological advancements, companies are now reprocessing this waste to extract remaining precious metals, reducing environmental hazards and creating economic value. The repurposing efforts also aim to rehabilitate the site and improve local water quality, benefiting surrounding communities and ecosystems.

Smart diversification of resource rich economies

Supporting economic diversification and entrepreneurship in resource specialised regions is a main priority to build long-term economic resilience. To this end, there are a number of common focus points that can assist in the diversification process of remote rural economies:

• Identifying Local Assets: Resource regions tend to have other environmental, geographical, and cultural assets on which they can capitalise, including geographic conditions for renewable energy sectors (wide open spaces and wind and solar capacity), niche tourism or scientific activities. For example, in Antofagasta, Chile, the region boasts exceptional conditions for astronomical research and tourism star-gazing. The region hosts several observatories (e.g. Gemini Sur, Paranal) and research centres, attracting scientists and astronomers (OECD, 2023[33]).

• Tailored SMEs and entrepreneurship support in resource context: Assistance can include loan programmes for new business projects, establishment of business support centres, or hosting relevant workshops/events. Training and education in new sectors through existing education institutions is essential upskilling the workforce for new sectors. Private sector can be instrumental in supporting diversification, and there are positive examples in the mining sector such as the entrepreneurship programme of the Zinkgruvan Mine in Orebro, Sweden.

Box 3.9.  Zinkgruvan Mining's Entrepreneur Program: Fostering local resilience

Launched in 2018 by Zinkgruvan Mining, the Entrepreneur Program, also known as Zinkgruvan Mining ReThink, aims to bolster the local economy by fostering entrepreneurship and preparing the community for a future beyond mining. This innovative initiative is led by the company in collaboration with local stakeholders to mitigate the economic impact of potential mine closures.

The programme works by providing mentorship and support to local businesses, particularly those not directly related to mining. Through workshops, personalized guidance, and networking opportunities, the programme equips businesses with the skills and knowledge necessary to thrive independently. Notably, during the COVID-19 pandemic, the programme played a crucial role in ensuring the survival of participating companies by offering additional support and resources.

Outcomes of the Entrepreneur Program have been significant, with over 40 local businesses benefiting from mentorship and support. These companies have reported higher success rates and resilience compared to those not involved in the programme. By fostering a diverse and robust local economy, Zinkgruvan Mining's initiative not only supports current economic stability but also promotes the long-term sustainability of the community.

• Forward-looking planning with tailored funding: National and regional governments and authorities can provide a foundation for diversification by creating forward-thinking strategic plans that promote experimentation. This can include providing diversification funds for investments in infrastructure, skills training, and business development. The diversification of Tumbler Ridge in British Colombia, Canada provides a useful example of diversification efforts Box 3.10.

Box 3.10. Tumbler Ridge Diversification from Coal

Tumbler Ridge, a mining town in British Columbia, pursued economic diversification by capitalising on its unique natural and cultural assets. After the first coal mining downturn, local stakeholders rebranded the town as an outdoor recreation and tourism destination, promoting activities such as hiking and rock climbing in the Rocky Mountains. The discovery of significant dinosaur fossils nearby led to the establishment of a paleontological museum and a successful bid for UNESCO Global Geopark status, attracting geotourism. Additionally, Tumbler Ridge invested in alternative sectors like wind energy and forestry, and it developed a community forest license to retain local control over forest resources. This multi-sector approach aimed to create a stable economy less vulnerable to mining’s cyclical downturns.

Proactive governance to link resource sectors with local priorities.

Proactive governance to co‑operate with resource companies and ensure right local conditions to benefit from these sectors is needed to make the most of these sectors and ensure long-term development beyond the depletion of the resources. To this end some policy action include:

• Subnational tailored resource strategies: While normally resources are governed by national authorities, in unitary countries, subnational policies to improve the links of the sector locally are instrumental to provide better indication of the role of mineral-related activities in the local economy. These strategies help to agree with regional actors on the role of resource sector for development, ease local regulations for resource projects (e.g. clearer land-use plans), better communicate the potential benefits of these activities and define tools to mitigate negative effects. Andalusia’s Mining Regional Strategy is a good example in setting long-term goals for the sector in the local economy and define actions to enhance local value added and employment linked to this value chain (Box 3.11)

Box 3.11. Andalusia’s Mining Regional Strategy

Andalusia's Mining Regional Strategy sets a benchmark for long-term planning by aligning economic, social, and environmental goals. It focuses on modernizing the mining sector promoting the region's potential and integrating sustainable practices while preserving it mining heritage. By fostering collaboration among stakeholders, the strategy ensures mining becomes a driver of sustainable growth and development.

A key pillar of the strategy is enhancing local value added by supporting the entire mining value chain, from mineral extraction to processing and service innovation. To maximise economic benefits for the region, the strategy is committed to processing minerals locally, particularly from the Iberian Pyrite Belt. It also aims to create 10 000 direct and 30 000 indirect jobs while offering specialized training programs to develop skills for sustainable and innovative mining.

By integrating environmental preservation, promoting sustainable practices, and addressing social concerns, the strategy mitigates mining's potential negative impacts. With €3.2 billion in annual business opportunities and global demand for sustainable materials, Andalusia is positioning itself as a leader in responsible mining and regional development.

Source: OECD, Mining Regions and Cities Case Study, Andalusia, Spain, 2021

• Multi-actor governance structures to manage resource strategies: Resource activities, such as mining and forestry, can span decades—some lasting up to 100 years. Therefore, strategies to govern such operation require long-term vison, clear goals, and structures for continuous monitoring and adaptation. Community-based boards and organizations should be established and funded to facilitate regional, cross-sectoral collaboration, bringing together government bodies, universities, communities, environmental experts, companies, and Indigenous peoples. Their involvement in monitoring and evaluating regional development strategies ensures resource projects align with sustainability goals and community interests (Vella et al., 2015[34]).

• Capacity building and resourcing: To ensure involvement of regional actors including Indigenous rights holders, NGOs, local communities, and others in aligning regional objectives with economies activities requires ensuring these groups have the appropriate resourcing and capacity to engage in discussions. Governments and companies can invest in capacity building programmes and workshops to equip groups with the necessary resources.

• Community co-ownership of resource projects: Providing communities and rights holders the financial and capacity support to engage as equity or partner owners in resource projects can be beneficial to ensure social license to operate and prevent environmental and social damage. This is particularly instrumental in resource projects that occur in Indigenous lands. For example, Yindjibarndi traditional owners in the Pilbara, Western Australia have partnered with a renewable energy company to operate a large-scale renewable energy project, with traditional owner equity participation of 25% to 50% as well as Yindjibarndi approval for all project sites to protect cultural heritage (OECD, 2023[35]).

• Facilitating cross-regional knowledge sharing: Through sharing best practices and data with similar municipalities, rural remote areas can learn from each other’s experiences and potentially collaborate on programmes and policies. An example of this is the Mineral Resources Cluster Portugal that brings together mining companies, research institutions, regional government agencies, and support industries to collaborate on enhancing value from extraction projects (Mineral Resources Cluster Portugal, 2024[36]). A similar consortium is possible to group rural remote areas that specialize in similar industries or share common challenges in improving economic prosperity (lack of diversification, out-migration etc.).

Box 3.12. Policy Actions to leverage natural resources for competitiveness in remote rural areas

Main actions to capitalise natural resources for greater competitiveness and well-being of remote rural regions include:

• Leveraging resource activities to create local value by strengthening links between resource companies, local businesses, research institutions, and entrepreneurs, forming partnerships with companies to upscale suppliers and promote local procurement, and implementing incentives to attract companies at different stages of the value chain.

• Supporting economic diversification based on resource sector assets and related activities by identifying local strengths beyond resource specialization through bottom-up strategies, promoting programs to support entrepreneurs and local businesses in non-resource sectors, and establishing forward-looking planning in collaboration with companies.

• Establishing governance structures to link resource sectors with local priorities by developing subnational tailored resource strategies to agree on the role of resource sector for development and ease local regulations for resource projects (e.g. land-use plans), creating multi-actor governance structures to manage resource strategies and allowing opportunities for community co-ownership structures of resource projects.

3.4.3. Inclusion of Indigenous peoples in natural resource development

Indigenous peoples are central actors to help rural regions capitalize on natural resources, as natural resources in some OECD countries are located in Indigenous lands. Many Across Australia, Canada, Mexico, New Zealand, and the US a higher proportion of Indigenous peoples (44%) live in predominantly rural regions compared to non-Indigenous peoples (25%) (OECD, 2019[37]). Many of these remote regions contain natural resource endowments that are critical for national economies. On average, across Australia, Canada, Chile, and Sweden, mining regions are home to almost one third (28%) of these countries’ Indigenous peoples. Globally, over half the critical minerals resource base required for the green transition is located on or near Indigenous lands (Owen et al., 2022[38]).

The resource sector activities often significantly impact Indigenous culture and livelihoods. Many projects have dispossessed Indigenous peoples from their land and disconnected them from cultural sites and areas integral to livelihoods such as fishing and hunting sources. While there has been significant advancement in frameworks for Indigenous engagement within resource regions including changes in international and national legislation, the socioeconomic marginalisation of Indigenous peoples continues in these areas. This is largely due to a gaps in government implantation and enforcement of the free, prior, and informed consent (FPIC) as outlined in the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP). On top of this, other factors that have led to this situation include:

1. Unequal relationships between resource companies and Indigenous peoples

2. Insufficient support for capacity building in Indigenous communities

3. Lack of meaningful consultation with Indigenous groups

4. Lack of investment in Indigenous self-determination

At the pre-conference of the 2024 OECD Mining Regions and Cities in Sudbury, Canada, 35 Indigenous peoples from 4 countries gathered. They developed an Indigenous Call for Action. This document identifies 10 action that can improve opportunities and outcomes for Indigenous peoples living in a mining context, with some being pertinent to Indigenous liveability in region specialised in other resources sectors (Box 3.13).

Box 3.13. Policy Action: Advancing Indigenous Inclusion in the Resource Sector

Building on previous OECD work on integrating Indigenous perspectives in regional development (OECD, 2019), this Indigenous-led Call to Action outlines key policy actions to ensure Indigenous communities are full participants and beneficiaries in the resource sector. These recommendations were developed by Indigenous leaders at the 2024 OECD Conference on Mining Regions and Cities and, while focused on mining, they are also applicable to improving Indigenous inclusion and well-being across other resource sectors. The proposed actions emphasize strengthening Indigenous rights, economic empowerment, and environmental stewardship:

• Recognizing Indigenous sovereignty and governance by embedding Indigenous laws, traditional knowledge, and decision-making authority in mining projects.

• Strengthening Free, Prior, and Informed Consent (FPIC) through legally binding mechanisms, ensuring Indigenous communities can assess, renegotiate, or decline projects based on evolving impacts.

• Expanding Indigenous economic participation by increasing equity ownership opportunities, creating Indigenous business coalitions, and ensuring procurement policies prioritize Indigenous-led enterprises.

• Investing in Indigenous capacity-building by providing financial and technical support for legal, financial, and environmental expertise, ensuring Indigenous communities can fully engage in mining-related negotiations.

• Enhancing employment and workforce development through targeted Indigenous hiring, mentorship programs, and culturally responsive recruitment and retention strategies.

• Integrating Indigenous knowledge in environmental planning by requiring Indigenous-led monitoring, mine closure planning, and transparent environmental impact reporting.

• Promoting Indigenous-led regional planning by fostering Indigenous economic coalitions and regional governance frameworks that support long-term, sustainable community development.

• Ensuring community safety and well-being by implementing protective measures against risks such as human trafficking, substance abuse, and violence associated with resource development projects.

• Empowering Indigenous leadership in mine remediation by funding and supporting Indigenous-led reclamation initiatives for abandoned mines, integrating traditional land-use practices.

• Increasing Indigenous representation in global resource governance by ensuring Indigenous professionals participate in decision-making, policy forums, and international industry standards development.

This Indigenous-led Call to Action emphasizes the need for governments and industry to move beyond consultation toward true partnerships, ensuring Indigenous peoples' rights, knowledge, and priorities shape the future of resource development.

Source: Indigenous Call to Action: Indigenous-led Pathways for Sustainable Futures in Mining Regions, 2024. Indigenous Call to Action: Indigenous-led Pathways for Sustainable Futures in Mining Regions

3.4.4. Unlocking tourism opportunities in remote regions

Tourism plays a pivotal role in supporting economic diversification and social inclusion in rural regions. Across OECD countries, tourism offers rural communities pathways to diversify beyond traditional sectors such as agriculture, creating new jobs, supporting local businesses, and fostering economic resilience. It also delivers important social benefits by offering employment opportunities to youth, women, migrants, and marginalised workers. As a labour-intensive sector, tourism can help rebalance shrinking and ageing rural labour markets, and—when designed inclusively—improve community well-being and cohesion (OECD, 2024[39])..

The impacts of tourism differ between rural areas near cities and remote regions, requiring tailored approaches. Rural areas near cities benefit from easier access and frequent visits, including day trips and weekend getaways. While this stimulates local economies, it also risks over-tourism, rising second-home ownership, and the erosion of rural character and culture. These effects can strain infrastructure, raise housing prices, and alter the identity of local communities (OECD, 2024[39]). In contrast, remote rural areas offer more immersive and culturally distinct experiences, with unique ecosystems, where tourism can help preserve local traditions and environmental assets. However, these areas face greater challenges in accessing markets, maintaining year-round visitor flows, and funding infrastructure. They are also more vulnerable to external shocks—such as natural disasters or travel restrictions—and the growing impacts of climate change. When such economies are reliant on tourism, such shocks can affect local livelihoods and economic stability (Dasgupta and Morton, 2014[40]).

Targeted rural tourism strategies can support economic resilience while protecting local identity. Tourism in rural areas—especially in remote communities—must be managed to maximise benefits while limiting social and environmental risks. Investment in sustainable infrastructure, improved digital connectivity, and support for local tourism entrepreneurship are essential. Importantly, rural tourism strategies should reflect the distinct assets of different rural places, including their environmental, cultural, and Indigenous heritage, and be integrated into broader regional development plans.

Different types of rural tourism offer distinct opportunities for inclusive and sustainable development.:

• Social Tourism. Social tourism promotes travel opportunities for all, including marginalized groups, while fostering economic and social benefits for local communities. It helps boost local economies by creating jobs and supporting small businesses, reduces seasonality by ensuring year-round tourism demand, enhances accessibility for disadvantaged groups, and strengthens local communities by encouraging inclusive tourism development (OECD, 2024[39]).

• Cultural tourism offers significant benefits by preserving heritage, supporting local economies, and fostering intercultural exchange. It helps safeguard traditions, arts, and languages by generating revenue that can be reinvested in cultural sites and practices. This form of tourism also creates jobs, particularly for artisans and cultural practitioners, strengthening local economies. By promoting authentic cultural experiences, it enhances mutual understanding between visitors and host communities, fostering respect and appreciation for diverse traditions. Additionally, cultural tourism empowers local communities by encouraging active participation in heritage conservation and sustainable tourism development (OECD, 2024[39]).

• Environmental tourism provides numerous benefits by promoting conservation, supporting local economies, and encouraging sustainable development. It helps protect natural ecosystems by funding conservation efforts and promoting eco-friendly practices such as waste reduction and renewable energy use. This form of tourism creates jobs in conservation, hospitality, and eco-tourism sectors, benefiting local communities and small businesses. By raising awareness about environmental issues, it fosters a sense of responsibility among both tourists and residents. Additionally, environmental tourism supports climate change adaptation efforts and contributes to sustainable development goals by balancing economic growth with ecological preservation (OECD, 2024[39]) (Box 3.14).

• Indigenous tourism plays a vital role in preserving and sharing Indigenous culture while driving economic growth for Indigenous communities. By showcasing traditional knowledge, arts, and heritage, it fosters cultural pride, promotes intercultural dialogue, and ensures traditions are passed down through generations. When managed respectfully, Indigenous tourism supports sustainable development while empowering communities. In Canada, the sector was hit hard by the pandemic, prompting initiatives like national urban parks, conservation partnerships, and the CAD 20 million Indigenous Tourism Fund to help Indigenous tourism recover and thrive in a way that aligns with cultural values and long-term community goals. (Box 3.15).

Box 3.14. New Zealand’s Tourism Adaptation Roadmap

New Zealand’s Tourism Adaptation Roadmap integrates tourism with environmental preservation by promoting climate resilience, biodiversity conservation, and sustainable infrastructure. Aligned with the National Adaptation Plan, it encourages low-carbon tourism, protects natural resources, and involves local communities in decision-making. This approach ensures tourism supports both economic sustainability and environmental protection.

Source: OECD, OECD Tourism Trends and Policies, 2022, Policy Highlights, OECD Publishing, Paris https://doi.org/10.1787/a8dd3019-en

Box 3.15. Indigenous tourism partnerships in Canada

Strengthening Indigenous tourism is a central focus of Canada’s new Federal Tourism Growth Strategy. To support the industry’s recovery and long-term, sustainable growth, the government is investing CAD 20 million into the Indigenous Tourism Fund. This initiative aims to help Indigenous tourism bounce back from the pandemic and strengthen its position in the market. Additionally, as part of the 2023 budget, a portion of the CAD 108 million Tourism Growth Program will be allocated to further investments in Indigenous tourism experiences. Before the pandemic, Indigenous tourism was one of the fastest-growing sectors in Canada, with notable increases in job creation and GDP contributions. The new funding is intended to meet the rising demand for authentic Indigenous experiences, ensuring that Indigenous tourism continues to grow and thrive in a sustainable way. (OECD, 2024[39])

Tourism can bring economic benefits to rural communities but also poses significant challenges:

• Environmental impacts: High tourist numbers can strain natural resources like water and land, leading to pollution, habitat destruction, and biodiversity loss (OECD, 2024[39]).

• Over-reliance on tourism: Heavy dependence on tourism makes rural economies vulnerable to disruptions. The COVID-19 pandemic led to the closure of 90% of world heritage sites and museums, with lasting socio0economic consequences (UN Tourism, 2020[41]).

• Rising living costs: Increased demand for housing and services drives up costs, making it harder for residents and local businesses to stay profitable (OECD, 2024[42])

• Infrastructure strain and seasonality: peak seasons overburden roads, healthcare, and waste management, while off-seasons leave resources underutilized, creating inefficiencies.

• Cultural and heritage erosion: heavy foot traffic and commercialization can damage historical sites and alter local traditions, threatening their long-term preservation (OECD, 2024[42]).

• Promoting tourism policies tailored to rural characteristics. Tourism policies with rural focus can help identify assets in rural territories and define measures according to their needs. For example, Portugal’s Tourism Agenda for the Inland 2023 stimulates the tourism sector in inland Portugal with initiatives designed to connect territories, enhance local resources, and invest in businesses and tourism offerings, with a dedicated budget (OECD, 2024[39]). In the United States, the Recreation Economy for Rural Communities programme has supported 25 small and rural communities in 17 states to develop strategies to increase outdoor recreation economies, a key objective of the National Travel and Tourism Strategy.

Policy frameworks must strengthen the enabling conditions for rural tourism to thrive. Governments should develop integrated rural tourism strategies that connect tourism policy with transport, digital infrastructure, housing, and environmental planning. Investments in accessibility—both physical and digital—are crucial, especially for remote regions. Targeted support for tourism-related SMEs, skills development in hospitality and cultural sectors, and place-based branding initiatives can also reinforce the competitiveness of rural destinations. Finally, rural tourism strategies must embed sustainability, avoid overdependence on external visitors, and include mechanisms to protect the cultural and environmental assets that underpin rural attractiveness.

Rural tourism strategies can find innovative ways of attracting visitors while benefiting local communities and ecosystems. Countries are increasingly finding creative ways to boost tourism and make less-populated or less-visited regions more accessible to both international and local tourists. For instance, Korea's Digital Tourism Card initiative attracts visitors to areas facing population decline by offering discounts on accommodation, meals, and experiences. This strategy not only stimulates tourism in these underserved areas but also ensures international tourists are well-informed about the region's offerings through digital platforms. By encouraging tourists to explore new destinations, such initiatives can deliver significant economic and social benefits to local communities, as long as they are supported by proper planning and adequate resources (OECD, 2024[39]). Managing these challenges is crucial to ensuring that tourism supports, rather than harms, rural communities.

Box 3.16. Policy action to unlock tourism opportunities in rural remote

To address the challenge of unbalanced tourism and leverage their benefits for long-term local growth, governments can implement tailored policies and investments to promote regional attractiveness and encourage visits through a number of to tailored actions:

• Promoting tourism policies tailored to rural characteristics. Tourism policies with rural focus can help identify assets in rural territories and define measures according to their needs. For example, Portugal’s Tourism Agenda for the Inland 2023 stimulates the tourism sector in inland Portugal with initiatives designed to connect territories, enhance local resources, and invest in businesses and tourism offerings, with a dedicated budget (OECD, 2024[39]).

• Incentives for tourism in less-populated areas. Countries are increasingly finding creative ways to boost tourism and make less-populated or less-visited regions more accessible to both international and local tourists. For instance, Korea's Digital Tourism Card initiative attracts visitors to areas facing population decline by offering discounts on accommodation, meals, and experiences. This strategy not only stimulates tourism in these underserved areas but also ensures international tourists are well-informed about the region's offerings through digital platforms. By encouraging tourists to explore new destinations, such initiatives can deliver significant economic and social benefits to local communities, as long as they are supported by proper planning and adequate resources (OECD, 2024[39]).

• Capitalising on natural assets for tourism. Remote rural areas benefit from natural assets such as farmland, forests, waterfalls, and natural landscapes that can offer authentic experiences to tourists For example, building on its unique natural and cultural assets, Hidalgo, Mexico, is strategically leveraging its resources and branding to expand its tourism sector and drive regional economic growth.

Linking environmental and tourism goals. Eco-tourism models stimulate economic growth but also foster environmental conservation, creating opportunities for rural communities to thrive while maintaining their natural heritage. While tourism plays a critical role in achieving these climate goals, much more needs to be done to support green transition tourism sector. For example, countries like Greece, New Zealand, Norway, and Slovenia are already integrating climate action into their national tourism strategies.

3.5. Policies for quality service delivery

As shown in Chapter 2, rural regions display significant gaps in access and quality of essential services. These include education, health, digital broadband and housing. In parallel rural regions are facing higher demographic pressures with shrinking and ageing populations. These pressures will further increase in the future. All things equal, delivering high-quality services in in rural places with more dispersed settlement patterns and lower population densities is more costly at the unit level all things equal. In other words, geography plays a decisive role in determining access to these services.

The provision of quality services is critical to the future of rural communities. It determines the quality of life of rural citizens and their ability to attract firms and workers to these places. Without them rural futures will be daunting. Designing effective policy response by realising the benefits of economies of scale, economies of scope, targeting services at the right scale, making the most of digital solutions, fomenting innovation and putting in place good practices are needed to meet the higher costs and delivery sustainable solutions.

Table 3.6 highlights good policy practices and examples from OECD countries that address key challenges related to service delivery in rural areas. It covers five critical sectors, including education, healthcare, transport, broadband connectivity/digitalisation, and housing, that illustrate innovative approaches and effective strategies to enhance accessibility, efficiency, and quality of services in both rural areas close to FUA and remote regions.

Table 3.6. Social pillar: examples of good practices across OECD countries

Policy area	Country, Region	Description
Education	Finland, Päijat-Häme	Municipalities in the region entered into a co-operation agreement to develop a network-based comprehensive school system that offers high-quality teaching services online to all children irrespective of their geographic location.
	Canada, Quebec	The project Networked Schools (L’École en réseau) allows students and teachers in small and remote schools to learn and collaborate via ICT tools such as videoconferencing, enabling the formation of learning communities and augmenting pedagogical approaches.
	Colombia, Valle del Cauca	The "Learning Communities" initiative, implemented since 2014 in some municipalities in Valle del Cauca and other Colombian departments, allows better integration of local communities - via committees made up of teachers, parents, and students – in educational decision-making (on school life, academic matters, including curriculum design and evaluation, cultural activities, school infrastructure and pedagogical tools).
	Portugal, Alentejo	A project involving the municipalities of Almodovar, Mértola, Castro Verde, Aljustrel and Ourique has developed a vocational training offer to match the labour market needs and to articulate the students’ mobility services, as a mean of preventing both desertification and students’ dropout.
	New Zealand	The Kāhui Ako (Learning Communities) initiative brings rural schools together with their urban counterparts to share teaching expertise and resources, particularly in areas such as digital literacy and specialist curricula that can be difficult for rural schools to implement independently.
Healthcare	Italy, Veneto	The region has been successful in responding to local health needs through a combination of strengthening primary care, integrating care, increased use of health technology, and increasing patient participation.
	Colombia, Cauca	An obstetric intensive care unit project in 14 municipalities in northern Cauca, promoted by the Valle de Lili Foundation, allows specialist doctors to assist general practitioners or other specialised doctors telematically.
	Spain, Basque Country	The region has implemented a number of integrated care principles for care co-ordination and structural integration, including merging hospitals and primary care structures into Integrated Healthcare Organisations.
	Australia	Clinical networks provide a range of services to the rural population while seeking cost savings from resource efficiencies in areas such as purchasing or administrative costs. The country has also adopted the hub-and-spoke model for emergency care, with patients stabilised in smaller hospitals and transferred for more intensive care to larger central hospitals.
	France	In the “multi-professional Health Houses”, doctors and medical auxiliaries work in a co-ordinated manner as close as possible to the rural population through the sharing of skills.
	Netherlands, Groningen	Groningen has established platforms for collaboration among healthcare organisations and providers, and created the role of “village supporter”, connecting formal and informal care workers in smaller communities.
	Canada	Registered nurses and nurse navigators have an important role in improving co-ordination and continuity of care in the MyHealthTeam model of primary health care.
	Australia, Outback	In the remote Outback, where doctors are scarce, a company called DrumBeat AI uses images of patients’ inner ears to detect diseases and hearing loss in Indigenous children, who have the highest rates of ear disease in the world.
Transport	Norway, Hedmark	In the sparsely populated municipality of Hedmark, the demand-response model uses regular taxis for regular departures from the municipality centre. It is possible to change to railway and express bus services for trips that cross the border of the municipality. The fares are regular and equal to ordinary public transport tickets.
	Germany	LandMobil, launched by Germany’s Federal Ministry of Food and Agriculture, is a funding initiative aimed at improving rural mobility through innovative, flexible, and transferable solutions. From 2020 to 2023, around 40 pilot projects were supported across the country – ranging from e-car and bike sharing to mobile education spaces and youth-driven transport concepts – to enhance accessibility, reduce reliance on private cars, and promote multimodal transport. These projects demonstrated that tailored, community-engaged mobility solutions can effectively close service gaps in rural areas and serve as scalable models for broader implementation.
	Japan, Wakayama Hokkaido & Aichi	Hidakagawa-cho (Wakayama Prefecture) has integrated its bus routes with shared taxis, allowing variation in vehicle size depending on demand at different times, as well as enhanced feeder services and greater frequency. Niseko-cho (Hokkaido Prefecture) has integrated the routes of private buses, municipal welfare buses and school buses. The Migon shared taxi service around the Tohkadai Newtown in Komaki (Aichi Prefecture) is based on flat rate fares, shared rides, limited area of operation and door-to-door service.
	Canada, Alberta	In the province of Southern Alberta, civil society groups, local businesses and local and regional governments collectively invest in electric vehicles’ charging infrastructure to facilitate emission reductions, economic development, and tourism. 22 charging stations powered using renewable energy sourced from the region have been installed.
	United Kingdom, Wales & Scotland	Since 2002, older people enjoy free travel by bus throughout the country. In Scotland, older people enjoy free travel by bus after 9:30 a.m. on weekdays and all day on weekends.
Broadband connectivity & Digitalisation	Chile	The "Enlaces" programme for the training of teachers in information and communication technologies (ICT) and the use of ICT in the classroom has a specific component tailored to support technology-enhanced learning in rural schools.
	France	“Résa’Tao”, the transport on demand service of Orléans metropolis, and “Icilà”, the transport on demand service of Sophia Antipolis regularly cover school transport.
	Japan	Japan has recognised digital infrastructure – particularly fiber optic cables and wireless base stations – as essential for advancing smart agriculture and sustaining rural service delivery. In 2022, the Ministry of Agriculture, Forestry and Fisheries, developed practical guidelines, based on local case studies and inter-ministerial collaboration, to support rural areas in planning and implementing this infrastructure and overcoming challenges linked to remoteness and low population density.
	Korea	The country succeeded in rapidly training teachers who had difficulties with new technologies through a digital platform where teachers could train their colleagues on a voluntary basis.
	Czechia	The Automated Geographical Information System (AGIS) has enabled a transparent and data-driven approach for local governments to monitor, manage, and prioritise infrastructure investment and service delivery.
Housing	France	The country has launched partnerships between small town centres and the surrounding rural areas as part of the ‘Petites villes de demain’ programme. This initiative, which targets small towns with fewer than 20 000 inhabitants, often located close to urban centres, seeks, among other things, to help these small towns renovate their housing stock and improve their infrastructure, to make them more attractive to families or individuals coming from urban centres.

Source: Author’s elaboration

Table 3.7 presents recommendations for OECD policy makers to support service delivery in rural areas. These recommendations aim to ensure cost-effective but equitable access to essential services, develop digital infrastructure, attract and retain skilled professionals, improve rural mobility through innovative transport solutions, adapt housing policies to demographic trends, and strengthen regional co‑ordination.

Table 3.7. Social pillar: policy recommendations

Recommendation	Description
1. Ensuring cost-effective service delivery while guaranteeing equitable access to services for rural communities	Ensure that rural areas have equitable access to essential services by developing integrated planning frameworks that take account of both current and future demographic trends. Governments should prioritise spatial planning tools, including geospatial analysis, and service consolidation, to optimise the location of health facilities, schools, and other services. In rural areas close to cities, this may mean strengthening existing service centres, while in remote areas, priority should be given to the provision of mobile and digital services. Collaboration between different administrations should be encouraged to ensure that resources are pooled efficiently and that rural communities can access services without experiencing excessive travel times.
2. Developing and guaranteeing access to digital infrastructure	Investment in the expansion of broadband is essential to reduce the digital divide between rural and urban areas, enabling access to digital services such as telemedicine, e-learning and teleworking opportunities. In rural areas close to cities, digital services should complement the physical infrastructure, while in remote areas they should be the main access points for essential services. Public-private partnerships should be used to extend fibre and 5G networks to underserved areas. Digital literacy programmes should be promoted to ensure that all rural residents, particularly older populations, can make effective use of digital tools.
3. Attracting and retaining skilled professionals in rural areas	Policy makers should put in place financial and non-financial incentives to attract and retain professionals, including teachers and healthcare workers. Salary top-ups, housing support and career progression opportunities should be offered, particularly in remote areas where recruitment is more difficult. Hybrid working models, enabling professionals to work in both urban and rural areas, could be encouraged. Educational and vocational programmes should incorporate rural experience as a valued career step, offering preferential hiring or promotion after service in rural areas.
4. Improving rural mobility through flexible, innovative, and sustainable transport solutions	It is essential to develop appropriate transport strategies that ensure connectivity between rural communities and urban centres, while improving internal mobility in rural areas. On-demand transport services should be developed in remote areas, complementing existing public transport systems, and aligned with the schedules of essential services and user needs. In rural areas close to cities, investment in multi-modal networks, including cycle lanes, park-and-ride facilities, and rail links, can provide efficient commuting options. Governments should support shared mobility solutions, such as car-sharing and community-led transport initiatives, to reduce reliance on private vehicles. In addition, incentives for electric and low-emission transport options should be put in place to align rural mobility with sustainable development objectives.
5. Adapting rural housing policies to demographic trends	Rural policy should promote flexible and adaptable housing policies that respond to demographic realities and trends. Governments should encourage the renovation and repurposing of vacant buildings in rural areas, including through tax incentives and financial support. In areas experiencing urban spillover growth, policies should ensure that affordable housing options remain available for rural residents. Co‑operative housing models and multi-generational lifestyles should be encouraged to foster social cohesion. Public-private partnerships can also be used to create sustainable, energy-efficient housing developments tailored to the needs of rural areas.
6. Enhancing regional co‑ordination in service and infrastructure planning	Encouraging collaboration between rural and urban areas can strengthen and improve the provision of services and investment in infrastructure. Including rural municipalities in regional planning frameworks can help avoid duplication of services and ensure co‑ordinated investment. Policies should also promote inter-municipal co‑operation in areas such as healthcare, education, and transport services. Mechanisms such as regional councils and inter-municipal agreements should be strengthened to facilitate long-term co‑operation.

Source: Author’s elaboration

3.6. Delivering services in rural near FUAs

Rural areas close to Functional Urban Areas (FUAs) offer unique opportunities in the provision of essential services. Their proximity to urban centres allows these rural communities to operate as regional hubs, providing consolidated services such as healthcare, education, and retail to the surrounding areas. This can significantly improve access for the most remote rural populations, by strengthening regional service networks.

One of the key opportunities lies in the potential of rural-urban partnerships. These collaborations can improve the sharing of resources and provide access to specialised services that would not be available in rural areas alone. For example, rural areas close to FUAs often benefit from better broadband infrastructure, which facilitates digital services such as telemedicine and distance learning. These innovations enhance access to essential services and bring rural residents closer to information and resources.

Transport also plays a key role in service delivery. Shorter distances to cities provide opportunities for innovative mobility solutions, such as on-demand public transport, car-sharing schemes, and community shuttles. These systems improve rural mobility and give residents efficient access to services. In addition, these areas have the potential to explore green housing developments that integrate residential, commercial, and green spaces. Rural-urban partnerships can also improve the housing stock, secure finance, and upgrade essential infrastructure, thereby promoting sustainable growth in rural areas close to FUAs.

However, challenges remain. Over-dependence on urban centres can lead to a decline in local services in rural areas, creating gaps in education or healthcare. Schools can face funding and enrolment problems, reducing specialist education opportunities for pupils in rural areas. Similarly, healthcare facilities in these areas are often under-resourced, leading to longer waiting times and increased reliance on urban health services. Banking and retail services, such as pharmacies, are also limited, forcing residents to travel to urban centres to meet their basic needs.

Despite their proximity to cities, transport networks in rural areas may be inadequate or inaccessible to vulnerable groups, such as the elderly or those without private vehicles. This limits their ability to benefit from urban services, exacerbating social inequalities. In addition, the influx of urban residents into these rural areas often leads to increased demand for housing and higher property prices. These trends can make housing less affordable for long-term rural residents, displacing vulnerable populations and straining social cohesion.

This section examines policy options for rural areas near FUAs, highlighting their potential as regional service hubs and emphasising the importance of partnerships to improve resource sharing. It also explores the role of transport innovations and digital services in improving accessibility and connectivity. In addition, this section offers policy options to address challenges such as housing affordability issues.

3.6.1. Leveraging proximity to cities to deliver key public services in rural areas

In OECD countries, rural areas close to cities can play a vital role in ensuring access to services across rural areas, particularly for people living in remote areas where services are limited. They can serve as regional service centres, concentrating key services such as hospitals, secondary schools, and administrative centres, and supporting both residents, and neighbouring communities.

Defined as the largest settlements within a 30-minute drive, regional centres offer a wider range of services than smaller rural settlements (OECD, 2024[43]). Consolidating services in these centres and ensuring better access can improve service provision in rural areas. For instance, these hubs can meet the needs of smaller surrounding communities and remote areas as well as to reduce the need for rural residents to travel to urban areas for essential services.

In this context, rural-urban partnerships can improve the efficiency of service delivery, particularly in rural areas close to cities. In education, proximity to cities allows rural schools to benefit from partnerships with their urban peers and, therefore, from shared resources and joint programmes that enhance local educational opportunities. In New Zealand, the Kāhui Ako (Learning Communities) initiative brings rural schools together with their urban counterparts to share teaching expertise and resources, particularly in areas such as digital literacy and specialist curricula that can be difficult for rural schools to implement independently (Tātai Aho Rau Core Education, 2017[44]).

In addition, digital learning platforms allow rural students to access online courses and resources that may not be available locally, helping to bridge education gaps (OECD, 2021[45]). In healthcare, for example, partnerships between rural communities and nearby urban healthcare providers can create shared health networks or mobile health units that regularly serve rural areas, offering residents access to high-quality healthcare, including from urban-based specialists (OECD, 2020[46]). Many US states, such as Texas and North Carolina, have set up mobile health units providing preventive services, primary care, dental care and mental health services, linking rural patients with urban healthcare providers. Telehealth initiatives are also being implemented, notably between urban hospitals such as the University of North Carolina and these health units (UNC School of Medicine, 2024[47]).

The effectiveness of this model centre requires good regional transport and digital infrastructure. Policy makers need to ensure that people living in rural areas have easy access to regional centres. The proximity of rural areas to towns and cities provides an opportunity for policy makers to implement flexible and innovative transport solutions that link residents in these areas to services.

On-demand public transport, car-sharing and community shuttle services are increasingly common in these areas, due to the shorter distances to towns and cities and progress in digital technology (OECD, 2021[45]).

Digitalisation offers considerable potential for improving service delivery in rural areas close to cities. These areas often benefit from a better broadband infrastructure than remote rural areas and are therefore more likely to implement digital services for healthcare, education, administration, and other services. The provision of digital services not only saves time for users and generates savings for both users and public administrations, but also improves equity by making services more accessible to rural residents.

3.6.2. The proximity paradox: ensuring that rural areas close to cities do not struggle to provide local services

Although rural areas close to cities can benefit from agglomeration economies, the proximity of these areas to town and cities can present challenges for service provision. Proximity can make rural areas dependent on urban centres for service delivery. People living in rural areas close to cities often travel to nearby towns and cities to access essential services such as healthcare, banking, or retailing. This dependence can therefore reduce the need for local service infrastructure, resulting in fewer facilities such as hospitals, schools, and pharmacies.

As seen in Chapter 2, OECD analysis shows that settlements close to cities often have fewer services than settlements of a similar size further from cities (OECD, 2024[43]). In rural areas close to cities, parents might prefer schools located in towns and cities for their children's schooling. This can lead to funding problems, reduced pupil numbers and limited specialist services – such as guidance, advanced classes, or support for pupils with special needs – in schools located in rural areas close to cities (OECD, 2020[46]).

Chapter 2 showed that health services are also more common in remote rural areas. As with education, the dependence of rural areas on urban healthcare can increase the vulnerability of rural dwellers, especially in emergencies or when transportation and access issues exist. More limited healthcare provision in these areas can lead to longer waiting times and limited preventive care services, which can have an impact on overall health outcomes (OECD, 2021[45]).

In some cases, place-based public policies, including targeted funding and incentives, tend to focus more on remote rural areas than on rural areas close to cities – which may be considered to benefit from urban spillovers. In addition, while rural areas close to cities benefit from proximity, inadequate transport networks or limited public transport options can result in poor access to urban services, particularly for low-income residents and vulnerable populations with reduced mobility, such as the elderly or those without their own means of transport, leading to accessibility challenges.

To meet this challenge, policy makers need to implement balanced policies that support the development of essential services in rural areas close to cities and recognise the role of these areas as service-providing centres in the wider rural ecosystem.

3.6.3. Addressing housing demand and affordability in rural regions close to cities

In rural areas close to cities, the growing demand for housing, particularly in the aftermath of the COVID-19 pandemic, is often driven by individuals and families seeking more affordable or spacious accommodation outside urban centres. For example, in the areas surrounding cities such as Melbourne, Australia, and Toronto, Canada, high real estate values in the cities have led residents to move into neighbouring rural communities, resulting in a spike in property and rental prices in these areas.

This situation makes it difficult for rural residents, particularly those on low incomes, to find affordable housing (OECD, 2020[46]). Despite these affordability problems, rural areas close to cities have the potential to implement innovative housing solutions, including eco-friendly housing estates and mixed-use areas combining residential, public service, commercial and green spaces.

In addition, rural areas close to cities can benefit from their proximity to urban centres through regional housing partnerships. France has launched partnerships between small town centres and the surrounding rural areas as part of the ‘Petites villes de demain’ programme. This initiative, which targets small towns with fewer than 20 000 inhabitants, often located close to urban centres, seeks, among other things, to help these small towns renovate their housing stock and improve their infrastructure, to make them more attractive to families or individuals coming from urban centres (ANCT, 2024[48]). Partnerships or enhanced collaboration between urban and rural areas can also give rural areas easier access to funding, regulatory support, and technical expertise to develop affordable housing for local people and commuters, ensuring that these areas remain accessible to a range of income groups.

3.7. Delivering services in rural remote

Despite the many challenges that remote rural areas face in providing essential services, they also have unique opportunities to benefit from innovative solutions. Digital and mobile technologies, such as telemedicine and distance learning, are improving access to healthcare and education in remote areas. In addition, multimodal and demand-responsive transport systems offer flexible and environmentally friendly mobility options, reducing isolation and improving access to essential services. Strong community involvement is another key opportunity in remote areas. Local communities can play an active role in shaping policy, managing resources, and supporting schools or health facilities. This local approach can make service delivery more responsive to local needs and build stronger resilience across regions. Improving digital connectivity is also crucial to the development of remote areas. Reliable mobile and broadband networks provide opportunities for remote working, attract skilled professionals, and support small businesses. Improved connectivity also stimulates economic growth, diversifying sources of income and creating more sustainable rural communities.

However, remote rural areas face significant challenges. Demographic changes, including a declining and ageing population, are creating financial constraints, as the rising costs of providing services are coupled with falling tax revenues. Closures of schools, hospitals and other facilities increase travel distances and exacerbate accessibility problems, particularly for vulnerable groups such as the elderly and children. These trends exacerbate inequalities and hamper the prosperity of remote rural communities. A persistent challenge for remote areas is attracting and retaining key professionals, such as healthcare workers and teachers. The gaps caused by this shortage undermine the quality of essential services, leaving communities underserved. Housing problems exacerbate these difficulties. Vacant and poor-quality housing reduces the attractiveness of remote areas to potential residents, limiting population retention and further straining municipal budgets. These conditions hinder economic recovery and reduce the functionality of local housing markets.

In response to changing demographic trends, the provision of basic services in remote areas requires a forward-looking and strategic approach. Ensuring quality, sustainability and equity will require innovative solutions tailored to the specific circumstances of these communities. Investment in digital infrastructure, including broadband expansion and support for telemedicine and e-learning platforms, is essential to provide flexible services that bridge accessibility gaps. Financial and non-financial incentives will also play a key role in attracting and retaining professionals. Competitive advantages, housing subsidies and professional development opportunities can alleviate service shortages in critical sectors such as healthcare and education. At the same time, sustainable transport networks and appropriate housing policies, such as the reallocation of vacant buildings, will improve living conditions and accessibility. This section examines the opportunities offered by digital technologies and the strong involvement of local communities in the provision of services in remote rural areas. It also proposes solutions to the challenges of shortages of professionals or gaps in connectivity. Finally, this section explores the potential of innovative transport and housing policies to reduce isolation and revitalise local economies.

3.7.1. Adapting public service delivery to demographic shifts in remote rural areas

Population decline – which is more pronounced in remote rural areas – directly affects the provision of public services by reducing the number of potential users, causing staff shortages, and forcing the closure of facilities, thereby increasing the distance between users and services. This makes it challenging for remote rural areas to balance proximity and cost-efficiency while maintaining quality. Many service facilities operate on a small scale to ensure citizens' accessibility to services, which often entails high per capita costs (OECD, 2021[49]). Demographic changes, including ageing, can put significant pressure on subnational finances and the ability of local governments to maintain quality services. Fewer people of working age and a higher proportion of older people and low-income households lead to a ‘scissors effect’ in which revenues decrease while expenditures remain stable or increase (OECD, Forthcoming[50]).

In addition, remote rural areas face stronger difficulties in attracting and retaining professionals such as doctors, nurses, or teachers. Therefore, the combination of less users, higher per capita costs of service provision, and professional shortages makes it difficult for policy makers to maintain the same level of service provision, which can lead to the closure of some facilities.

Adapting to changes in demand following population decline and ageing implies that certain services will need to become more widely available, while others will have to concentrate more. Restructuring rural services requires a consensual decision by policy makers and local stakeholders on whether to relocate certain services and in which settlements it is most promising to invest (OECD, Forthcoming[50]). In remote rural areas, cost-benefit analysis of investments can use accurate information on the cost implications of delivering services in the present and the future (OECD/EC-JRC, 2021[51]) – based on reliable estimates of costs and access arising from demographic and geographic differences – as well as the financial situation of facilities and accessibility costs for users and workers, including transport costs (OECD, 2022[52]).

In the education field, the decline in the number of children, smaller school sizes, and multi-grade teaching make it difficult to maintain small schools that remain efficient or to provide specialised teaching or targeted support for pupils with special educational needs – leading to policy makers deciding to close and consolidate schools (OECD, 2021[45]). OECD analysis shows that, given the estimated decline in pupil numbers, it is possible to meet demand in 2035 while maintaining similar distances between schools, by reducing the number of primary and secondary schools by 8% and 20% in sparsely populated rural areas, by 5% and 13% in villages, by 3% and 5% in towns and suburbs, and by increasing them by 6% and 8% in cities (OECD/EC-JRC, 2021[51]). As a result, the closure of schools in remote rural areas increases the distance pupils have to travel to reach the new school allocated to them. Similarly, the impact of demographic change on healthcare provision varies geographically. OECD estimations show that while maternity and obstetric services will be further concentrated due to lower demand resulting from low fertility rates, cardiology services will increase and be provided more widely in different territories due to higher demand from ageing populations (OECD/EC-JRC, 2021[51]).

Subnational governments will also need new skills and infrastructures, as well as organisational and cultural changes, in order to implement adaptation policies, especially in remote rural areas (Moreno Monroy, A., 2022[53]). In addition, in co‑operation with national governments, but also by strengthening inter-municipal co‑operation, they will need to pool their resources and capacities and identify opportunities for shared investment in the delivery of public services.

3.7.2. Education: supporting remote schools through digital tools and community involvement

In remote rural areas, declining youth population is stronger. In this context, schools in remote rural areas are facing a decrease in the number of pupils, leading to a reduction in school size, class size and student-teacher ratios, or even the risk of closure (OECD, 2021[45]). While some of these consequences may offer opportunities, such as more personalised instruction and teaching time per student, many schools face the risk of isolation and undercapacity. In addition, fewer and smaller schools also imply longer access and travel times – estimations show that students in sparse rural areas travel on average four to five times further compared to students in cities (OECD/EC-JRC, 2021[51]) – as well as a more limited curriculum, with fewer subjects to choose in secondary school and fewer specialised teachers.

These educational challenges pose a risk to the academic and career prospects of rural students. Analysis using PISA results showed that in some OECD countries the reading scores among students in city schools were above 40 percentage points than their peers in schools located elsewhere – more than the equivalent of a year of schooling (OECD, 2021[45]). Principals and teachers often have to assume multiple roles, which can affect the smooth and effective functioning of schools. Principals, for example, face the need to handle direct teaching responsibilities, and teachers frequently must teach at different levels of education. In addition, the COVID-19 pandemic crisis and the adoption of distance learning highlighted the inequalities faced by rural education communities in accessing digital services.

Policies adapting to demographic change and new technologies are bringing several opportunities for schools in remote rural areas. Digital educational tools can provide more didactic and personalised learning experiences, including through multimedia content and game-based learning, as well as measure understanding and performance, provide immediate feedback and improve pupil motivation. Digitalisation can also make online courses and interactive learning platforms accessible from rural regions, thus expanding the educational offer to students. In Quebec, Canada, the project Networked Schools (L’École en réseau) allows students and teachers in small and remote schools to learn and collaborate via ICT tools such as videoconferencing, enabling the formation of learning communities and augmenting pedagogical approaches.

It is also essential to encourage schools in remote areas to participate actively in the restructuring of the school network, and to guarantee an adequate quality of teaching when multi-grade classes are introduced in order to increase the scale of rural schools. Remote rural areas also face the need to retain and attract teachers through financial or non-financial incentives, such as faster career progression or support measures to help them settle in a particular location. Exchange programmes between teachers in urban and rural areas can also be set up. The McCormick Rural Teacher Residency program – a partnership between rural McCormick County in South Carolina, United States, and the Center for Educator Recruitment, Retention, and Advancement (CERRA) – offers a stipend, loan forgiveness, and even low-rent housing for student teachers who teach in rural communities. In addition, remote rural schools, despite having fewer resources, both material and in terms of staff, often benefit from greater community involvement, such as parents' participation in extracurricular activities, volunteering (e.g. canteen staff, cleaners), and fundraising (OECD, 2021[45]). In Colombia, the "Learning Communities" initiative, implemented since 2014 in municipalities of Valle del Cauca and other Colombian rural departments, allows better integration of local communities – via committees made up of teachers, parents, and students – in educational decision-making (on school life, academic matters, including curriculum design and evaluation, cultural activities, school infrastructure and pedagogical tools). To enable remote schools to benefit from the advantages of their close-knit communities, policies need to ensure greater flexibility, for example in health and safety regulations.

3.7.3. Healthcare: overcoming obstacles in remote areas with innovative solutions

Demographic change results in higher shares of elderly population in rural areas on average, with shorter life spans and worse health outcomes, including higher incidence of chronic disease, hence requiring more complex healthcare needs (OECD, 2021[45]). Higher old-age dependency rates also exert further pressure on healthcare public services that are often more costly in rural areas. As in the education field (see above), remote rural areas face longer travel times to accessing healthcare facilities. At least 40% of people living in sparsely populated areas in Europe lives far from a medium-sized health service location (OECD/EC-JRC, 2021[51]). Moreover, remote rural areas also face higher challenges in recruiting and retaining professionals due to a combination of lower wages, concerns about prestige and professional prospects, as well as the often urban-centric medical education. Cost reduction policies in the aftermath of the 2008 financial crisis affected severely rural health provision. While hospital bed rates slightly increased in metropolitan regions since 2008, they decreased in all types of rural regions at an average rate of -0.7% per year (OECD, 2021[45]). This easily leads to rural hospitals being overwhelmed.

New technologies and digital tools are bringing several opportunities for healthcare provision in shrinking and ageing remote rural areas. In most of OECD countries, telemedicine platforms can enable people living in remote areas to receive medical consultations without having to travel long distances. Although these consultations can often be done from home, some of the telemedicine appointments in specialised medical fields are held at local primary care centres, as specialised clinics and services are often scarce in remote rural areas. This can help to alleviate disparities in the geographical distribution of health personnel, in particular specialists who can thus continue to provide medical care to rural patients. Moreover, the integration of new technologies, including Artificial Intelligence, into the healthcare sector is also offering unprecedented opportunities for rural dwellers and healthcare workers (Bournisien de Valmont, 2024[54]). In the remote locations in Australia, where access to health professionals is scarce, innovative approached are being trialled to provide ear and hearing health care. This includes DrumBeat AI, a company which is piloting the use of images of patients’ inner ears to help detecting diseases and hearing loss in First Nations children – who have some of the highest rates of middle ear disease in the world.

In addition, policy makers can make use of innovative solutions for health service delivery, including flexible solutions such as mobile clinics, shifting responsibilities between health professionals, or expanding the role of patients in primary care. In Canada, for example, registered nurses and nurse navigators have an important role in improving co-ordination and continuity of care in the MyHealthTeam model of primary health care (OECD, 2020[55]). The University of Kansas has conducted activities that demonstrated how patient-centred health care – giving voice to rural residents – can have a significant impact. Harnessing the power of networks to expand and co-ordinate rural care has also encouraged appropriate models of organising clinical networks for rural care, such as the hub-and-spoke model – the combination of a central “hub” hospital with a wide range of services and skills and small “spoke” hospitals with more limited services that provide basic care when necessary (OECD, 2021[45]). Australia has adopted this model for emergency care, with patients stabilised in smaller hospitals and transferred for more intensive care to larger central hospitals. In the Basque Country, Spain, public authorities have implemented a number of integrated care principles for care co-ordination and structural integration, including merging hospitals and primary care structures into integrated healthcare organisations.

3.7.4. Accessibility to services and mobility: enhancing transport solutions for remote rural areas

Mobility and transport infrastructures play a crucial role in facilitating access to work, services, leisure or even information. However, remote rural regions lack the critical mass needed to deploy cost-effective public transport networks and dependence on private cars is very high. Concentrating service provision in larger facilities in more densely populated places may raise efficiency but it also implies longer journeys for users to access all types of services (see above). Students in EU remote rural areas have to travel on average 5 additional kilometres to reach a school compared to students in other areas (EC et al., 2022[56]). In addition, the insufficient supply of public transport in shrinking places increases car dependency and makes transport a primary source of greenhouse gas (GHG) emissions in rural regions (OECD, 2021[49]) (OECD, 2023[57]). The latter are also more vulnerable to increases in fuel taxes to discourage car use, which can lead to greater social discontent and lower levels of trust in government.

In this context, it is vital to provide transport services in remote areas to enable people to access basic services such as schools and primary care, and to not leave behind vulnerable populations, particularly those with greater difficulties in accessing and using digital services or making longer journeys on their own. Moreover, fixed routes and timetables do not meet the mobility needs of people in rural regions. To meet these transport needs, spatial and land-use plans are incorporating demand-oriented public mobility through demand-responsive transport (DRT) services – door-to-door or predefined pick-up and drop-off points – in which services are provided only if there is demand and taking into account the specific needs of different social groups such as old-age people, young people or children. In the Netherlands, the SD Verbindt project on Schouwen-Duiveland is testing electric mobility solutions to reduce isolation among older adults while supporting climate goals and local employment. In addition, geospatial analysis can improve accessibility to key services while ensuring sustainability. It can help policy makers decide where to locate service infrastructures (e.g. hospitals, schools) and where to provide transport infrastructures to reach these services. In remote rural areas, policy makers can also rely on private transport companies to organise transport routes, including school transport. In Japan, for example, Niseko-cho (Hokkaido Prefecture) has integrated the routes of private buses, municipal welfare buses and school buses.

Multimodal and sustainable transport solutions offer remote regions better connectivity, while targeted policies improve accessibility and encourage the use of public transport for ageing populations. Multimodal transport infrastructure integrating different modes of transport and facilitating the switch between transport modes (e.g. unique ticketing systems, public transport vehicles with space for bikes or scooters) can be an opportunity for remote regions. In the sparsely populated municipality of Hedmark, in Norway, the DRT model uses regular taxis for regular departures from the municipality centre. It is possible to change to railway and express bus services for trips that cross the border of the municipality. The fares are regular and equal to ordinary public transport tickets. Policy makers in remote areas should also enhance sustainable transportation and focus on net zero engines and technological innovations in transportation that reduce emissions (e.g. deployment of electric vehicles and investment in charging infrastructure). In shrinking and ageing contexts, policies can also address accessibility challenges of old-age population in public transport (e.g. reduced mobility and safety concerns, lack of adequate seating, or insufficient signals) as well as provide incentives to increase their use (e.g. free at certain times). In Wales, since 2002, older people enjoy free travel by bus throughout the country. In Scotland, they enjoy free travel by bus after 9:30 a.m. on weekdays and all day on weekends.

3.7.5. Broadband connectivity: improving quality, access, and digital skills

Broadband connectivity is an essential infrastructure for stimulating economic and social development in rural areas, for providing opportunities for businesses, and for facilitating cost-efficient solutions in areas facing remoteness (e.g. teleworking, e-learning, e-health, e-governance). However, extending existing infrastructure networks to connect service facilities is more difficult in rural areas with a sparsely distributed population and, in some cases, difficult topographical conditions (OECD, 2021[49]). Newer technologies and upgrades for broadband provision (e.g. fibre optical cabling and 5G mobile technology) are less common in rural areas, where previous generation and slower technologies (e.g. digital subscriber lines) remain dominant (OECD, 2021[45]). Persistent rural-urban divide in digital infrastructure as seen in Chapter 2 makes it difficult for rural areas to fully benefit from the advantages of digitalisation, from knowledge and skills acquisition, access to e-services, remote working, or social interactions. At the same time, reduced access to high-speed internet in rural areas can undermine opportunities for innovation and business development and limit the attractiveness for skilled workers and entrepreneurs to move to rural areas.

To harness the benefits of digitalisation, rural policy must include innovative solutions and investments that leverage accessibility to communication infrastructures and facilitate the uptake of digital technologies, in particular in remote regions. These include regulatory changes that enhance the efficiency of the market, subsidy programmes for network development, bottom-up approaches, small-scale efforts at the local level, or public-private partnerships. In the United States, the Broadband Technology Opportunities Programme (BTOP) provided USD 10.8 million to the Dakota Carrier Network (DCN) for its fibre-building efforts in rural areas. The project constructed 272 km of new fibre, with backhaul speeds as fast as 1 Gbps to enable last-mile service.

Telemedicine also reduces travelling costs for both users and governments. Patients in the Ontario Telemedicine Network in Canada avoided travelling 270 million km in 2017 and the network saved more than CAD 70 million in travel grants (OECD, 2022[52]). In addition, it is essential to encourage collaboration between public authorities and operators to enhance effective and innovative policies ensuring cost-efficient, accessible, and quality service delivery.

Rural policy must enhance public-private partnerships and benefit from big data and mobile data – to better understand the demand for services, analyse user’s behaviour and mobility patterns, and plan services to match user needs, for instance, through DRT services (see above). This increased collaboration can also include the monitoring of the rollout of broadband by operators or decisions on the choice of the location of high-voltage lines and masts. In the United States, a consortium of small, independent rural companies and co-operatives came together in 1996 to purchase the 68 rural exchanges of the incumbent telephone company, US West (now named Century Link), and formed the Dakota Carrier Network (DCN), a state-wide umbrella organisation that covers 90% of the state’s land area and 85% of its population. Federal support for their fibre-building efforts came from the Broadband Technology Opportunities Programme (BTOP), which provided USD 10.8 million for a project to construct 272 km of new fibre in the state, with backhaul speeds as fast as 1 Gbps to enable last-mile service (OECD, 2021[58]).

Policymaking in remote areas also needs to invest in building the digital skills of public professionals and citizens to ensure the continued delivery of essential services. Korea, for example, succeeded in rapidly training teachers who had difficulties with new technologies through a digital platform where teachers could train their colleagues on a voluntary basis.

3.7.6. Housing: boosting revitalisation and adaptive re-use in remote rural areas

Significant population decline in remote areas can reduce housing stock, leave vacant buildings, and increase housing maintenance costs, making it difficult for housing markets to function. The presence of abandoned or inadequately maintained housing diminishes the overall quality of built environments. All these challenges fall into a vicious circle in which oversupply and poor-quality living environments lead to falling house prices and thus to lower municipal tax revenues and to the exclusion of shrinking regions from real estate and renovation investments (OECD, Forthcoming[50]).

Housing policies and land use and spatial planning need to integrate demographic considerations, including population projections, and spatial development trajectories. Policy responses need to identify buildings for demolition and central areas for renovation, use land readjustment, and involve affected residents and landowners in decision-making. The promotion of participatory mechanisms that provide opportunities for dialogue between affected populations and local governments is paramount to building public support. Central governments can also support local authorities in remote rural areas by providing data and estimates on housing vacancies as well as by improving administrative capacity to manage demolition and renovation projects.

In remote rural areas, public policies can seize opportunities for adaptive re-use and rural revitalisation. In Portugal, the government has launched a rural regeneration programme that encourages individuals to renovate vacant homes in depopulated areas, offering grants and subsidies to young families and entrepreneurs wishing to relocate. A similar approach in Scotland offers financial incentives to convert abandoned properties into affordable housing while preserving historic architecture. In addition, isolated rural areas can benefit from the rise of teleworking – subject to the availability of quality broadband connectivity (see above) – by promoting affordable housing and quality rural lifestyles. This is the case, for example, in Ireland, which has launched initiatives that showcase rural areas as ideal destinations for remote working, with affordable housing, community support and a stunning natural environment.

3.8. Environmental policies for the future of rural areas

The environmental challenges facing rural areas require targeted policy responses that reflect the specific conditions of different territories (OECD, 2020[46]). Rural areas close to cities often experience pressures linked to urban expansion, pollution spillovers, increased land-use competition and limited financial access (see Box 3.20). At the same time, their proximity to urban markets and infrastructure creates opportunities for circular economy initiatives, renewable energy integration, and resource-sharing mechanisms with urban centres. In contrast, remote rural areas face distinct challenges, including limited connectivity, higher infrastructure costs, and difficulties in accessing investment for environmental improvements. However, they also possess significant natural resources that can support renewable energy projects, conservation efforts, and sustainable land management practices (OECD, 2020[59]).

Policy solutions must be tailored to these distinct contexts. For rural areas close to cities, strategies should focus on optimising land use, fostering rural-urban energy collaboration, and integrating circular economy principles into regional development plans (OECD, 2021[60]). For remote rural areas, priorities include enhancing access to renewable energy, strengthening land conservation frameworks, and improving climate resilience through adaptive land-use policies. A cross-cutting approach is necessary to ensure that all rural areas benefit from technological innovation, financial incentives, and governance mechanisms that enable effective environmental management. Environmental policies must also be integrated into broader economic and social frameworks to ensure sustainable rural development. Competitiveness in rural regions depends on access to affordable and sustainable energy, regulatory frameworks that support environmental innovation, and investment in infrastructure that enhances resilience. At the same time, demographic shifts, including ageing populations and outmigration, create additional pressures that require policies with a cross-cutting approach.

Box 3.17. Addressing the rural finance gap for the green transition

Access to finance remains a structural barrier to renewable energy development in rural areas, particularly in remote regions

Despite the availability of land and natural resources, rural actors often struggle to access the capital required to develop renewable energy projects. Barriers include the small scale of projects, high transaction costs, limited technical capacity to prepare bankable proposals, and higher perceived investment risks due to low population density and weaker infrastructure (OECD, 2012[61]), (OECD, 2015[62]). These constraints hinder both private sector involvement and community-led initiatives, reducing the capacity of rural territories to leverage their assets for the green transition.

Targeted policy action is needed to improve financing conditions for rural renewable energy. This includes the development of de-risking mechanisms such as guarantees and insurance schemes, simplified permitting procedures for small-scale projects, and technical assistance for project design and financial structuring. Supporting aggregation mechanisms—such as co‑operatives or energy communities—can also help rural stakeholders reach sufficient scale to attract investment. These models have proven effective in some OECD countries in mobilising local capital, reducing costs through collective procurement, and strengthening local ownership (CEFIM, 2024[63]).

Strengthening the enabling environment is key to unlocking the renewable energy potential of rural regions. Policy efforts should focus on creating clear and stable regulatory frameworks, providing capacity-building programmes for local authorities and communities, and ensuring that rural actors can access national or EU-level financing instruments. Moreover, ensuring that the benefits of renewable energy projects—such as income from electricity generation or local reinvestment of revenues—remain in rural areas is important to increase public acceptance and long-term viability. Without adequate support, there is a risk that rural areas will remain underutilised in national decarbonisation efforts, despite their resource endowment and strategic relevance (OECD, 2015[62]), (CEFIM, 2024[63]).

Sustainable environmental management in rural areas necessitates integrated strategies tailored to diverse territorial contexts. Regions adjacent to FUAs grapple with challenges stemming from urban expansion and land-use competition, while remote rural areas confront issues related to resource accessibility, ecological conservation, and infrastructural deficiencies. Despite these distinct challenges, implementing cross-cutting strategies can bolster environmental resilience, enhance governance, and promote long-term sustainability. Addressing these issues requires a dual approach that differentiates solutions based on local conditions while ensuring policy coherence across rural territories.

A pivotal aspect of this approach is land-use planning, which significantly influences economic development, conservation efforts, and climate resilience. In regions near FUAs, land-use policies must balance the increasing demand for residential, commercial, and industrial development with the preservation of agricultural land, green spaces, and biodiversity corridors. Without effective land management, these areas risk experiencing uncontrolled urban sprawl, fragmentation of natural habitats, and diminished agricultural viability. Conversely, in remote areas, land-use challenges involve ensuring that large-scale activities—such as renewable energy projects, extractive industries, and extensive agricultural practices—do not lead to environmental degradation or unsustainable resource depletion. Strengthening spatial planning frameworks, integrating nature-based solutions, and adopting participatory land governance models are critical in both settings.

Empowering rural communities to actively participate in environmental management is another key pillar of cross-cutting policy. Local engagement in decision-making processes can enhance the effectiveness of conservation efforts, increase the adoption of climate adaptation measures, and promote community-led sustainability initiatives. However, the mechanisms for achieving this differ by region. In areas near FUAs, participatory planning can help integrate rural perspectives into broader regional environmental strategies, ensuring that rural interests are not overshadowed by urban priorities. In remote areas, decentralized governance structures and targeted capacity-building programs can enable communities to manage local environmental assets more effectively. Providing rural actors with financial resources, technical expertise, and digital tools for environmental monitoring is essential to support their role as stewards of natural landscapes.

Climate adaptation is another fundamental aspect that requires investment in infrastructure, risk mitigation strategies, and ecosystem-based approaches. Both close-to-FUA and remote regions face increasing risks from extreme weather events, soil degradation, and shifting agricultural conditions. In peri-urban areas, policies should prioritize the development of green infrastructure, flood mitigation systems, and low-carbon transport networks to reduce environmental pressures. Conversely, remote regions require strategies that enhance the resilience of rural livelihoods, such as climate-smart agricultural practices, improved water resource management, and financial instruments for disaster recovery. Strengthening climate adaptation policies will be crucial for ensuring that rural areas remain viable and resilient in the face of environmental change.

3.8.1. Indigenous peoples as climate vulnerable group and active source of climate solutions

Indigenous people across the world are disproportionately impacted by climate change for three key reasons: i) geographic vulnerability, ii) dependence on traditional lands and livelihoods, and iii) colonial legacies and socio-economic marginalisation.

Many Indigenous peoples living in rural areas are located in regions highly susceptible to climate change, such as remote arid lands, forests, and coastal areas (Standen et al., 2022[64]). Those living on traditional lands may therefore disproportionately experience devastating impacts of rising temperatures, extreme weather events, and rising sea levels. As ecosystems shift many Indigenous peoples are forced to adapt their ways of life, facing relocation, food insecurity and loss of livelihoods (Lam et al., 2019[65]).

Indigenous peoples in rural areas often have strong connections to traditional lands and livelihoods including activities such as fishing, farming, and cultural activities (Nuttall, 2007[66]). Impacts of climate change directly impacts these activities, threatening economic survival and eroding cultural identity and intergenerational knowledge transfer (Pearson, Jackson and McNamara, 2021[67]). For instance, for Indigenous Sami reindeer herders across Finland, Norway, Russia, and Sweden the more frequent and intense rain-on-snow events and freeze-thaw cycles caused by climate change make it difficult for reindeers to access food and impact these activities.

The historical and ongoing impacts of colonialism has created systemic inequalities, land dispossession, and marginalisation for many Indigenous peoples (Reid, Cormack and Paine, 2019[68]). This has resulted in higher poverty rates, weak political representation, and worse socio-economic outcomes than non-Indigenous peoples (Hajizadeh et al., 2018[69]). In the context of climate change, this impacts Indigenous peoples’ ability to adapt to climate change and secure government support or funding for climate resilience. This can be exacerbated in rural areas where extreme weather events can disproportionately impact marginalised Indigenous peoples. For instance, across remote Indigenous housing in Australia, overcrowding exists in 32% of dwellings in remote areas, and 55% of dwellings in very remote areas, creating economic, social, and health problems especially with the onset of extreme heat or flooding caused by climate change (AIHW, 2023[70]).

Traditional knowledge for protecting ecosystems and advancement of the circular economy

Despite representing less than 5 per cent of the world’s population, Indigenous peoples steward over 25 per cent of land and seas across the globe and protect over 80 per cent of global biodiversity (Conservation International, 2023[71]). Programmes and policies that enable Indigenous peoples to engage in environmental conservation on their land can therefore have significant practical benefits for addressing climate change. For instance, Indigenous land rights in Colombia over lands and forests has enabled GHG emissions to be 10-15% lower than had Indigenous stewardship not existed (Arango, 2017[72]). Initiatives such as Indigenous-led environmental ranger groups, mostly located in rural and remote areas have been successful in not only improving environmental indicators such as water quality and biodiversity, but also provides culturally appropriate employment opportunities for Indigenous peoples (First Nations Clean Energy Network, 2024[73]).

Circular economy strategies can help reduce emissions, accelerate clean energy, and enhance adaption. It is estimated that circular economy approaches could supply approximately 20% of total critical mineral demand (OECD, 2024[74]). The activities of the circular economy such as repurposing, reusing, and recycling reflect Indigenous approaches to environmental management that have existed for millennia. Indigenous engagement with the environment takes a whole of system approach that considers the interconnected impact of human activity, passing down knowledge of local ecosystems from one generation to another (Kumari et al., 2022[75]). This includes the sustainable use of environmental resources that allows for natural regeneration, only taking what is needed and ensuring materials are repurposed or returned to the earth (Beamer et al., 2023[76]). Involving Indigenous peoples in circular economy strategies can therefore provide more successful transitions to circular systems.

Table 3.8.  Environmental pillar: examples of good practices across OECD countries

Dimension	Country, Region	Description
Resource Management & Conservation	Japan, Yamanashi Prefecture	Fruit tree farmers in Yamanashi produce biochar from pruned orchard branches and apply it to the soil, contributing to long-term carbon storage and soil health. Combined with compost use and no-till practices, this method supports biodiversity, reduces greenhouse gas emissions, and enhances the environmental resilience of rural farming systems (MAFF, 2024[77])
	Australia, Murray-Darling Basin	The Murray-Darling Basin Plan ensures a balanced allocation of water between agricultural, environmental, and urban needs, preventing overuse and supporting long-term sustainability. By implementing an evidence based water trading system and adaptive management strategies, the initiative provides resilience against droughts while maintaining agricultural productivity. The plan is an example of how government can regulate natural resources in rural regions to support both economic and ecological goals (Australian Government, 2024[78]).
	Finland, Lapland	In the Áldujohka Sámi Indigenous Community Conserved Area (ICCA), located in northern Lapland, Indigenous-led conservation integrates traditional Sámi reindeer herding with biodiversity restoration and monitoring. The site, co-managed by Sámi herders and the Snowchange Cooperative, supports cultural continuity while protecting endangered habitats and species, such as old-growth boreal forests and native trout streams. Although it covers only 70 hectares, Áldujohka demonstrates how community-based conservation can align traditional land use with ecological goals, despite the lack of formal land rights recognition (ICCA, 2025[79]).
	Canada, British Columbia	The Great Bear Rainforest agreement protects one of the world’s largest temperate rainforests through a collaborative governance model that involves Indigenous communities, environmental groups, and the forestry industry. The initiative allows for limited, sustainable logging while ensuring that ecological integrity is maintained. This model highlights how rural regions can balance economic activities with large-scale conservation efforts (British Columbia Gov, 2024[80]).
	United States, Montana	A land restoration programme in the Northern Great Plains is rewilding degraded prairie landscapes, restoring native plant species, and reintroducing bison herds. These efforts help combat soil erosion, enhance carbon sequestration, and promote ecotourism as a sustainable economic alternative to traditional resource extraction industries. The initiative illustrates how rural areas can transition towards nature-based economies while restoring degraded ecosystems (NFWF, 2021[81]).
Climate Adaptation & Renewable Energy	Japan, Okinawa Prefecture	In line with Japan’s Strategy for Sustainable Food Systems, a private company in Okinawa has installed a biogas plant that converts dairy cow excrement into clean electricity, liquid biomass fertiliser, and solid compost. The liquid fertiliser is distributed to nearby sugar cane and vegetable farms, supporting organic agriculture and improving nutrient cycling. This initiative contributes to decarbonisation and sustainable waste management in rural areas (MAFF, 2024[77])
	Germany, National Level	Germany's federal policy framework supports rural areas in advancing environmental objectives through improved access to funding, decentralised planning capacity, and the evaluation of federal programmes for their spatial impacts. The Fourth Federal Report on Rural Development and the Equivalence Report highlight a reduction in regional ecological disparities and promote legislation that accounts for the needs of structurally weaker rural areas. Instruments such as the GAK and GRW remain key tools, while reforms aim to reduce bureaucratic barriers and reinforce local capacity to manage the energy transition and environmental services (Federal Government of Germany, 2024[82])
	New Zealand, National (excluding metropolitan areas)	The Provincial Growth Fund (NZD 3 billion) was launched in 2018 to improve long-term economic, social and environmental outcomes in rural and regional New Zealand. It supported infrastructure, sectoral investment and capability-building, including projects contributing to climate resilience, biodiversity restoration and more sustainable use of land and water. By mid-2024, PGF had contributed to over 48,000 jobs, NZD 11.2 billion in additional expenditure, and NZD 4.8 billion in GDP. In regions like Northland and Gisborne, environmental benefits included reforestation, waterway restoration and increased resilience to natural disasters (Kānoa, 2023[83])
	Scotland, Orkney Islands	The Orkney Islands consistently produces more electricity from renewables than it consumes. To manage this surplus, Orkney has developed hydrogen production projects that convert excess renewable energy into hydrogen for storage and local use. These initiatives demonstrate how remote rural areas can contribute to the energy transition, generate skilled jobs in clean technologies, and explore new roles as net energy producers (Orkney, 2025[84]).
	Netherlands, Zeeland	The "Room for the River" programme is a large-scale initiative designed to reduce flood risks in rural and urban areas by restoring natural floodplains and wetlands. In addition to improving climate resilience, the project enhances biodiversity and creates recreational opportunities, showcasing how integrated environmental management can address multiple sustainability challenges at once (GEJ, 2024[85]).
	South Korea, Gangwon Province	Gangwon Province has implemented an advanced IoT-based forest monitoring system to prevent wildfires and illegal logging. By combining satellite data with artificial intelligence, this initiative improves real-time environmental monitoring and rapid-response capabilities. It highlights the role of digital innovation in enhancing environmental protection in rural regions (Lee et al., 2020[86]).
	Germany, Bavaria	Community-owned renewable energy co‑operatives have enabled small municipalities in Bavaria to finance and operate wind and solar farms, also called "Bürgerenergiegenossenschaften". These co‑operatives reinvest profits into local infrastructure, such as public transportation and energy-efficient housing. By ensuring that economic benefits remain within rural communities, this model supports local development while advancing the energy transition (WIP Renewable Energies, 2014[87]).
Circular Economy & Waste Management	Belgium, Flanders	Flanders, under the Flanders Circular programme, aims to reduce its material footprint by 30% by 2030. The Flanders Materials Programme has helped connect businesses to exchange residual flows and by-products, fostering new business models based on resource efficiency. These initiatives contribute to reducing raw material demand and landfill use, while supporting economic innovation through circular value chains (Circular Flanders, 2024[88]).
	Sweden, Västerbotten	Västerbotten’s bioeconomy strategy focuses on converting forest biomass into high-value products such as biofuels, bioplastics, and sustainable chemicals. By integrating rural forestry industries into circular supply chains, the initiative reduces dependence on fossil fuels while generating employment in knowledge-intensive sectors (Jolly and Hansen, 2025[89]).
	Japan, Kamikatsu Town	Kamikatsu has become a global pioneer in rural zero-waste policies, requiring residents to separate waste into 45 different categories. This has resulted in an 80% recycling rate and significantly reduced landfill use. The initiative showcases how rural municipalities can achieve high environmental standards through strong local engagement and waste reduction policies (Zero Waste Center Kamikatsu, 2022[90]).
	France, Paris Region	A regional circular economy strategy connects businesses, public authorities, and citizens to scale up sustainable production and consumption practices. The initiative supports industrial symbiosis, green public procurement, and rural-urban collaboration on waste reduction, demonstrating how policy frameworks can drive systemic change (Choose Paris Region, 2024[91]) .
Community-Led Environmental Governance	New Zealand, South Island	Maori-led ecotourism projects in New Zealand integrate conservation with cultural heritage, creating sustainable employment while preserving traditional land management practices. These initiatives enhance biodiversity protection while strengthening the economic resilience of Indigenous rural communities (Fountain and Lück, 2024[92]).
	United States, Texas	Texas has implemented a community resilience programme that provides rural municipalities with technical assistance to develop climate adaptation plans. By supporting locally led solutions for flood risk management and extreme weather preparedness, the programme ensures that rural communities can effectively respond to climate-related challenges (GeorgeTownClimate, 2017[93]).
	Norway, Hedmark	In response to declining public transport services, rural communities in Hedmark have developed demand-responsive transport solutions tailored to low-population areas. This system ensures that vulnerable groups, such as elderly residents, have access to essential services while minimising transport emissions. It highlights how localised solutions can improve mobility in remote rural regions (Interreg-baltic, 2019[94]).

Table 3.9. Environmental pillar: policy recommendations

Recommendation	Description
Promote climate resilience	Investing in nature-based solutions and resilient infrastructure can help rural areas adapt to climate change. Policies should support reforestation, agroforestry, and wetland restoration projects that enhance biodiversity while mitigating extreme weather impacts. Rural areas close to cities should integrate green infrastructure into urban planning, while remote regions should prioritise ecosystem-based adaptation strategies to strengthen local resilience.
Support sustainable land management	Land-use policies must balance economic and environmental priorities. Policies should promote regenerative agriculture, soil conservation practices, and carbon sequestration incentives, such as payments for ecosystem services. In peri-urban areas, urban expansion must be managed to protect farmland and biodiversity corridors, while in remote areas, large-scale land use should align with conservation goals.
Enhance acess to green technologies	Supporting rural enterprises and farmers in adopting green technologies is essential for environmental sustainability. Governments should develop funding mechanisms, tax incentives, and training programs to facilitate the deployment of renewable energy systems, precision agriculture, and circular economy solutions. Off-grid and microgrid solutions should be prioritised in remote areas to improve energy resilience and reduce reliance on fossil fuels.
Inclusive engagement in renewable energy	Local participation in renewable energy initiatives can improve social acceptance and ensure long-term sustainability. Governments should promote community-led energy projects, such as co‑operatives and benefit-sharing models, that allow rural populations to take ownership of local energy assets. Regulatory frameworks should support decentralised energy production and ensure equitable distribution of economic benefits.
Develop circular economy strategies	Circular economy approaches can reduce waste and create new economic opportunities for rural areas. Policies should support industrial symbiosis, organic waste-to-energy initiatives, and sustainable material use. Rural regions close to cities should strengthen rural-urban linkages for waste valorisation, while remote areas can develop bio-based industries that utilise local biomass resources efficiently.
Strengthen biodiversity and ecosystem services	Rural areas provide essential ecosystem services such as carbon sequestration, water filtration, and habitat conservation. Policies should integrate biodiversity considerations into rural development plans, establish conservation easements, and create financial incentives for landowners to protect natural landscapes. Agroecological practices should be promoted to maintain soil health and pollinator populations.
Improve water resource management	Water scarcity and quality issues are major concerns in many rural areas. Policies should prioritise investments in efficient irrigation systems, watershed protection, and sustainable groundwater management. Rural areas close to urban centres should integrate water resource planning with metropolitan strategies, while remote regions should adopt decentralised water governance models that involve local communities in decision-making.
Foster sustainable mobility and low-carbon transport	Rural mobility strategies should address transportation emissions while ensuring accessibility. Governments should invest in public transport links between rural and urban areas, support car-sharing and on-demand transport services, and promote the use of electric and low-emission vehicles. Remote areas should explore alternative fuel options and digital connectivity solutions to reduce travel needs.
Ensure just transition for resource-dependent communities	Regions reliant on extractive industries must navigate economic transitions while safeguarding livelihoods. Policies should support workforce retraining, economic diversification, and community-driven development strategies. Funding mechanisms should prioritise the development of sustainable industries, such as renewable energy and eco-tourism, to provide stable employment in rural regions.
Enhance multi-Level governance for environmental management	Effective environmental policy requires co‑ordination across local, regional, and national governments. Strengthening governance mechanisms can improve policy coherence and resource allocation. Rural areas close to cities should integrate environmental policies with metropolitan planning frameworks, while remote areas should be supported with targeted governance capacity-building initiatives.

Source: Author’s elaboration

3.9. Policies for the environmental agenda: rural areas close to a FUA

Rural areas close to a FUA face unique environmental challenges and opportunities due to their geographic position at the interface of urban and rural systems. These regions experience significant land-use pressures as expanding urban centres drive demand for residential, commercial, and industrial development. The competition for land can strain agricultural production, biodiversity conservation, and ecosystem services, requiring careful planning to balance economic growth with environmental sustainability. Additionally, pollution spillovers from nearby urban areas, including air and water pollution, waste accumulation, and noise, can impact local ecosystems and quality of life.

However, proximity to urban centres also presents opportunities for rural areas to play a critical role in advancing sustainable environmental policies. These regions can facilitate circular economy initiatives by integrating resource recovery, waste management, and sustainable supply chains into urban systems. Additionally, their strategic location allows for renewable energy production that can serve both rural and urban markets, contributing to the decarbonisation of regional economies. Effective environmental policies for these areas must leverage rural-urban synergies, ensuring that economic development and sustainability goals are aligned.

Box 3.18. Rural Agenda for Climate Action (RACA)

Rural areas are crucial in advancing the global transition to net zero, home to 30% of the OECD population and covering 80% of its land (OECD, 2021[60]). Rural policies are influential in key activities for net zero, such as land use, renewable energy deployment, and circular economy strategies. The OECD Rural Agenda for Climate Action (RACA) focuses on these, highlighting sustainable mobility in rural areas. Challenges include high GHG emissions from transport while ensuring access to services and markets across large areas.

The RACA emphasises the need for rural policies to accelerate progress towards net zero emissions, envisioning a thriving rural landscape that seizes opportunities from the green transition. It recognises the unique strengths and challenges of each rural region, aiming to align rural policies with global climate objectives by showcasing achievements and identifying growth opportunities.

Endorsed by OECD countries in November 2021, the RACA calls for rural policies to actively contribute to net zero targets. It adopts a holistic approach to ensure rural regions benefit from opportunities linked to environmentally friendly economies. RACA highlights six policy areas as key levers for achieving rural development and net zero goals and promotes dialogue on integrating rural opportunities into broader climate strategies.

The six policy areas of the RACA are:

• Indicators and Information: Strengthen the evidence base by collecting and consolidating local data to assess climate-related opportunities and challenges in rural areas.

• Capacity Building: Empower rural areas to develop effective transition strategies, providing them with the necessary conditions, such as knowledge, governance, data, and funding, to build climate resilience.

• Renewable Energy Deployment: Utilise rural regions' advantages in renewable energy production, link local innovation ecosystems to new green initiatives like hydrogen production.

• Ecosystem Services: Support sustainable land management and enhance natural capital to create value from ecosystem restoration.

• Circular and Bioeconomy: Promote the transition to a circular and bioeconomy, improving resource efficiency and creating new markets for rural businesses.

• Sustainable Mobility: Decarbonise rural transport by advancing sustainable mobility options.

Many OECD countries are progressing in these areas, and RACA supports effective use of available funds to accelerate the transition. Recent examples include:

• EU Common Agricultural Policy (2023-27), allocating EUR 387 billion to support farmers and rural areas in tackling climate change.

• US Department of Agriculture (2022), allocating over USD 914 million for climate-smart agriculture and USD 564 million for clean energy activities.

• Australian Government (2023), funding AUD 100 million for the Port Bonython Hydrogen Hub, comprised of AUS 70 million from the Federal Government and AUD 30 million from the South Australian State Government to support creating regional jobs and the enhancement renewable energy capacity.

Sustainable mobility is a critical area for reducing GHG emissions in rural regions, where higher per capita CO2 emissions are due to extensive car use and limited public transport. Policy makers must address the movement of people and goods in these regions, considering the impact on accessibility, community resilience, and sustainable development.

3.9.1. Circular models can help address rural challenges, while strengthening regional economies and natural ecosystems

The circular economy presents a significant opportunity for rural areas close to urban centres to reduce waste, optimise resource use, and create economic value through sustainable practices. These regions have the potential to integrate into urban circular economy strategies by acting as key suppliers of bio-based materials, recycling hubs, and participants in industrial symbiosis initiatives (OECD, 2020[95]).The proximity to urban markets facilitates the development of closed-loop systems, where organic and inorganic waste from cities can be repurposed into rural-based production cycles, creating added value while reducing environmental impact (Ellen MacArthur Foundation, 2019[96]).

A well-functioning circular economy in rural areas close to urban centres relies on three key principles:

• Designing out waste and pollution: Implementing policies that prevent resource depletion by promoting eco-design, extended product lifespans, and sustainable production models.

• Keeping products and materials in use: Developing strategies to foster reuse, repurposing, and remanufacturing, creating business opportunities in local economies.

• Regenerating natural systems: Supporting practices that improve soil health, water conservation, and biodiversity through circular agricultural models and sustainable land use.

The circular economy has strong economic potential. Estimates suggest that shifting from a linear “take-make-dispose” model to a circular system could generate up to USD 4.5 trillion in economic growth by 2030 (OECD, 2020[95]). Additionally, circular activities such as repair, remanufacturing, and recycling are more labour-intensive than traditional extraction and production sectors, offering job creation opportunities for rural communities. Thus, the circular economy presents a significant opportunity for rural areas close to urban centres to reduce waste, optimise resource use, and create economic value through sustainable practices. These regions have the potential to integrate into urban circular economy strategies by acting as key suppliers of bio-based materials, recycling hubs, and participants in industrial symbiosis initiatives (OECD, 2020[95]). The proximity to urban markets facilitates the development of closed-loop systems, where organic and inorganic waste from cities can be repurposed into rural-based production cycles, creating added value while reducing environmental impact (Ellen MacArthur Foundation, 2019[96]). A well-functioning circular economy in rural areas close to urban centres relies on three key principles:

• Resource Efficiency: Ensuring that materials are reused, recycled, and reintegrated into production systems to minimise waste and reduce environmental footprints.

• Rural-urban Synergies: Strengthening collaboration between urban industries and rural production networks to enhance material flows, particularly in bioeconomy sectors.

• Economic Diversification: Using circular economy principles to develop new rural business models, such as bio-based industries, waste-to-energy solutions, and sustainable food systems.

Bioeconomy, a crucial building block for both the rural environment and economy

The bioeconomy is a key driver of sustainable economic development in rural areas close to urban centres. It encompasses the production and use of biological resources—such as crops, forests, fisheries, and organic waste—to develop new materials, chemicals, energy, and food products (OECD, 2018[97]). These bio-based solutions reduce dependence on fossil fuels, enhance environmental sustainability, and generate new economic opportunities. Additionally, the bioeconomy supports ecosystem restoration and biodiversity conservation by promoting sustainable land-use practices and reducing the environmental footprint of traditional industries.

The economic potential of the bioeconomy is significant. Estimates suggest that by 2030, the global bioeconomy could generate over USD 2 trillion annually and provide millions of new jobs in bio-based industries (OECD, 2009[98]). These benefits are particularly relevant for rural areas close to urban centres, where bio-based production can be integrated into existing supply chains and industrial ecosystems. Expanding bioeconomy initiatives can lead to more diversified rural economies, reducing reliance on traditional extractive industries and increasing resilience against market fluctuations.

Rural areas close to urban centres are well positioned to develop bioeconomy initiatives due to their access to raw materials, proximity to research and innovation hubs, and connections to urban markets. The availability of diverse biomass sources, combined with technological advancements in bio-refining and bioprocessing, enables these regions to integrate bio-based production into circular supply chains. By leveraging biomass resources efficiently, these regions can contribute to both rural and urban sustainability goals while fostering economic resilience. The bioeconomy is particularly relevant for sectors such as agriculture, forestry, and aquaculture, where value can be added by converting residues into bio-based materials, fuels, and high-value biochemicals. Urban food waste can also be redirected towards bioenergy production, creating an efficient rural-urban resource flow. Furthermore, biotechnological advancements are opening new opportunities for bio-based pharmaceuticals, biodegradable plastics, and sustainable construction materials, strengthening the economic potential of the bioeconomy. A strong bioeconomy relies on three core principles:

• Sustainable resource use: Ensuring that biological resources are managed efficiently and replenished for long-term environmental sustainability. This includes sustainable agricultural practices, reforestation efforts, and responsible fisheries management.

• Innovation and technology integration: Developing bio-based industries through research and collaboration between rural producers and urban technological centres. This involves scaling up industrial bio-refining, improving microbial processing techniques, and integrating digital tools to optimise resource efficiency.

• Circularity in biomass utilisation: Closing resource loops by using agricultural residues, food waste, and forestry by-products in industrial processes. This enhances waste valorisation and reduces reliance on non-renewable inputs, contributing to both economic efficiency and environmental resilience.

3.10. Policies for the environmental agenda: rural remote

Rural remote areas face unique environmental challenges due to their geographic isolation, lower population density, and limited access to infrastructure and services. These regions are often characterised by vast natural landscapes, extensive agricultural or forestry activities, and rich biodiversity. However, they also encounter difficulties in securing investment for environmental initiatives, developing resilient energy and water systems, and mitigating climate-related risks such as droughts, wildfires, and biodiversity loss.

Despite these challenges, remote rural areas also offer significant opportunities for sustainable environmental policies. Their large land areas make them well suited for renewable energy projects, carbon sequestration initiatives, and conservation programmes. In some contexts, they may also host infrastructure related to carbon capture, utilisation and storage (CCUS), particularly where geological and industrial conditions are favourable (see Box 3.19).

Additionally, these regions often serve as key providers of ecosystem services, such as clean water, air purification, and biodiversity protection, which benefit both rural and urban populations. Effective policy responses for rural remote areas must address both their environmental vulnerabilities and their potential contributions to sustainability. Strategies should focus on enhancing resilience to climate change, ensuring access to clean energy and water, and promoting land stewardship practices that balance economic activities with environmental protection. Given the demographic trends in many remote rural areas—including ageing populations and outmigration—policies should also consider ways to create sustainable livelihoods and attract new residents or businesses.

3.10.1. Leveraging on the RE production capacity to push rural areas forward

Remote rural areas play a crucial role in the expansion of renewable energy (RE) due to their vast land availability and access to natural resources such as wind, solar, hydro, and bioenergy (OECD, 2021[60]). Chapter 2 highlighted how rural areas already host the majority of renewable energy infrastructure, yet they face structural challenges such as grid connectivity, seasonal variability, and financial constraints in developing new projects. The decentralised nature of energy production in remote areas requires tailored policy interventions to ensure that energy remains both accessible and cost-competitive.

Expanding renewable energy in rural remote areas requires a multi-dimensional approach. Strengthening decentralised energy solutions such as off-grid and microgrid systems can improve energy access while increasing resilience against power disruptions (IEA, 2024[99]). Investments in infrastructure, particularly in grid connectivity and energy storage, are crucial to address seasonal fluctuations and ensure a stable energy supply. Additionally, renewable energy projects offer an opportunity for economic diversification by fostering local innovation ecosystems and supporting new business models that extend beyond energy production (OECD, 2021[60]). The transition to renewables also demands a skilled workforce capable of operating and maintaining energy infrastructure. Implementing targeted training programmes can help rural workers acquire the necessary technical skills, opening new employment opportunities in the renewable energy sector. Furthermore, encouraging community engagement through energy co‑operatives and local ownership models can ensure that economic benefits are retained within rural communities, fostering long-term sustainability (OECD, 2019[100]). Streamlining regulatory frameworks is also essential to facilitate small- and medium-scale renewable projects, reducing administrative burdens and accelerating project deployment (OECD, 2023[101]). By integrating these strategies, rural remote areas can position themselves as key players in the energy transition, contributing to national decarbonisation goals while securing local economic resilience (Vermeulen, 2022[102]).

Building local capacity through green jobs and technological innovation

The transition to renewable energy also presents significant opportunities for rural communities to strengthen their local economies. The expansion of the green energy sector is expected to generate up to 100 million green jobs across OECD countries (20% of total), with 30% of those jobs being based in rural areas (approximately 24 million in 2021). These jobs, primarily focused on renewable energy infrastructure, maintenance, and innovation, can help revitalize local economies while contributing to national decarbonisation goals. By attracting skilled workers through targeted training programs, rural areas can benefit from a new wave of employment opportunities that foster long-term resilience and promote technological advancements (OECD, 2024[103]), (OECD, 2023[104]).

Fostering community engagement and overcoming barriers to adoption on RE projects

As remote rural regions embrace renewable energy, community engagement becomes a crucial factor in ensuring long-term sustainability. By encouraging local ownership models and energy co‑operatives, rural communities can retain the economic benefits of renewable energy while building stronger, more resilient economies (OECD, 2012[61]). These community-led initiatives not only provide energy security but also empower residents to shape their energy future.

However, there are barriers to the widespread adoption of green technologies in these areas. Remote regions often struggle with limited access to funding, insufficient infrastructure, and a lack of skilled workers. Overcoming these challenges requires a multi-faceted approach, including investments in digital and physical infrastructure, financial incentives, and targeted training programs to build local capacity. With proper support, these regions can effectively bridge the gaps in access to green technologies and contribute to the overall global energy transition (OECD, 2022[105]). The role of rural regions in achieving national and global sustainability targets cannot be underestimated. By strategically investing in renewable energy, fostering local innovation, and empowering communities, rural areas can position themselves not only as key players in the energy transition but also as economic hubs for green technologies and sustainable growth. Many OECD countries are employing place-based instruments to facilitate the shift to clean energy and modernise infrastructure in rural communities. Such strategies often entail targeted investments that consider local energy needs, community capacity, and long-term sustainability goals.

Maximising the development benefits of resource exploitation in rural areas

The extraction and use of natural resources remain foundational to the economies of many rural remote regions. Industries such as mining, forestry, and large-scale agriculture are key sources of employment and economic activity (OECD, 2023[27]). However, the extraction processes associated with these industries also generate significant environmental challenges. The scale and intensity of resource extraction in rural areas often result in deforestation, soil degradation, water contamination, and loss of biodiversity. Additionally, resource-based industries are major contributors to greenhouse gas (GHG) emissions and other pollutants, exacerbating environmental concerns (OECD, 2023[27]).

One of the core challenges faced by resource-rich rural regions is ensuring that the economic benefits of natural resource extraction do not come at the expense of long-term environmental sustainability. The high levels of land and water usage associated with industries like mining and forestry often disrupt local ecosystems and place immense pressure on biodiversity. These industries are also highly dependent on global commodity markets, which makes rural economies susceptible to market volatility. Such volatility often leads to boom-and-bust cycles (Papyrakis and Raveh, 2013[106]), where environmental degradation occurs during periods of resource booms, while downturns leave local communities with inadequate investment in environmental restoration. A sustainable approach to resource exploitation requires a balance between economic opportunity and environmental stewardship.

Table 3.10. Resource exploitation - Policy implications

Mining	Forestry	Water
Mining, a key industry in many resource-rich rural regions, contributes significantly to economic growth but also leads to substantial environmental degradation. The extraction of minerals and metals often results in soil degradation, water contamination, and destruction of ecosystems.	Forestry is another resource-intensive industry that is essential to many rural economies, particularly in regions with abundant forests. However, unsustainable logging practices can lead to deforestation, habitat destruction, and soil erosion. To balance forestry’s economic benefits with environmental protection.	Water is a critical resource for both economic and environmental sustainability in rural regions. Mining, agriculture, and forestry all have significant water demands, and improper water management can lead to contamination and depletion of local water sources.
Some policy actions: Promoting sustainable extraction practices. Sustainable extraction practices focus on minimizing environmental damage. In mining, methods like underground mining reduce land disturbance, while in forestry, selective logging preserves forest health. These approaches help maintain the environment while allowing industries to continue operations. Strengthening Environmental Governance: Stronger environmental governance ensures industries follow sustainable practices. For example, Canada’s mining regulations require land restoration post-extraction. Monitoring and enforcement prevent long-term environmental harm, ensuring industries adhere to regulations and protect ecosystems.
Enhancing Community-Led Conservation Efforts. Local communities play a key role in conservation. Indigenous groups in the Amazon, for instance, use traditional practices to manage resources sustainably. Empowering communities fosters ownership and helps ensure conservation efforts are effective and culturally appropriate. Integrating Circular Economy Principles Circular economy principles encourage reuse and recycling. In forestry, wood waste is repurposed for energy or products. Mining tailings can be processed for additional minerals. This reduces reliance on virgin resources and creates new economic opportunities through material recovery. Resource Efficiency: Resource efficiency focuses on using resources wisely. In agriculture, precision farming reduces water and fertilizer use. In mining, improving recovery rates reduces the need for new extraction. Efficient resource use lowers environmental impact while maintaining economic benefits.

Box 3.19. Rural opportunities in the decarbonisation efforts

Carbon capture, utilisation and storage (CCUS) is increasingly recognised as a key component of national and regional decarbonisation strategies, especially in hard-to-abate sectors such as cement, steel, and chemicals. While still at an early stage of deployment in many countries, CCUS projects are expanding and may represent an emerging opportunity for rural regions, particularly those with suitable geological formations, legacy industrial infrastructure, or connections to energy networks.

Rural areas may be well positioned to host different components of the carbon value chain. Some territories offer favourable storage conditions, such as depleted oil and gas fields or deep saline aquifers. Others can accommodate transport infrastructure or low-carbon industrial hubs. For example, Scotland’s Acorn Project, located in a rural coastal area, is re-purposing former North Sea gas infrastructure to store CO₂ emissions offshore. The project is part of the Scottish Cluster, which is expected to support up to 10,800 jobs during construction and generate £9 billion in economic output, including direct benefits for rural communities in Aberdeenshire and beyond (AGCC, 2025[107]).

However, CCUS deployment in rural areas requires careful policy design and territorial consideration. Projects must be aligned with local environmental priorities, including land use, biodiversity, and water resources. Transparent planning processes and early community engagement are essential to ensure public acceptance and mitigate risks related to social opposition or environmental trade-. As noted in recent studies, public perception of CCUS remains mixed, and trust in institutions plays a key role in shaping support in rural contexts offs (Kim and Ladenburg, 2024[108]) and (Stavrianakis, Nielsen and Morrison, 2024[109])

From a rural policy perspective, there is scope to explore CCUS as a place-based instrument—but only under the right conditions. Pilot initiatives in well-suited areas could be supported through targeted investment, technical assistance, and knowledge sharing. Ensuring that rural communities receive tangible benefits (similar discussion to natural resource extraction, or renewable energy projects), such as employment, training, or revenue-sharing mechanisms, can increase the viability and legitimacy of CCUS projects. Long-term monitoring and adaptive governance will also be necessary to ensure that rural participation contributes to broader decarbonisation goals without undermining local sustainability.

References

[107] AGCC (2025), ‘Scotland must not be left behind’: business leaders unite behind Acorn, https://www.agcc.co.uk/news-article/scotland-must-not-be-left-behind-business-leaders-unite-behind-acorn?.

[70] AIHW (2023), Australian Institute of Health and Welfare, https://www.aihw.gov.au/reports/australias-welfare/australias-welfare-2023-in-brief/summary.

[48] ANCT (2024), Petites Villes de demain, https://agence-cohesion-territoires.gouv.fr/petites-villes-de-demain-45.

[72] Arango, J. (2017), La tenencia de tierras colectivas en Colombia: Datos y tendencias, https://doi.org/10.17528/cifor/006704.

[78] Australian Government (2024), Key elements of the Basin Plan, https://www.mdba.gov.au/water-management/basin-plan/key-elements-basin-plan.

[76] Beamer, K. et al. (2023), “Island and Indigenous systems of circularity: how Hawaiʻi can inform the development of universal circular economy policy goals”, Ecology and Society, Vol. 28/1, https://doi.org/10.5751/es-13656-280109.

[14] Becattini, G., M. Bellandi and L. De Propris (2009), “A Handbook of Industrial Districts”, A Handbook of Industrial Districts, p. 863, https://www.academia.edu/71177516/A_Handbook_of_Industrial_Districts (accessed on 15 April 2025).

[32] BioNorth Energy (2024), BioNorth Energy Limited Partnership, https://bionorth.ca/.

[15] Boschma, R. and K. Frenken (2011), “Technological Relatedness, Related Variety and Economic Geography”, in Handbook of Regional Innovation and Growth, Edward Elgar Publishing, https://doi.org/10.4337/9780857931504.00028.

[54] Bournisien de Valmont, M. (2024), AI: Mirage or miracle for service delivery in shrinking, OECD Cogito Blog, 4 April 2024, https://oecdcogito.blog/2024/04/04/ai-mirage-or-miracle-for-service-delivery-in-shrinking-regions/.

[80] British Columbia Gov (2024), Great Bear Rainforest agreement highlights, https://www2.gov.bc.ca/gov/content/environment/natural-resource-stewardship/great-bear-rainforest/gbr-agreement-highlights.

[63] CEFIM (2024), Mobilising Finance and Investment in Clean Energy in Emerging Economies, https://www.oecd.org/content/dam/oecd/en/about/programmes/cefim/OECD-clean-energy-finance-and-investment-mobilisation-programme-brochure.pdf.

[91] Choose Paris Region (2024), Circular Economy, https://www.chooseparisregion.org/industries/circular-economy.

[88] Circular Flanders (2024), Why and how Flanders is investing in the circular economy, https://vlaanderen-circulair.be/en/approach/what-and-why.

[71] Conservation International (2023), 3 ways Indigenous knowledge protects nature, https://www.conservation.org/blog/3-ways-indigenous-knowledge-protects-nature#:~:text=Despite%20representing%20less%20than%205,80%20percent%20of%20global%20biodiversity.

[40] Dasgupta, P. and J. Morton (2014), : Rural areas. In: Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects, Cambridge University, https://www.ipcc.ch/site/assets/uploads/2018/02/WGIIAR5-Chap9_FINAL.pdf.

[3] Duranton, G. and A. Venables (2018), Place-Based Policies for Development, National Bureau of Economic Research, Cambridge, MA, https://doi.org/10.3386/w24562.

[56] EC, J. et al. (2022), New perspectives on territorial disparities - Publications Office of the EU, Publications Office of the European Union, https://op.europa.eu/en/publication-detail/-/publication/8fcaf458-f1da-11ec-a534-01aa75ed71a1/language-en (accessed on 24 August 2022).

[96] Ellen MacArthur Foundation (2019), Completing the Picture: How the Circular Economy Tackles Climate Change, https://www.ellenmacarthurfoundation.org/publications/completing-the-picture-how-the-circular-economy-tackles-climate-change.

[82] Federal Government of Germany (2024), Joint Task for the “Improvement of Agricultural Structures and Coastal Protection”, https://www.bmel.de/EN/topics/rural-regions/rural-development-support/gak.html.

[7] Felipe, J. (2021), “Structural Transformation, Old and New Industrial Policies, and Implications for Development”, in New Perspectives on Structural Change, Oxford University Press, https://doi.org/10.1093/oso/9780198850113.003.0027.

[73] First Nations Clean Energy Network (2024), What is the Indigenous Rangers Program?, https://www.firstnationscleanenergy.org.au/what_is_the_indigenous_rangers_program.

[12] Foray, D., P. David and B. Hall (2009), Smart Specialisation-The Concept, http://ec.europa.eu/invest-in-research/monitoring/knowledge_en.htm.

[13] Foray, D., M. Eichler and M. Keller (2021), “Smart specialization strategies—insights gained from a unique European policy experiment on innovation and industrial policy design”, Review of Evolutionary Political Economy, Vol. 2/1, pp. 83-103, https://doi.org/10.1007/s43253-020-00026-z.

[92] Fountain, J. and M. Lück (2024), Ecotourism case studies Tāmaki Makaurau Auckland and Akaroa, https://www.sustainableseaschallenge.co.nz/assets/dms/Reports/Ecotourism-case-studies/Ecotourism-case-studies.pdf.

[85] GEJ (2024), Returning Land to the River: Planned Relocation in the Netherlands, https://www.greeneuropeanjournal.eu/land-to-the-river-planned-relocation-in-the-netherlands/.

[93] GeorgeTownClimate (2017), Preparing for Climate Change in Texas, https://www.georgetownclimate.org/adaptation/state-information/texas/overview.html.

[69] Hajizadeh, M. et al. (2018), “Socioeconomic inequalities in health among Indigenous peoples living off-reserve in Canada: Trends and determinants”, Health Policy, Vol. 122/8, pp. 854-865, https://doi.org/10.1016/j.healthpol.2018.06.011.

[11] Hausmann, R. and D. Rodrik (2002), Economic development as self-discovery, https://doi.org/10.3386/w8952.

[79] ICCA (2025), Explore Case Studies: Áldujohka Sámi, Finland, https://www.iccaregistry.org/en/explore/finland/aldujohka-sami?.

[99] IEA (2024), Global overview Renewable energies, https://www.iea.org/reports/renewables-2024/global-overview#.

[25] International Trade Administration (2023), Chile Country Commercial Guide, https://www.trade.gov/country-commercial-guides/chile-mining?.

[94] Interreg-baltic (2019), RESPONSE, https://interreg-baltic.eu/project/response/.

[89] Jolly, S. and T. Hansen (2025), “Conflicting narratives and power dynamics in the transition towards circular bioeconomy in Swedish regions 1”, in Research Handbook of Innovation in the Circular Bioeconomy, Edward Elgar Publishing, https://doi.org/10.4337/9781035307968.00013.

[83] Kānoa (2023), Studies confirm Kānoa-managed investments had positive impacts for sectors and communities, https://www.growregions.govt.nz/about-us/news/studies-confirm-kanoa-managed-investments-had-positive-impacts-for-sectors-and-communities.

[108] Kim, J. and J. Ladenburg (2024), “Public demand for carbon capture and storage varies with information, development magnitude and prior familiarity”, Communications Earth & Environment, Vol. 5/1, https://doi.org/10.1038/s43247-024-01900-y.

[75] Kumari, M. et al. (2022), “Integrated approach for technology transfer awareness of traditional knowledge for upliftment of circular bioeconomy”, in Biomass, Biofuels, Biochemicals, Elsevier, https://doi.org/10.1016/b978-0-323-89855-3.00005-4.

[65] Lam, S. et al. (2019), “Community-based monitoring of Indigenous food security in a changing climate: global trends and future directions”, Environmental Research Letters, Vol. 14/7, p. 073002, https://doi.org/10.1088/1748-9326/ab13e4.

[86] Lee, K. et al. (2020), “The Integration of Remote Sensing and Field Surveys to Detect Ecologically Damaged Areas for Restoration in South Korea”, Remote Sensing, Vol. 12/22, p. 3687, https://doi.org/10.3390/rs12223687.

[77] MAFF (2024), Strategy for Sustainable Food Systems, https://www.maff.go.jp/j/pr/annual/pdf/midori-1.pdf.

[30] Mateo-Peinado, L. (2022), “Natural resources, (Mis)governance, and the lack of diversification in mining regions: A reconsideration of the Dutch disease at a local level”, The Extractive Industries and Society, Vol. 11, https://doi.org/10.1016/j.exis.2022.101099.

[2] Mazzucato, M., S. Doyle and L. Von Burgsdorff (2024), Mission-oriented industrial strategy: global insights.

[17] McCann, P. and R. Ortega-Argilés (2016), “The early experience of smart specialization implementation in EU cohesion policy”, European Planning Studies, Vol. 24/8, pp. 1407-1427, https://doi.org/10.1080/09654313.2016.1166177.

[36] Mineral Resources Cluster Portugal (2024), Home, https://www.clustermineralresources.pt/?lang=en.

[26] Minerals Council of Australia (2023), Mining delivers record $455 billion in export revenue in FY23, https://minerals.org.au/resources/mining-delivers-record-455-billion-in-export-revenue-in-fy23/?.

[53] Moreno Monroy, A. (2022), Selective service – how gaps in public provision are undermining life chances in rural communities, OECD Cogito blog, 18 November 2022, https://oecdcogito.blog/2022/11/18/selective-service-how-gaps-in-public-provision-are-undermining-life-chances-in-rural-communities/.

[19] Mudambi, R. (2008), “Location, control and innovation in knowledge-intensive industries”, Journal of Economic Geography, Vol. 8/5, pp. 699-725, https://doi.org/10.1093/JEG/LBN024.

[29] Muhammad Shafiullah, S. et al. (2018), “Examining Dutch disease across Australian regions”, The world economy, Vol. 42/2, pp. 590-613.

[81] NFWF (2021), Northern Great Plains Program, https://www.nfwf.org/programs/northern-great-plains-program?activeTab=tab-1.

[66] Nuttall, M. (2007), “An environment at risk: Arctic indigenous peoples, local livelihoods and climate change”, in Arctic Alpine Ecosystems and People in a Changing Environment, Springer Berlin Heidelberg, Berlin, Heidelberg, https://doi.org/10.1007/978-3-540-48514-8_2.

[8] OECD (2025), Place-Based Policies for the Future, OECD Publishing, Paris, https://doi.org/10.1787/e5ff6716-en.

[43] OECD (2024), Getting to Services in Towns and Villages: Preparing Regions for Demographic Change, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/df1e9b88-en.

[74] OECD (2024), Making critical minerals work for sustainability, growth, and development, https://www.oecd.org/en/topics/sustainable-mining-for-development.html.

[103] OECD (2024), OECD Employment Outlook 2024: The Net-Zero Transition and the Labour Market, OECD Publishing, Paris, https://doi.org/10.1787/ac8b3538-en.

[18] OECD (2024), OECD Regional Statistics (database), https://www.oecd.org/regional/regional-statistics/ (accessed on 15 January 2024).

[39] OECD (2024), OECD Tourism Trends and Policies 2024, OECD Publishing, Paris, https://doi.org/10.1787/80885d8b-en.

[42] OECD (2024), Tourism continues to recover from COVID but faces renewed challenges, https://www.oecd.org/en/blogs/2024/07/tourism-continues-to-recover-from-covid-but-faces-renewed-challenges.html.

[57] OECD (2023), A Territorial Approach to Climate Action and Resilience, OECD Regional Development Studies, OECD Publishing, Paris, https://doi.org/10.1787/1ec42b0a-en.

[101] OECD (2023), Economic Policy Reforms 2023: Going for Growth, OECD Publishing, Paris, https://doi.org/10.1787/9953de23-en.

[104] OECD (2023), Job Creation and Local Economic Development 2023: Bridging the Great Green Divide, OECD Publishing, Paris, https://doi.org/10.1787/21db61c1-en.

[35] OECD (2023), Mining Regions and Cities Case of the Pilbara, Australia, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/a1d2d486-en.

[33] OECD (2023), Mining Regions and Cities in the Region of Antofagasta, Chile: Towards a Regional Mining Strategy, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/336e2d2f-en.

[22] OECD (2023), The Future of Rural Manufacturing, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/e065530c-en.

[27] OECD (2023), “Toolkit to measure well-being in mining regions”, OECD Regional Development Papers, No. 41, OECD Publishing, Paris, https://doi.org/10.1787/5a740fe0-en.

[52] OECD (2022), Addressing territorial disparities in future infrastructure needs in the wake of the COVID-19 crisis: A G20 perspective, OECD Publishing, Paris, https://doi.org/10.1787/e246f50f-en.

[105] OECD (2022), Unlocking Rural Innovation, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/9044a961-en.

[58] OECD (2021), Bridging digital divides in G20 countries, OECD Publishing, Paris, https://doi.org/10.1787/35c1d850-en.

[21] OECD (2021), Bridging digital divides in G20 countries, OECD Publishing, Paris, https://doi.org/10.1787/35c1d850-en.

[45] OECD (2021), Delivering Quality Education and Health Care to All: Preparing Regions for Demographic Change, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/83025c02-en.

[49] OECD (2021), OECD Regional Outlook 2021 Addressing COVID-19 and Moving to Net Zero Greenhouse Gas Emissions, https://doi.org/10.1787/17017efe-en.

[60] OECD (2021), The Rural Agenda for Climate Action (RACA), https://www.oecd.org/content/dam/oecd/en/topics/policy-sub-issues/environmental-transition-in-regions/oecd-rural-agenda-for-climate-action.pdf/_jcr_content/renditions/original./oecd-rural-agenda-for-climate-action.pdf.

[59] OECD (2020), “A roadmap for delivering well-being in rural regions”, in Rural Well-being: Geography of Opportunities, OECD Publishing, Paris, https://doi.org/10.1787/42e73324-en.

[55] OECD (2020), Realising the Potential of Primary Health Care, OECD Health Policy Studies, OECD Publishing, Paris, https://doi.org/10.1787/a92adee4-en.

[46] OECD (2020), Rural Well-being: Geography of Opportunities, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/d25cef80-en.

[95] OECD (2020), The Circular Economy in Cities and Regions: Synthesis Report, OECD Urban Studies, OECD Publishing, Paris, https://doi.org/10.1787/10ac6ae4-en.

[37] OECD (2019), Linking Indigenous Communities with Regional Development, OECD Rural Policy Reviews, OECD Publishing, Paris, https://doi.org/10.1787/3203c082-en.

[5] OECD (2019), Regions in Industrial Transition: Policies for People and Places, OECD Publishing, Paris, https://doi.org/10.1787/c76ec2a1-en.

[100] OECD (2019), Regions in Industrial Transition: Policies for People and Places, OECD Regional Development Studies, OECD Publishing, Paris, https://doi.org/10.1787/c76ec2a1-en.

[20] OECD (2019), Rural well-being : geography of opportunities.

[97] OECD (2018), Meeting Policy Challenges for a Sustainable Bioeconomy, OECD Publishing, Paris, https://doi.org/10.1787/9789264292345-en.

[1] OECD (2018), “Rural 3.0: A Framework for Rural Development”, OECD Regional Development Papers, No. 93, OECD Publishing, Paris, https://doi.org/10.1787/618f702b-en.

[62] OECD (2015), Policy Guidance for Investment in Clean Energy Infrastructure: Expanding Access to Clean Energy for Green Growth and Development, OECD Publishing, Paris, https://doi.org/10.1787/9789264212664-en.

[24] OECD (2015), The Metropolitan Century: Understanding Urbanisation and its Consequences, OECD Publishing, Paris, https://doi.org/10.1787/9789264228733-en.

[23] OECD (2013), Rural-Urban Partnerships: An Integrated Approach to Economic Development, OECD Rural Policy Reviews, OECD Publishing, Paris, https://doi.org/10.1787/9789264204812-en.

[61] OECD (2012), Linking Renewable Energy to Rural Development, OECD Green Growth Studies, OECD Publishing, Paris, https://doi.org/10.1787/9789264180444-en.

[4] OECD (2009), Regions Matter: Economic Recovery, Innovation and Sustainable Growth, OECD Publishing, Paris, https://doi.org/10.1787/9789264076525-en.

[98] OECD (2009), The Bioeconomy to 2030: Designing a Policy Agenda, OECD Publishing, Paris, https://doi.org/10.1787/9789264056886-en.

[50] OECD (Forthcoming), Shrinking Smartly and Sustainably: Policy Framework.

[6] OECD (forthcoming), Unpacking Place Transformation.

[51] OECD/EC-JRC (2021), Access and Cost of Education and Health Services: Preparing Regions for Demographic Change, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/4ab69cf3-en.

[84] Orkney (2025), , https://www.orkney.com/life/energy/hydrogen?.

[38] Owen, J. et al. (2022), “Energy transition minerals and their intersection with land-connected peoples”, Nature Sustainability, Vol. 6/2, pp. 203-211, https://doi.org/10.1038/s41893-022-00994-6.

[28] Papyrakis, E. and O. Raveh (2014), “An Empirical Analysis of a Regional Dutch Disease: The Case of Canada”, Vol. 58/179-198, https://doi.org/10.1007/s10640-013-9698-z.

[106] Papyrakis, E. and O. Raveh (2013), “An Empirical Analysis of a Regional Dutch Disease: The Case of Canada”, Environmental and Resource Economics, Vol. 58/2, pp. 179-198, https://doi.org/10.1007/s10640-013-9698-z.

[67] Pearson, J., G. Jackson and K. McNamara (2021), “Climate-driven losses to knowledge systems and cultural heritage: A literature review exploring the impacts on Indigenous and local cultures”, The Anthropocene Review, Vol. 10/2, pp. 343-366, https://doi.org/10.1177/20530196211005482.

[68] Reid, P., D. Cormack and S. Paine (2019), “Colonial histories, racism and health—The experience of Māori and Indigenous peoples”, Public Health, Vol. 172, pp. 119-124, https://doi.org/10.1016/j.puhe.2019.03.027.

[10] Rodrik, D. (2008), “Industrial Policy: don’t ask why, ask how”, Middle East Development Journal Demo Issue, pp. pp 1-29, https://doi.org/10.1142/S1793812009000024.

[9] Rodrik, D. (2004), Industrial Policy for the Twenty-First Century, https://doi.org/10.2139/ssrn.617544.

[64] Standen, J. et al. (2022), “Aboriginal Population and Climate Change in Australia: Implications for Health and Adaptation Planning”, International Journal of Environmental Research and Public Health, Vol. 19/12, p. 7502, https://doi.org/10.3390/ijerph19127502.

[109] Stavrianakis, K., J. Nielsen and Z. Morrison (2024), “Public perception and acceptance of CCUS: preliminary findings of a qualitative case study in Greece”, Open Research Europe, Vol. 3, p. 205, https://doi.org/10.12688/openreseurope.16663.3.

[44] Tātai Aho Rau Core Education (2017), Communities of Learning | Kāhui Ako, https://core-ed.org/en_NZ/ten-trends/2017-ten-trends/communities-of-learning-kahui-ako/.

[41] UN Tourism (2020), Secretary-General’s Policy Brief on Tourism and COVID-19, https://www.unwto.org/tourism-and-covid-19-unprecedented-economic-impacts.

[47] UNC School of Medicine (2024), UNC Health Rolls Out New Hearing and Speech Mobile Clinic, May 2024, https://news.unchealthcare.org/2024/05/unc-health-rolls-out-new-hearing-and-speech-mobile-clinic/.

[34] Vella, K. et al. (2015), “Not Learning from the Past: Adaptive Governance Challenges for Australian Natural Resource Management”, Geographical Research, Vol. 53/4, pp. 379-392.

[102] Vermeulen, W. (2022), “Policies for resilient local economies”, OECD Local Economic and Employment Development (LEED) Papers, No. 2022/09, OECD Publishing, Paris, https://doi.org/10.1787/872d431b-en.

[16] Wibisono, E. (2022), “Multilevel governance and Smart Specialization in EU regions: an evidence-based critical review”, European Journal of Government and Economics, Vol. 11/2, pp. 234-250, https://doi.org/10.17979/ejge.2022.11.2.9004.

[87] WIP Renewable Energies (2014), Community energy in Germany: existing models, public-private funding and good practice examples, https://www.rescoop.eu/uploads/rescoop/downloads/Community-energy-in-Germany-report-2014.pdf?utm.

[31] Young, A., M. Barreto and K. Chovan (2021), Towards a Circular Economy Approach to Mining Operations. Key Concepts, Drivers and Opportunities, Enviro Integration Strategies Inc., MERG.

[90] Zero Waste Center Kamikatsu (2022), Why, https://why-kamikatsu.jp/en/.

Notes

← 1.  See Hausmann, R., & Rodrik, D. (2002) for the introduction of the concept of embedded industrial policy.

← 2.  This process is described in Rodrik, D. (2008), “Industrial Policy: don’t ask why, ask how”, Middle East Development Journal, Demo Issue (2008) 1–29.

← 3.  Source: OECD (2023), The Future of Rural Manufacturing, OECD Rural Studies, OECD Publishing, Paris, https://doi.org/10.1787/e065530c-en.

← 4.  See We are the Energiewende: German villages go 100% renewable | EnergyTransition.org

← 5.  See: Regions in Industrial Transition 2023: New Approaches to Persistent Problems, OECD Regional Development Studies, OECD Publishing, Paris. https://doi.org/10.1787/5604c2ab-en.

← 6.  see Bianchi, P. and S. Labory (2019), “Regional industrial policy for the manufacturing revolution: enabling conditions for complex transformations”, Cambridge Journal of Regions, Economy and Society, Vol. 12/2, pp. pp 233-249, https://doi.org/10.1093/cjres/rsz004

← 7.  Source: https://www.oecd.org/en/topics/sub-issues/productivity-and-innovation-in-regions.html

← 8.  The manufacturing sector’s direct contribution to rural GVA increased in OECD rural regions from 18.5% to 21.1% from 2000 to 2019 and the sector also supports a significant proportion of upstream service sector jobs, including in metropolitan regions. Source: OECD (2023), The Future of Rural Manufacturing.