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Content archived on 2023-04-17

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Building rural resilience in a post-coronavirus economy

Thomas Norrby, from the Swedish Agricultural University, is an expert in rural entrepreneurship and explains how some communities can come out of the coronavirus pandemic stronger than ever.

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Society icon Society
Food and Natural Resources icon Food and Natural Resources

How have rural economies been affected by COVID-19? Hotels and restaurants have a really tough time because of lockdown restrictions. It has already caused some businesses to go bankrupt – in just a matter of months. For the pan-European food sector, there does not seem to be major short-term issues because there is still production. However, the transport restrictions can cause problems on a national scale, like those depending on imports of fertilisers and animal feed, which may result in more long-term challenges. The lack of labour is also looking to be very problematic. The European Commission is proposing a bill that would allow seasonal workers to pass borders more easily. That’s important because if we do not get labour coming in that is going to hit harvests and could cause food waste, decreased supply and lost revenue. How have rural businesses responded to the lockdown restrictions? From a macro perspective, the economy is an ecosystem in the sense that some businesses die, but others rise from the ashes. There are also always creative and entrepreneurial solutions to problems – that’s what I think we’re seeing. I see a lot of actors in the tourism sector trying to raise funds to renew infrastructure or create new income possibilities – like building an extra cabin or feeding people eating at home. At the same time, you have a lot of layoffs so some rural entrepreneurs are trying to find new collaborations between the tourism and agricultural sector, like people from hotels sending their staff to work on farms where labour is needed. For the food sector, there has also been a trend that people are buying more local produce than ever before because they want to support these businesses during this time. If we can build on that momentum, it will be very positive for rural economies in the future. What else needs to happen to help rural economies become more resilient in the long run? The more businesses that close, the longer the recession will last. The European response to prevent a prolonged recession is to provide immense amounts of money (about €500 billion), but so far this support is for bigger businesses, which generally have less employers. This is because it is easier for governments to do this, but that means we have less measures that work for the numerous small businesses and self-employed people. We need more targeted support like cuts in employer tax, or innovative financial instruments like crowd funding. Then there is a capacity building opportunity by teaching people who have been laid off, or gone bankrupt, about circular economy business models and more resilient locally economies. Through Rubizmo, we are producing these types of modules to empower the business support sector to set up online training for those who need it. We have also created an agriculture system, which in this kind of peacetime crisis appears to lack resilience. That means it might be time to rethink how our rural society is organised. With a more diversified and possibly localized food sector, it is easier to change the production system in response to a crisis and that makes our societies more resilient.