2019. március 3. vasárnap

Horizontal results of the ‘Smart Villages’ project


Table of Contents

Table of Figures.. iii
1. The ‘Smart Villages’ project ...1
   1.1 The concept and goals of the ‘Smart Villages’ project ...1
   1.2 Extending ‘Smart Cities’ to ‘Smart Villages’ ...2
   1.3 The groundwork of the ‘Smart Villages’ project....3
   1.4 Supporting the ‘Smart Villages’ project....5 
   1.4.1 The Common Agricultural Policy – Rural Development ....5
   1.4.2 EU Cohesion Policy.....6
   1.4.3 ‘Europe 2020’ and ‘Horizon 2020’ .....7
   1.4.4 Connecting Europe Facility and Trans-European Networks for Transport ..8
   1.4.5 Directorates-General ...9

2. Horizontal results of the ‘Smart Villages’ project .....10
2.1 Rural challenges in need of a solution....10
2.2 Digitization. ...13
2.2.1 Precision Farming...16
2.3 Social Innovation and Sustainability. ....17
2.4 Energy and Environmental ...19
2.5 Transport ...22

3. Outlook. ....24
List of references. ...26

 Table of Figures

Figure 1. The 'circle of decline' ......4
Figure 2. The contribution of CAP instruments to the Commission general objectives, as managed by DG AGRI ......9
Figure 3. Rural population change, 2017....11
Figure 4. Old-age dependency ratio (the number of people aged 65+ compared with the number of people aged 15-64, expressed in percentage terms), by NUTS 3 regions, 2017. 12
Figure 5. Next Generation Access coverage (percentage of households), 2017....14
Figure 6. Individuals accessing the internet on a daily basis, by degree of urbanization, 2016. ....14
Figure 7.The FIGARO project .....16
Figure 8. Social innovation....19
Figure 9. Artic Smart Community Cluster ....20
Figure 10. The Bioenergy Villages Project . … 21
Figure 11. Bwcabus project details and funding. .....23
Figure 12. FLIPPER project details and budget ......24


This paper looks into the horizontal results of the ‘Smart Villages’ project as well as its preparatory action in the fields of digitization, social innovation and sustainability, energy and environment, and transport. After introducing the initiative and mapping the opportunities and challenges in rural areas, the study provides examples of rural areas able to use their existing assets to improve their life quality and boost their potential. Budgetary aspects of the concept will be considered, including already existing and potential funding opportunities.

1. The ‘Smart Villages’ project

1.1 The concept and goals of the ‘Smart Villages’ project
More than half of the EU’s land area is within regions classified as predominantly rural; these areas are inhabited by more than 112 million people. Rural communities face a number of linked challenges including depopulation, poverty, the aging of the population and the lack of good infrastructure. In order to be able to solve these challenges, the EU needs to invest in people, in ideas and in businesses; in local communities and in the surrounding countryside. Digital infrastructure needs to be supported and rural citizens need to be empowered to develop on and off-line solutions that strengthen rural vitality – through social innovation and smart specialization.

The ‘Smart Villages’ initiative aims to make inhabitants’ and businesses’ lives easier and more comfortable in European rural areas, with the help of innovative, digital solutions. According to the ‘EU Action for Smart Villages’, ‘Smart Villages’ are rural areas and communities which build on their existing strengths and assets as well as on developing new opportunities, in order to engage in a process of sustainable development of their territories. In ‘Smart Villages’, traditional and new networks and services are enhanced by means of digital, telecommunication technologies, innovations and the better use of knowledge. Digital solutions may support quality of life, public services for citizens, better access to jobs, better use of resources, less impact on the environment, and new opportunities for rural value chains in terms of products and improved processes. They also have the potential to contribute to tackling the current depopulation of, and the migration from, rural areas.
A ‘Smart Village’ will be able produce a combined effect of technological achievements such as precision farming; digital platforms offering essential services (e.g. e-learning, e-health, e-administration, transport, gastronomy or social services); shared economy for expensive technical solutions and equipment; circular economy reducing waste and saving resources; bio-based economy; renewable energy; rural tourism and social innovation in rural services and entrepreneurship. The concept of ‘Smart Villages’ relies on a participatory approach, in which not only technology, but also community building and citizens’ involvement is key – along with investments in infrastructure, business development, human capital, capacity and good governance.


It is essential to emphasize the objective of balanced development in the European regions mentioned in the ‘EU Action for Smart Villages’. Rural development should happen on par with the urban one: ‘Smart Villages’ cannot be developed in isolation, they should be embedded in the wider development strategies for regions and territories. Strengthening the links between rural and urban areas, partly by assisting existing rural businesses to connect, integrate and cooperate with urban based business, is also key to achieving the objectives of the ‘Smart Villages’ initiative. Besides, it is important to mention that the concept of ‘Smart Villages’ does not propose a one-size-fits-all solution: It is strategy-led and territorially sensitive, based on the needs and potentials of the respective territory.

1.2 Extending ‘Smart Cities’ to ‘Smart Villages’
Europe has traditionally been an exemplary smart model, investing heavily in human resources, innovation and development. This has continually placed life quality before rapid economic gain and made up for missing natural resources with effective economic and living strategies.

The ‘Smart Cities’ concept is an already well-known and functioning one throughout Europe. A ‘Smart City’ is a place where traditional networks and services are made more efficient with the use of digital and telecommunication technologies for the benefit of its inhabitants and business. A ‘Smart City’ goes beyond the use of information and communication technologies (ICT) for better resource use and less emissions. It encompasses smarter urban transport networks, upgraded water supply, waste disposal facilities and more efficient ways to light and heat buildings. It also means a more interactive and responsive city administration, safer public spaces and meeting the needs of an ageing population.

An initiative supported by the European Commission, the European Innovation Partnership on Smart Cities and Communities (EIP-SCC) aims to improve urban life through more sustainable integrated solutions, bringing together cities, industry, small business (SMEs), banks, research and others. It contributes to the European Union's strategy 'Europe 2020' (see 1.4.3) for smart, sustainable and inclusive growth and it addresses city-specific challenges from different policy areas such as energy, mobility and transport, and ICT. It builds on the engagement of the public, industry and other interest groups to develop innovative solutions and participate in city governance. The priorities of the partnership include sustainable urban mobility; sustainable districts and built environment; integrated infrastructures and processes in energy, ICT and transport; integrated planning and management; policy, regulation and standards; citizen focus; knowledge sharing; open data governance as well as business models, procurement and funding.


In order to add to an already working model in cities, it is a logical consequence to now develop a design for ‘Smart Villages’ – With an in-depth strategy and the suitable technologies to revitalize rural areas. By investing in people and concentrating on the above-mentioned priorities in case of rural areas in the fields of digitization, social innovation and sustainability, energy/environment and transportation, the ‘Smart Villages’ approach could ensure a brighter future for Europe’s rural areas.

1.3 The groundwork of the ‘Smart Villages’ project
In the spirit of ‘a better life in rural areas’, the Cork Declaration 2.0 shared a vision for sustainable development in European rural areas in September 2016. The Declaration puts special emphasis on overcoming the digital divide (see 2.2) between rural and urban areas and developing the potential offered by connectivity and digitization of rural areas. It also underlines the importance of integrated approaches and interaction between different policy fields in view of increasing complementarity and coherence.

 The concept of ‘Smart Villages’ was presented by MEP Tibor Szanyi (S&D) and MEP Franc Bogovič (EPP) via a pilot project in the 2016 EU budget titled ‘special EU Action for smart villages.’ It received the full commitment of the European Commission in 2017, which presented the ‘EU Action for Smart Villages’, a document to launch reflections on villages of the future. A Thematic Group (TG) on ‘Smart Villages’ organized by the European Network for Rural Development (ENRD) was set up to work on the topic between September 2017 and July 2019 as an important part of the ‘EU Action for Smart Villages’. The TG explores ideas and initiatives around revitalizing rural services through digital and social innovation, besides looking at how rural services – such as health, social services, education, energy, transport, retail – can be improved and made more sustainable through the deployment of ICT tools, as well as through community-led actions and projects. The group also acts as a sounding board for developing practical orientations for using all the policy tools available to help ‘Smart Villages’ emerge and develop.

 The scoping exercise carried out by the TG highlights that many rural areas are locked into a ‘circle of decline’ (see figure 1 below) by two mutually reinforcing trends: A shortage of jobs and sustainable business activity, as well as inadequate and declining services. The approaches identified by the TG to help rural areas improve address both.















Another important element of the ‘EU Action for Smart Villages’ is the Pilot Project on Smart eco-social villages. The implementation of the Pilot Project has been granted by the European Commission (DG Agriculture and Rural Development) to the consortium of Ecorys, Origin for Sustainability and R.E.D. in December 2017 and it is expected to be completed until April 2019. Besides mapping the opportunities and challenges in rural areas, the aim of the Pilot Project is to provide a definition of ‘Smart Villages’, describe existing best practices and develop a model for rural communities to kick-start the process of becoming a ‘Smart Village’. A specific emphasis is put on connectivity and digital solutions.

 As part of the groundwork toward getting the idea of ‘Smart Villages’ on the policy map, the European Parliament has allocated €3.3 million for a preparatory action which is scheduled to launch in 2019. Here, the idea is to provide support for the development of up to ten ‘Smart Villages’ throughout the European Union.

 On 13 April 2018, a Conference on ‘Smart Villages’ was held at Lake Bled in Slovenia, leading to the signature of the Bled Declaration. The meeting was supported by three European Commissioners and their Slovenian ministerial counterparts as well as the Slovenian Prime Minister. The declaration highlights how digital technologies should be used to mobilise local assets to solve challenges and seize opportunities in European rural areas.

In May 2018, a second Pilot Project was launched under the name of 'Smart Rural Transport Areas' (SMARTA) on sustainable shared mobility interconnected with public transport in European rural areas. The two-year project aims to understand the current relevance and future potential of on-demand and shared mobility services integrated with public transport in the European rural areas.
On 8 October 2018 in Gödöllő, Hungary hosted a Citizens’ Dialogue with Commissioner Phil Hogan and Tibor Navracsics co-organized by the European Commission and the European Parliament in the framework of a conference about ‘Smart Villages’. The Commissioner shared the stage with MEPs Tibor Szanyi and Franc Bogovič. The discussion focused on the opportunities for the revival of villages and rural areas with the help of cooperation, involving the inhabitants and harnessing new technologies.

1.4 Supporting the ‘Smart Villages’ project
Although ‘Smart Villages’ are fundamentally about rural people taking the initiative, national, regional and local governments can provide an enabling environment for their activity.[3] Several EU policy areas and funds are actively promoting aspects of the development of ‘Smart Villages’. Funding opportunities will continue to exist within the Multiannual Financial Framework (MFF) for the 2021-2027 period.

1.4.1 The Common Agricultural Policy – Rural Development
The Common Agricultural Policy (CAP) is the most significant EU policy supporting rural economy, with measures including direct income support of farmers, market measures and Rural Development Policy. Even though the funding for the CAP for the 2021-2027 period is reduced by 5% due to less contributions with a future union of 27 members, it includes vibrant rural areas among its nine objectives. In order to put focus on the emerging concept of ‘Smart Villages’, a new result indicator was introduced for the CAP strategic plans. The future CAP will both encourage increased investment in research and innovation and enable farmers and rural communities to benefit from it; presenting significant funding possibilities for ‘Smart Villages’ beyond 2020.

 The EU's Rural Development Policy is funded through the European Agricultural Fund for Rural Development (EAFRD) and it provides a range of instruments for supporting the progress of ‘Smart Villages’ in rural areas. Rural Development Programmes (RDPs) target rural economic development, including fostering knowledge transfer and innovation in rural areas; investing in small-scale local infrastructure and connectivity projects; restoring, preserving and enhancing ecosystems related to agriculture and forestry and other bottom-up initiatives. €100 billion from the EU budget has been allocated to a total of 118 RDPs from 2014-2020. The Rural Development Policy shares a number of objectives with other European Structural and Investment Funds (ESIF).


The Rural Development Policy is also home to LEADER, a method for social rural innovation and capacity building; engaging local citizens in the design and delivery of strategies, decision-making and resource allocation for the development of their rural areas. It is co-financed from the EAFRD. In the 2014-2020 programming period the LEADER method has been extended under the broader term Community-Led Local Development (CLLD) to other European Structural and Investment (ESI) Funds, now covering the European Maritime and Fisheries Fund (EMFF), European Regional Development Fund (ERDF) and European Social Fund (ESF). At least 5% of funding for each RDP must be dedicated to LEADER.

As a new element in the Rural Development Policy, the European Innovation Partnership for Agricultural Productivity and Sustainability (EIP-AGRI) has been launched in 2012 to support the European Union's strategy 'Europe 2020'. The EIP-AGRI network is run by the European Commission (DG Agriculture and Rural Development) with the help of the EIP-AGRI Service Point and it is designed to foster competitive and sustainable farming and forestry, and to speed up innovation. It contributes to ensuring a steady supply of food, feed and biomaterials, developing its work in harmony with the essential natural resources on which farming and forestry depend. Different types of available funding sources can help get an agricultural innovation project started in rural areas, such as the Rural Development Policy or the EU's research and innovation program ‘Horizon 2020’. The EIP-AGRI will continue to pool the above-mentioned funding sources to foster competitive and sustainable farming and forestry within the framework of the MFF 2021-2027.

 The European Network for Rural Development (ENRD) is an EU-wide network, bringing together rural development actors in view of improving the quality of RDPs and enhancing participation.[6] ‘Smart Villages’ is the current sub-theme of the broader ENRD thematic work on ‘Smart and Competitive Rural Areas’ (see 1.3). The ENRD’s Thematic Group contributes to the ‘EU Action for Smart Villages’ by exploring how the RDPs, the EU's Cohesion policy and other financing instruments can be best used to support this.[

1.4.2 EU Cohesion Policy
The EU’s Cohesion Policy supporting growth, jobs and sustainable development is implemented across the whole EU territory, both urban and rural areas, with a budget of €352 billion in 2014-2020. A large amount of Cohesion Policy funding is concentrated on less developed European countries and regions in order to help them to catch up and to reduce the economic, social and territorial disparities that still exist in the EU. Cohesion Policy programs and tools are therefore able to foster ‘Smart Villages’.


The financial support of the European Regional Development Fund (ERDF) and the Cohesion Fund (CF) is focused on research and innovation, ICT, SME competitiveness and Low Carbon Economy. These funds also deliver important investment in the fields of environment, climate action and transport. There is a close cooperation with the European Social Fund (ESF), promoting sustainable employment, social inclusion, poverty reduction, education and administrative capacity. Since the main idea of the ‘Smart Villages’ initiative is investing in people and connecting spread out inhabitants, the ESF could help boost the project towards its goals; with a special focus on social innovation and on improving employment and education opportunities.

 Significant investment opportunities exist to foster urban-rural linkages, too. Around €10 billion from the ERDF are allocated directly to integrated strategies for sustainable urban development, required also to consider urban-rural linkages. About 10% relates to entities of less than 20 000 inhabitants. Therefore, small towns and villages play an important role in ERDF support for sustainable urban development. As an example, in order to help close the digital gap between urban and rural areas explained further under section 2.2, around €6 billion have been made available through the EAFRD and the ERDF to finance broadband roll-out and other digital infrastructure in rural areas. This means that several digital aspects of the ‘Smart Villages’ project are already getting attention and could be financed with the help of funds from the EAFRD and the ERDF.

The large number of small towns involved in the implementation of the ERDF generates a further need to invest in administrative capacity building and knowledge exchange. The Urban Development Network is set up especially for this. EU-wide, national and thematic events are organized for cities, with topics such as the development of integrated urban strategies.

1.4.3 ‘Europe 2020’ and ‘Horizon 2020’
‘Europe 2020’ is a 10-year strategy proposed by the European Commission on 3 March 2010 for advancement of the economy of the European Union. Its three mutually reinforcing priorities are smart, sustainable and inclusive growth. The Commission puts forward seven flagship initiatives to catalyze progress under each priority theme:

➢     "Innovation Union" to improve framework conditions and access to finance for research and innovation so as to ensure that innovative ideas can be turned into products and services that create growth and jobs.
➢     "Youth on the move" to enhance the performance of education systems and to facilitate the entry of young people to the labor market.
➢     "A digital agenda for Europe" to speed up the roll-out of high-speed internet and reap the benefits of a digital single market for households and firms.


➢     "Resource efficient Europe" to help decouple economic growth from the use of resources, support the shift towards a low carbon economy, increase the use of renewable energy sources, modernize our transport sector and promote energy efficiency.
➢     "An industrial policy for the globalization era" to improve the business environment, notably for SMEs, and to support the development of a strong and sustainable industrial base able to compete globally.
➢     "An agenda for new skills and jobs" to modernize labor markets and empower people by developing their of skills throughout the lifecycle with a view to increase labor participation and better match labor supply and demand, including through labor mobility.
➢     "European platform against poverty" to ensure social and territorial cohesion such that the benefits of growth and jobs are widely shared and people experiencing poverty and social exclusion are enabled to live in dignity and take an active part in society.

Investing in research and development as well as innovation, in education and in resource efficient technologies will not only benefit traditional sectors and high skill, service economies, but also rural areas. As an example, as part of the ‘Europe 2020’ flagship initiative “A digital agenda for Europe”, the Commission is implementing an "Action Plan for Rural Broadband", aiming to help broadband roll-out in rural and remote areas. The integrated approaches of the EAFRD, the ERDF (see 1.4.2) and the Commission to speed up the roll-out of high-speed internet to deliver sustainable economic and social benefits for ‘Smart Villages’.

‘Horizon 2020’ is the financial instrument implementing the “Innovation Union”, another ‘Europe 2020’ flagship initiative aimed at securing Europe's global competitiveness. Several elements of the 2016-2017 Work Programme of the 8th EU Framework Programme for Research and Innovation, ‘Horizon 2020’, can be relevant for the development of ‘Smart Villages’. Besides the “Transport Work Programme”, a particular call on "rural renaissance" is closely linked to the development of the knowledge base for ‘Smart Villages’. The “Internet of Things”, the “DataBio” and the “Business models for modern rural economies” projects also provide a helpful contribution to the understanding of smart rural areas. As of beyond 2020, a specific budget of €10 billion from the Horizon Europe program will be set aside for research and innovation in food, agriculture, rural development and the bio-economy.

1.4.4 Connecting Europe Facility and Trans-European Networks for Transport
The Connecting Europe Facility (CEF) fund targets infrastructure investment at European level. It supports the development of high performing, sustainable, and efficiently interconnected trans-European networks in the fields of transport, energy and digital services. CEF investments fill the missing links in Europe's energy, transport and digital backbone.


1.4.5 Directorates-General
The Commission is organized into policy departments, known as Directorates-General (DGs), which are responsible for different policy areas. DGs develop, implement and manage EU policy, law, and funding programs. The following is an overview of the relevant DGs that deal with aspects and manage funds related to the ‘Smart Villages’ initiative.

The Directorate-General for Agriculture and Rural Development (DG AGRI) is responsible for EU policy on agriculture and rural development and deals with all aspects of the common agricultural policy (CAP; see 1.4.1). Of the Commission's 10 political priorities, DG AGRI contributes to jobs, growth and investment; digital single market; energy union and climate; EU-US free trade and internal market. The contribution of CAP instruments to the Commission general objectives, as managed by DG AGRI, is presented below (see figure 2):



With regard to the ‘Smart Villages’ project, the DG AGRI runs the relevant European Innovation Partnership for Agricultural Productivity and Sustainability (EIP-AGRI), and has granted the implementation of the Pilot Project on Smart eco-social villages.

The Directorate-General for Regional and Urban Policy (DG REGIO) is responsible for EU policy on regions and cities. Of the Commission's 10 political priorities, DG REGIO contributes to jobs, growth and investment; internal market; digital single market; energy union and climate; economic and monetary union and migration. Considering the ‘Smart Villages’ initiative, DG REGIO could support the economic growth of rural areas through ICT and the introducing of technological achievements such as renewable energy or circular and bio-based economy. It could also foster urban-rural relations and help put the idea of balanced development into effect.


The Directorate-General for Mobility and Transport (DG MOVE) is responsible for EU policy on mobility and transport. Of the Commission's 10 political priorities, DG MOVE contributes to jobs, growth and investment; digital single market; energy union and climate; internal market and migration. DG MOVE could help rural areas achieve significant results in the field of transportation (see 2.5), at the same time supporting innovative projects around the main strands of economic development, environment and energy transition.

The Directorate‑General for Communications Networks, Content and Technology (DG CONNECT) is responsible for digitization to generate smart, sustainable and inclusive growth in Europe. Of the Commission's 10 political priorities, DG CONNECT contributes to jobs, growth and investment and digital single market. With other DGs on its side being responsible for a digital single market, DG CONNECT could improve the digital infrastructure in rural regions in order to foster the economic development of these areas.

The Directorate‑General for Education, Youth, Sport and Culture (DG EAC) is responsible for EU policy on education, culture, youth, languages and sport. Of the Commission's 10 political priorities, DG EAC contributes to jobs, growth and investment and digital single market. The department also supports these policies and priorities through a variety of projects and programs notably Creative Europe, Erasmus+ and Marie Skłodowska-Curie Actions. By expanding these programs to more schools and universities throughout the rural areas of the EU, rural people would be able to join an international cycle of education opportunities and have better chances for finding jobs. Besides, the DG EAC could support innovative solutions in the fields of education, social inclusion and health, culture and services.

The Directorate‑General for Energy is responsible for the EU's energy policy: secure, sustainable, and competitively priced energy for Europe. Of the Commission's 10 political priorities, DG ENER supports jobs, growth and investment and energy union and climate. DG ENER’s contribution to the ‘Smart Villages’ project is needed concerning the implementation of renewable energy as well as bio-based and circular economy.

2. Horizontal results of the ‘Smart Villages’ project

2.1 Rural challenges in need of a solution
Apart from a number of advantages of rural areas – for instance being homogenous and having an established citizen participation –, their communities face several complex difficulties in the fields of digitization, sustainability, energy and environment and transport. 


Originated from challenges in these areas, symptoms of rural decline (see 1.3 – the ‘circle of decline’) such as depopulation and an ageing population appeared; symptoms that have the chance to be cured within the framework of the ‘Smart Villages’ project.

One of the main issues driving the ‘Smart Villages’ agenda is depopulation: Predominantly rural areas account for around 28% of the EU population, while a further 31.6% live in towns and suburbs (intermediate areas), and 40.4% live in cities.[1] There is a seemingly unstoppable worldwide trend towards urbanization and by 2050, the EU population living in cities is expected to grow by 24.1 million, while the population in predominantly rural areas is expected to shrink by 7.9 million.[2] Figure 3 below shows major population loss in rural areas in the east of Europe where significant agricultural (and industrial) restructuring took or is still taking place; in the interior of the southern European countries (particularly Greece, Spain, Portugal and Italy and to a lesser extent the center of France); and in the sparsely populated Nordic and Baltic countries.



Eurostat, Statistics on rural areas in the EU, data from February 2017.

An additional challenge is the ageing population in rural areas. The information shown in figure 4 is based on the old-age dependency ratio, defined as the number of elderly people (aged 65 years and over) compared with the number of people of working age (aged 15-64 years). On 1 January 2017, this ratio stood at 29.9% across the whole of the EU-28; in other words, there were just over three people of working-age for every elderly person. The lowest rate among NUTS level 3 regions on 1 January 2017 was recorded in the French region of Mayotte (4.9%), where there were, on average, slightly more than 20 persons of working-age for each elderly person. At the other end of the ranking, there were 10 regions (nearly all of them predominantly rural) in the EU which recorded an old-age dependency ratio that was higher than 50.0% on 1 January 2017; in other words, where there were fewer than two people of working-age for every elderly person.




Eurostat, Statistics on rural areas in the EU, data from February 2017.

On 1 January 2012, the old-age dependency ratio was 28.2% across the rural regions of the EU-27; this can be compared with a 29.2% ratio for all types of region. The fact that predominantly rural regions had a relatively low old-age dependency ratio, but a relatively high share of persons aged 65 or more in their total population suggests that there was a lower share of young people in the population in predominantly rural regions (15.4%) than across all types of region (21.1%).

Since digital technologies and innovations are expected to improve rural services as well as inhabitants’ lifestyle, they also have the capacity to contribute to reversing the trend of depopulation and ageing in rural areas. The horizontal results of the ‘Smart Villages’ approach in relevant areas are discussed below.

2.2 Digitization
As previously stated (1.3), the Cork 2.0 Declaration put a special emphasis on overcoming the digital divide between urban and rural areas, thereby increasing connectivity between rural and urban areas, other rural areas, and rural peoples within these areas. Expanding the digital capabilities of rural European regions allows for the more integrated approach between policy fields that are called for by Cork 2.0 in order to increase complementarity and coherence.

The sustainable development of rural areas involves the development of one’s own community without jeopardizing its development in the future. Strides must be made to ensure the development of rural areas is able to consistently improve for generations to come, because sacrificing the future for short term development is counterintuitive. Communities in rural Europe must find innovative and efficient ways of utilizing their current strengths and resources if they are to keep up with a world seeing more people going to cities because of a lack of modern services and tactics needed for a more digital and connected world. This requires the development of ICT to efficiently transfer knowledge, experience and good practices between participating rural regions.

 According to the Commission’s ‘Horizon 2020’ Framework, “Information and Communication Technologies underpin innovation and competitiveness across private and public sectors and enable scientific progress in all disciplines. Thus, in H2020, ICT-related topics can be found in all priorities, from 'Excellence Science' to 'Industrial Leadership', to 'Societal Challenges'.” The more communities that are sharing information, the more sustainable the development of these areas can be. Rural areas have a lot of potential which would be better utilized with the connectivity and digitization of rural areas and the policy fields related to rural development.

 This is the heart of the ‘Smart Villages’ project as its aim is to increase the standards of living through introducing better services to community members. It also aims to utilize resources better so that the development of rural areas is sustainable and environmentally friendly. Increasing broadband connectivity among rural areas is the first step, as there is still a serious gap between rural and urban areas: Rural communities suffer from a lack of supply of Next Generation Access (NGA)[ to the internet. According to 2017 figures, only 47% of rural households have access to fast broadband, compared to more than 80% of total EU households (see figure 5 below).




Besides the integrated approaches of the EAFRD, the ERDF and the Commission to finance broadband and other digital infrastructures in rural areas (see 1.4.2 & 1.4.3); the 'Smart Villages' thematic working group helps close the digital divide, focusing on ideas on how to better share knowledge and best practices throughout the continent. Through this, there is hope to resolve issues such as revitalizing local services with digital and social innovations. 

The digital divide in Europe is an issue that most affects those living in mountainous regions. This offers up the challenge of implementing innovative solutions related to good ICT infrastructure in these areas. Doing so would be extraordinarily beneficial to the mountain population and businesses, which would hopefully have similar infrastructure on par with that of lowland and urban areas. Having this infrastructure would allow for small businesses to grow with an online presence, thereby increasing sales and advertising their villages as a place of commerce. Good ICT infrastructure also grows and strengthens the knowledge value chain. This helps businesses to build their own unique competitive advantage because they would have the framework in order to implement research and development. Finding a competitive advantage and being able to communicate this advantage with the rest of the village or region creates an environment in which the community can utilize their skills efficiently. As stated before, ‘Smart Villages’ aims to support movements in rural Europe to build off of their existing skill sets and resources. This would lead to higher levels of social mobility as having low to zero access to broadband increases the risk of poverty or social exclusion.



Next Generation Access (NGA) describes modern forms of superfast broadband access commonly de ned as at least 30 Megabits per second (Mbps). NGA marks a step change in speed and quality of internet access compared to standard broadband services.

In analyzing figure 6, the degree of urbanization can be attributed to utilization of the internet. There is a clear trend in the direction of people living in rural areas presenting the lowest share of individuals utilizing the internet on a daily basis. This pattern was true in 2016 for 25 out of the 28 member states. The only outliers were Belgium, Ireland and Luxembourg, whose rural regions did not report the lowest share of people using the internet daily. This presents further evidence of a challenge that must and should be taken on; not only by the people of these regions, but by policy as well to ensure that rural regions close the digital gap so development in rural regions does not fall behind.

 An example of concrete support for closing the digital divide is the cohesion between Euromontana, the European association of mountain areas, and the European digital forum for ICT in the Mountains, also known as EMICT-Forum.


As Euromontana began putting a heavier focus on the question of ICTs, it started to build its relationship with the Interreg IV B project called CyberSUDOE, which aims to improve competitiveness in the SME sector. Euromontana came in to facilitate the establishment of higher speed broadband in the mountain areas, and made its pledge to do so evident by signing the Manifesto for “High Speed Broadband in Rural Areas”. This consists of the following 10 points:

➢     Digital Infrastructure for European Competitiveness,
➢     High Speed Broadband is an Essential Utility,
➢     Financial instruments,
➢     Public Investment Plays a Vital Role,
➢     Open Access Networks are the Way Forward,
➢     Regulate to Support Equity Between Urban and Rural Areas,
➢     Fibre First,
➢     Manage the Transition from Copper to Fibre,
➢     The Role of Local Authorities Should be Strengthened,
➢     Knowledge Transfer, Piloting and Applied Research.[1]

The digital literacy of residents in rural areas is a crucial factor that hinders the development of rural regions. Digital education is not simply achieved by having access to broadband connection and digital services: It requires a level of knowledge of and competence in operating digital tools and it is reliant on having at least a basic knowledge of a range of topics, such as security, privacy or app usage. Where they are well-designed and operational, 'Smart Villages' are not only looking to bridge the digital divide. If they successfully address all of the challenges they are facing, 'Smart Villages' can support a genuine digital transformation.

2.2.1 Precision Farming
Farming innovations were highlighted at the Agri Innovation Summit 2017 event that took place in October of that year, in Portugal. These startups were created with support from the CAP and the ‘Horizon 2020’ research program. These innovations have mostly focused on precision farming, which looks to produce goods more efficiently and sustainably with the support of technological responses to these challenges. For example, by monitoring crops and analyzing just how to best treat them for higher yields, sustainable farming practices and patterns to be shared across the sector can be promoted. Sensor systems, such as the FIGARO project (details in figure 7), can monitor and analyze agricultural data to improve irrigation management for crops high in water intake. Efficiently using water to irrigate crops is critical for sustainable agricultural development, extending out to affect food security and economic growth. This is incredibly important today with such challenges as climate change, global population growth and the increasing competition for water across multiple sectors of the economy.

Research goes farther than just sensors or satellites. A solution to modern farming challenges is also through digitization, as a higher quantity and variety of quality data about farming is becoming more necessary. To achieve this, the EU funded Foodie, or Farm-Oriented Open Data in Europe. This project developed a cloud-based digital platform for agricultural data in order to facilitate the removal of barriers to precision farming. Project coordinator Miguel Ángel Esbrí said that “FOODIE established an open and interoperable cloud services platform that provides advanced and added value services for different stakeholders in the agriculture domain, with a particular focus on supporting the improvement of a farmer’s daily activities.”

2.3 Social Innovation and Sustainability
Rural areas require national and regional support for ‘Smart Village’ initiatives, but these initiatives also need support from the bottom-up and community-led policies. While cities may get most of the credit for being powerhouses of economic development, rural areas have proven themselves to be quite dynamic and be sources of important innovation.

The Cork 2.0 Declaration mentioned “the rural potential to deliver innovative, inclusive and sustainable solutions for current and future societal challenges such as economic prosperity, food security, climate change, resource management, social inclusion and the integration of migrants should be better recognized.” Projects like SIMRA, Social Innovation in Marginalised Rural Areas, and ECOLISE, European Network for Community-Led Initiatives on Climate Change  and Sustainability, are making clear the fact that thousands of rural areas and villages do have the potential highlighted in the previous Cork 2.0 Declaration excerpt.

 SIMRA, funded by the European Union’s ‘Horizon 2020’ research and innovation program, focuses on marginalized rural areas in the fields of agriculture, forestry and rural development.

Its quest is to advance understanding of social innovation and innovative governance in relation to the mentioned policy fields. Through this, the hope is to boost these marginalized areas both economically and socially. The underlying concept of their efforts is to better understand social innovation’s role in enhancing sustainable development and territorial capital through a framework of social innovation and social innovation governance in rural regions across Europe.

ECOLISE, a coalition of national and international networks of community-led initiatives on climate change and sustainability, aims to increase the positive impact of community-led actions on climate change and sustainability. It hopes to do so through:

Ø  Raising the profile and highlighting the potential of what is already happening across Europe and beyond,
Ø  Sharing and co-creating knowledge and catalyzing effective co-operation among member networks and other stakeholders,
Ø  Influencing European and national policy development and delivery to empower, enable and build upon the benefits of community-led action.

By bringing organizations such as local governments, national and regional networks and other bodies taking part in European-level research, training and communications that support community-led action on sustainability, ECOLISE is pursuing the establishment of a common European agenda. This platform would support collective action towards social innovations and sustainable development.

These projects re-confirm the existence of ‘Smart Villages’ as simply places that create innovative responses to local and global challenges through the population pooling their intelligence and resources. Regardless of the sector being revamped, these actions are an engagement of social innovation (see figure 8) that strengthens the knowledge economy, spurring regional and rural development.




Community-led responses to deep-seated issues are proving to be successful. These issues would be otherwise difficult to attack, such as population decline, unemployment and climate change. When community action is aligned with supportive public policy, this is possible. One of the primary challenges is to create a more favorable enabling environment for ‘Smart Villages’. However, there is a growing concern that policy is falling behind the developments in the field, leading to a growing number of barriers and constraints. There is a disconnect between grassroot responses on the one hand and policy on the other.[1]

Therefore, it is important that policy is in line with the goals of ‘Smart Villages’. The project spans many policy areas, thus there are a multitude of funds such as the CF, ESF and ERDF involved in discussions surrounding ‘Smart Villages’. DG AGRI and other Directorates General play a role in social innovations gaining proper support as well.

2.4 Energy and Environmental
Rural areas provide valuable ecosystem services (e.g. purification of air and water, biodiversity, groundwater recharge, greenhouse gas mitigation) to mitigate and adapt to climate change. ‘Smart Villages’ will be needed to develop new energy sources that meet our climate challenge, innovate in food production for a growing population, and supply natural resources that will enable the next production revolution.[2] Some rural areas are performing well and are in a position to grasp these opportunities. Other rural regions have not been as successful and have less capacity to adapt.

Answering to the climate change, there are now around 3 000 renewable energy cooperatives in Europe active in energy production, grid operations, energy monitoring and saving and e-car sharing. Most of them are concentrated in the north of Europe (the UK, Denmark, the Netherlands, Belgium, Germany, Austria, Finland, Sweden) where the legislative environment is more favorable for individual and decentralized energy production. However, according to REScoop, the European federation of renewable energy cooperatives of 1 250 members, the movement is also growing further in the south (France, Italy, Spain, Portugal) and the east (Czech Republic) of Europe. The number of ecovillages is also growing: The are now around 15 000 of them in six continents, and many villages in different parts of Europe are implementing projects for energy saving, renewable energy production and sustainable transport, as well as promoting local clusters of activity in the circular and bio-economies. One impressive example is the Artic Smart Community Cluster

An ecovillage is an intentional, traditional or urban community that is consciously designed through locally owned participatory processes in all four dimensions of sustainability (social, culture, ecology and economy) to regenerate social and natural environments.




It illustrates how one of the most remote rural areas of Europe (under two inhabitants per square km) is putting into practice a bottom-up strategy for smart specialization. By working closely with entrepreneurs from the villages, the cluster identified huge potential for reducing capital outflow and adding local value in two key fields: energy and food. They developed an integrated strategy to support local entrepreneurs, which includes education in schools, opening up public procurement and building local food and energy hubs. The projects have been shown to create local jobs, cut waste and emissions, reduce costs and keep local income in the local economy.

An ecovillage is an intentional, traditional or urban community that is consciously designed through locally owned participatory processes in all four dimensions of sustainability (social, culture, ecology and economy) to regenerate social and natural environments.

In Catalonia (Spain), 11 Local Action Groups (LAGs) combined strengths in a large cooperation project called ENFOCC, worth half a million euros, to boost energy efficiency. To stimulate awareness of energy consumption, the EneGest software was developed, which allows small enterprises to monitor energy use. EneGest is shared with 100 SMEs, 11 public schools and 47 town halls that received advice regarding energy management. Savings of €250000 have been reported. The savings are being reinvested in further measures to save even more energy. In 2018, the project developed an innovative model that calculates the costs of energy transition by using a simple survey. The model provides data about the investment needed, the current economic savings as well as future and accumulated costs, and the energy needs of a municipality or a region to become energy self-sufficient. In addition, the project assessed the spread of electric vehicles in rural municipalities by studying options for installing charging points in rural areas.

As another successful example stand the bioenergy villages in the rural area of Göttingen, Germany (see figure 10 below). The Göttinger Land LAG put an integrated bioenergy model in place with the LEADER implementation, involving 34 municipalities. Five villages decided to go ahead with the project and are now operational.


The project connects local farmers to village cooperatives which manage energy production and distribution. Initial funding comes from three main sources: the local community; LEADER, and the federal government. The business model for each village involves a €2.5 million investment for design and creation of a joint biogas plant and a woodchip furnace, both connected to a common heat grid. LEADER is investing around €200000 in each village to carry out certain functions (project design and planning, in particular) in combination with other funds to bring together farmers and other villagers in a sustainable cooperative project for renewable energy.

The project attracted high levels of local citizen participation and provides important social, economic and environmental benefits for the relevant rural areas.


2.5 Transport
The DG MOVE aims to promote a platform of mobility that is efficient and environmentally friendly. In urban areas, this is a relatively simple agenda as there is enough demand to be able to establish frameworks for efficient transport that do can be constant; they do not need to worry about a sudden drop in demand. In rural areas however, the demand is not constant, so a supply is needed that must be able to adapt to sudden spikes or dips in demand for transport. This would be supported by the previous horizontals that involve social innovations and initiatives using ICT frameworks, based in good broadband connection, to create an efficient and environmentally sustainable system of transport.

Rural development not only involves the development of rural areas independently, but also establishing connections between each other and neighboring urban areas to offset the trend of people moving away from rural areas. Offering an efficient network of transport would incentivize living in rural areas instead of moving closer to cities. This allows members of rural communities to gain access to services they may not have in their home village. For example, elderly people and people with disabilities may find it especially difficult to get to their required services. This is why niche Intelligent Transport Services (ITS) would play a huge role in rural areas. The global trend of leaving the rural areas for the cities and suburbs can be slowed down if those in rural areas could be connected to local services in a low-cost and efficient manner.

One successful example of such a service is the Bwcabus (book-a-bus) program in rural Wales, an on-demand service that tailors to the needs of rural passengers. While an established, fixed route transit system would not fit into the rural lifestyle, a strategic bus route transit service would be able to adapt to the more tailored needs of the rural European community. Making local transport accessible is a key issue for areas trying to overcome the barrier of isolation; less access to other villages and larger transport networks. Bwcabus involves pre-booking over the phone, which helps improve accessibility, reduces dependence on automobiles and assists in lifting rural communities out of deprivation of services. Strategic bus routes focus on the passenger, which is more sustainable and fights back against the trend of uncompetitive bus companies being cut in order to save money. While funding of the project from the ERDF began in 2008, it was able to secure EAFRD funds in 2015 (see figure 11). The initiative was community driven, led by Carmarthenshire County Council in partnership with Ceredigion County Council, Traveline Cymry and the University of South Wales.


The service is offered through a website to provide users with details on times, locations and prices, so having a digital broadband framework is necessary. Once users register at no cost, they can book over the phone to travel between villages in the Bwcabus area and connect to larger transit systems. The following is a collection of reviews of the system:
·       Melanie Heath, Bwcabus’s longest serving passenger: “Without Bwcabus I would no longer be able to keep my current job as I have no other means of transport and a taxi would prove too expensive.”
·       Mary Jennings, Bwcabus service user: “This is a wonderful service and I don’t know what I would do without it! Healthcare is an issue to me right now and access to appointments is very important. Before Bwcabus it was extremely difficult as we only had a bus once a week.”

The movement of people in these rural areas is a boost to the local economy and SMEs as it brings in workers and customers. Councilor Hazel Evans, Carmarthenshire Executive Board Member for Transport had this to say about it:
·       "Bwcabus has proven that [it] can increase the frequency of public transport use, improve accessibility, encourage a reduction in car use, and assist in lifting rural communities out of deprivation… I am delighted to hear that businesses in rural areas are also benefiting from the service."

 The FLIPPER project, Flexible Transport Services and ICT Platform for Eco-Mobility (figure 12), helps regions of Europe to work together in sharing experiences and practices in innovation, knowledge economy, environment and risk prevention areas. As previously stated, fixed transport doesn’t fit rural life like it does with urban life, so establishing FTS (Flexible Transport Services) would be advantageous to rural communities and their development. The challenge would be the integration of FTS into the established fixed transport systems, requiring cooperation with the digitization horizontal. This could be managed by a unique coordination center supported by an ICT platform. FLIPPER is trying to achieve an increase of mobility, a decrease in the use and necessity of private cars, the provision of a local distributor to conventional transport and the establishment of cost-effective commuting possibilities for both the employed and job seekers.



The project’s main aim is to ensure that the partnership between various transport services (flexible local bus routes, special customer transport, community transport, ride sharing, etc.) will guarantee the transfer of FTS know-how and the concept of an ‘ICT platform’ in EU areas. This will help identify the best practices in the implementation of these services and systems.

3. Outlook
For many people, rural areas are simply home – a place to live, work and raise families. Many people, on the other hand, are leaving rural areas on account of the lack of services and opportunities. Rural communities need jobs, basic services, connectivity and smart transport solutions, as well as a favorable climate for entrepreneurship. This means intervening on all these fronts in an integrated way; adding to an already working ‘Smart City’ model with a suitable strategy, resources and technologies to revitalize rural areas. The 'EU Action for Smart Villages' is already signaling the way forward by bringing together the European Commission’s Directorates for Agriculture and Rural Development, Regional and Urban Policy, and Mobility and Transport. In order to address challenges in the fields of environment and energy; education; social inclusion and health, culture and services; the involvement of the Directorates for Communications Networks, Content and Technology; for Education, Youth, Sport and Culture and for Energy is also a reasonable step forward.

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Financing opportunities of aspects of the ‘Smart Villages’ concept exist within the framework of the MFF 2014-2020. Relevant funding policies include the CAP (with its Rural Development Policy, funded through the EAFRD) and the Cohesion Policy (pooling the three main funds ERDF, CF and ESF). The involvement of funds like the EMFF, the Horizon Europe program and the CEF can also be meaningful. The funding for the CAP for the 2021-2027 period is moderately reduced as a result of the Brexit (and less contributions due to a future union of 27 members) – This also means that as of beyond 2020, the rural areas of the United Kingdom would not be involved in the EU’s ‘Smart Villages’ initiative.

Despite the reduction of the funding for the CAP, funding sources will continue to exist beyond 2020 both within the CAP as well as the Horizon Europe program. A specific budget of €10 billion from the Horizon Europe program will be set aside for research and innovation in food, agriculture, rural development and the bio-economy; and the EIP-AGRI will also continue to pool funding sources from Horizon Europe and rural development to foster competitive and sustainable farming and forestry.

As the 'EU Action for Smart Villages' says, to ensure the sustainability of ‘Smart Village’ initiatives, powerful strategic approaches and integrated solutions are needed. For policy-makers, stakeholders and project promoters on the ground to deliver the best results, planning needs to pay attention to the needs and comparative strengths and weaknesses of respective territories. In this context, the RDPs can act as the seed money empowering local people, mobilizing assets, levering in further investments and creating the conditions for building the ‘Smart Villages’ of the future. By strategically combining RDP measures with one another as well as with other EU, national or private funds; a synergy effect can be achieved on improving rural services and inhabitants’ lifestyle – Be it in the field of digitization, social innovations and sustainability, environment and energy, education, health, culture or transport.

Besides the integrated approaches and less funding due to the Brexit, the future of the ‘Smart Villages’ project depends on another current political happening: The May 2019 European elections have a direct impact on the initiative, as they will decide how Europe will act in the coming years to address rural issues such as depopulation, poverty, aging and the lack of services and infrastructure. MEPs will be needed who share the vision of the Cork Declaration 2.0 and are ready to invest in rural people and businesses, in order to revitalize their services and boost their quality of life.



List of references

47 Eurostat, Statistics on rural areas in the EU
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