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Economic competitiveness

[ Summary ]


Chapter 3:
Implementing a strategy to boost economic competitiveness


The economic competitiveness of the business firms in a rural area is a prerequisite for the area’s economic competitiveness, but is not sufficient in itself.


3.1 From corporate economic competitiveness to territorial economic competitiveness


The most common approach is to view economic competitiveness from the corporate angle. Furthermore, there are numerous proven ways and means for developing and implementing strategies to enable business firms to acquire economic competitiveness.

However, the search for territorial economic competitiveness goes much further than this. The table at the end of the previous chapter illustrates the differences and complementarities between the two sides of the economic competitiveness concept.

The economic competitiveness of the enterprises in a rural area is therefore a prerequisite for the area’s economic competitiveness, but it is not sufficient in itself. Other elements also need to be taken into account. Below are a few examples:

  • integrating all of an area’s resources;
  • promoting an area’s common distinctive features in order to differentiate products and create market opportunities;
  • strengthening corporate ties to an area in order to increase non-relocateable resources.

a) Integrating every one of an area’s resources into a development strategy

    In a differentiated territorial approach, all of an area’s components become potential “resources”. Intervention strategies can be developed to:

    • prevent business activities from being concentrated on limited resources and sites;

    • promote the environment (preservation of natural resources) and the identities fostered by social traditions and allegiances;

    • create “variable geometry” partnerships to encourage the emergence of new ideas and new products.


      The Isle of Lewis (Scotland) has an abundance of environmental resources and a rich cultural heritage. The druid stones of Calanais represent one of Scotland’s finest examples of late Neolithic architecture. The site was developed after more than two years of consultations. The 11 organisations and interest groups involved in the project each had their own views on the way in which the site ought to be developed. However, one thing they all shared was the desire to find a solution for managing the site to enable the region to draw benefits from tourism. The Western Isles LEADER group played the role of catalyst in setting up the forms of cooperation needed to achieve concerted action from the various players involved. A limited liability company was created to manage a cultural heritage centre and tourist information point. Its board of directors is comprised of representatives from the chief financial partners and the local community.

b) Promoting an area’s distinctive features in order to differentiate products and create market opportunities

    Traditions, landscapes, architecture and know-how can all become elements that differentiate an area’s products. Emphasising an area’s “shared assets” also means fostering the emergence of the collective-innovation concept and practices.

    This approach can also be effective in encouraging the ability to create and develop links between the area and the test centres seeking solutions to match the area’s resources to consumer demands and quality requirements.

    So, promoting an area’s distinctive features becomes a key element of a bottom-up development strategy in which the knowledge and culture of the area’s entrepreneurs leads to proposals for change and revival.

c) Strengthening corporate ties to an area in order to increase non-relocateable local resources

    How can an area hold onto its business firms and secure a certain competitive advantage once it has promoted its distinctive features?

    By what means can it ensure that business firms and activities become non-relocateable? Two parallel approaches may be required:

    • raising local players’ awareness about and acknowledgement of the special features of their area and culture that may interest consumers;

    • fostering the ability to renew, update and continually adapt products and services because, whatever the type of activity or product, no matter how distinctive, staying in the market calls for a constant quality effort.


      In the Vinschgau/Val Venosta LEADER area (Trentino-Alto-Adige, Italy), hotelkeepers are not content to merely preserve their area’s special aesthetic and other traditional features (this Italian area is mostly German-speaking), but they also update the region’s gastronomic offering. For example, they adapt traditional recipes to suit vegetarians or cook with local organic produce.

    Most LEADER groups use a range of means (regional labels and quality charters, thematic routes, tourist trails, visitors’ centres, etc.) to reinforce the non-relocateable elements of an area’s business activities, by involving the local community and entrepreneurs.

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