Villages of the future

A lot has been written about the difficult (and, according to some authors, disastrous) situation of Ukrainian villages, and not only in the form of heartrending prose or poetry, but also in serious journalistic or scientific studies. Volodymyr Yurchyshyn has done some particuarly significant work in the field. Overall, the situation in the country is complicated, and in many places we can see real oases of development. While working in Volyn with local government bodies, I saw dozens of examples of courageous rural leaders who could raise the community to address development challenges. However, as the old Latin saying goes, “examples only illustrate, but prove nothing.” Villages need development, and this development needs financial, organizational, and other forms of support. Thus, there is a need for a comprehensive and systematic policy of rural development.

VILLAGE MODEL

The main problem of rural development is the lack of a comprehensive understanding of the future model of the village. People tend to associate villages solely with agriculture. At a closer look, however, this relationship is more ambiguous. Of course, most villages have a definite agricultural orientation, but many of them are going in different directions: suburban villages gravitate toward cities, others aim for leisure and recreation, and borderland villages are often engaged in shady businesses. There is no serious research on what the future of the village will be. And the fact that it will be different from what was imagined by not only Nikita Khrushchev or Volodymyr Shcherbytsky, but also by Ivan Pliushch or Leonid Kuchma is clear. The village of the future will lose much of what we normally consider “rural characteristics.”

However, thus far villages share many common problems: water, sewage, waste management, roads, social infrastructure, and extremely poor management of land resources. Demographic, logistical, and even legal problems also tend to appear. And these problems are snowballing. Is not it time to tackle the problem of rural development?

One can’t say that nothing has been done in this area. A national program of Ukrainian village development was even adopted. Back in 2005, they promised “to create a system of rural territory management which come closer to EU standards.” But in reality the program has no money and is in a unclear situation: it is rather a “collection of best wishes.” Moreover, the system of governance became even worse, because local government have lost almost all their resources and self-sufficiency. Perhaps we should look at what is happening in Europe? Europeans managed to fundamentally change not only the villages of “Old Europe,” where peace and relative prosperity always dominated, but also the rural settlements of the new members: Poland, Romania, Bulgaria, Slovakia, etc.

We would like to note that the rural development policy, like all other activities financed from the central budget, has a detailed methodological, theoretical, and organizational basis. Europeans acknowledge the well-known principle “score twice before you cut once.” In the theoretical debate between economists of liberal and Keynesian (supporters of state intervention) orientation the following important policy approaches to rural development policy were formed: a clear definition of rural territories; the right of rural residents to access public wealth; equal social rights for rural and urban residents; orientation towards a multifunctional development of villages; changing the social functions of villages. Thus, an approach was formed where state support is directed not so much to assist business, even agribusiness, as to promote the social development of villages and rural communities. Please note that this approach perfectly complies with the requirements of the World Trade Organization.

HOW TO SAVE DEPRESSED TERRITORIES

The Europeans began with the formation of a European working group on rural development and village renewal (ARGE), which is aimed at intensifying a cooperation of institutions, government bodies, and individuals working on issues of rural development. The group laid a kind of bridge between the economic development of agricultural businesses and rural development, but immediately noted that for some period of time the rural development policy should be independent and separated from agricultural policy. Two other important elements where the focus on individuals, and the development of depressed areas. Thus, everything became simpler: allocating resources to specific goals; announcing calls for proposals; forming initiative groups; prioritizing projects from depressed areas; holding competitions; realizing projects; monitoring the efficiency of projects. Somewhere beyond the simplified description of this algorithm, there was an awareness campaign, education, training, study tours, and forming partnerships.

A special role in the development of rural areas is played by human capital, area potential, and informal leaders. This is a practical reflection of the concept of post-industrial development in which human capital, initiative, and regional potential are as important as money and material resources. For informal leaders and their initiatives, the EU even formed a special program LEADER+. After training and practical tests in one or two projects people can become leaders in local action groups. This kind of a nucleus continues to spread initiative. People show that enthusiasm, initiative and action is needed, and then funds will be found. And it yields great results. Are there reasons to think it would be different in Ukraine, if the state apparatus switched from the oppression of initiatives to their support?

After the EU Lisbon Summit in 2005, the objectives and priorities of rural development policy have changed considerably. From that time on rural development policy and the common agricultural policy were integrated. Sustainability development is the basis of the concept, it presupposes the following: preserving natural resources and environment in a good condition; an effective transformation and use of resources and tools; ensuring equal and fair access to resources for different generations. A growing attention was paid to creating conditions for the formation of “multifunctional agriculture” and “multifunctional villages.” For the forthcoming period, three priority axes of action for all the EU countries were identified: competitiveness; environment and land management; multifunctional village and quality of life. Each axis has a list of approved programs, activities, methods of financing, evaluation criteria, and algorithm for monitoring performance. Imagine that the total number of support tools consists of 37 items. The total funding of those programs exceeds 52 billion Euros. And it is only through competition, without the visits to officials and committees or other procedures we often see at home. This is where choice, selection, and real action take place!

FROM FARMSTEAD TO TOWN

Again, Europeans thought the institutional framework through. To prevent national institutions such as ministries and committees from influencing the procedures and distorting them, the European Agricultural Fund for Rural Development (EAFRD) and its local offices were created.

Obviously, when creating the domestic rural development policy, one should use not only the basic principles and methodological approaches adopted in the EU, but also similar foundations of policy formation and certain priority positions. A clear classification and codification of measures of agricultural policy and rural development policy will unify this important part of economic policy. The task of institutional support for rural development policy is difficult but extremely important. Our domestic rural development policy cannot be a “field for improvisations.”

Elaborating standards for the development of rural settlements (farmstead, village, and town) and forming respective standards of funding may become a possible starting point for rural development policy in Ukraine.

Furthermore, the use of the experience, both theoretical and empirical, of EU countries, in particular that of the former post-communist countries of Central and Eastern Europe, will bring our domestic rural development policy closer to European norms and requirements. And this corresponds to the strategic objectives of our economic policy. A comparative analysis shows us just how important an administrative-territorial reform on the lowest local levels and increasing the role and economic potential of rural local governments truly is.

Yurii Hubeni is Doctor of Economics, professor, academician of the Ukrainian Academy of Economic Sciences, Independent Expert on Agrarian Policy