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Local financing in rural areas

[ Summary ]

 

Chapter 4:
Challenges for the future

 



4.3 Financing formulas as yet unexplored
by LEADER

 

First and foremost this involves the LEADER groups’ role in the coordination, promotion and local consolidation of ethical and mutual aid financing.

In the Communication from the European Commission “Building an inclusive Europe” [35], the LEADER Initiative was cited as one of the Union’s instruments for actively promoting social integration. LEADER+ groups are invited to play an increasingly active role in supporting and assisting the emergence of collective mutual aid alternatives in rural areas, particularly the areas hardest hit by unemployment.

The territorial coordination approach taken by LEADER groups could be extended to such fields as access to credit, the creation of local ethical and mutual aid alternatives and access to nationally developed alternative formulas.

Practices that exist elsewhere, either in the same country or abroad, may inspire local approaches for:

  • opening up access to finance for all project promoters;

  • developing (in partnership with certain banks and appropriate financial structures) products that match the needs of the area concerned;

  • setting up the consulting and knowledge transfer mechanisms required to enhance the management and financial autonomy of vulnerable groups;

  • creating and developing the ability to build projects of public interest that can be financed by ethical and mutual aid financing mechanisms;

  • bringing to the attention of the regional authorities the need to recognize the function of mutual aid financial structures (and of any mechanism that facilitates access to credit for the unemployed, young project promoters, etc.).

By integrating these aspects into the territorial coordination approaches already developed by LEADER groups, the groups will be able to further assert their role as “local development catalysts”. Nonetheless, many rural areas simply do not have enough inhabitants to make local financial structures viable. The cooperation agreements opened up under LEADER+, aimed at securing an appropriate scale of funding, should make it possible to overcome the handicaps so common to rural areas due to their lack of critical mass.

 


[35] Commission of the European Communities,
COM(2000)79 final, op. cit. p. 10



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European
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Agriculture
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