Smart Village: a concept to support rural areas development with digital technologies 

Rural areas represent most of Europe's territory (~91%) and population (~59%), but when measuring against socioeconomic indicators, they tend to lag behind urban areas. Lower population and business density make it more challenging to develop private businesses. However, rural areas are key to solve many of the big societal challenges such as climate change or the sustainable provision of food, biomass, and energy. European rural areas are places of great assets and they can become more attractive if the provision of jobs, as well as a favourable climate for entrepreneurship, are ensured. Digital technologies have the potential to revolutionise the rural sector by helping people work more precisely, efficiently and sustainably and adapt their life while preserving culture, religion and social life. The smart village concept represents the way that people / rural communities take the initiative to find practical solutions to challenges they face and make the most of the new opportunities. Digital solutions power many such new opportunities (i.e., in the field of e-health, online education, mobility, local energy production), but “smart” also implies cooperation and developing of new alliances (i.e. between farmers and other rural actors; between small municipalities; the private sector and civil society) and find a path to prosperity and sustainability.  

Let’s consider food waste, as enabler of new digital business opportunities for smart villages. Throughout Europe, food is closely linked to cultural heritage and lifestyle: the value of food is not only connected to nutrition, but also to skills, knowledge and traditions which belong to a community identity cultivated throughout the years. But our current system of food production and consumption poses challenges affecting different domains, including heath (evidence of consumption of ultra-processed foods, non-transmissible diseases, etc.), sustainability (excessive levels of food waste, abandonment of local products, loss of local biodiversity, carbon footprint of importing fats from faraway countries), energy (relying heavily on carbon-based fossil power generation and fuels) and engagement of local economic actors. Evidence shows that 88 million tonnes of food waste are generated annually in the EU, with associated costs estimated at 143 billion euros. The highest percentage of food waste is generated among households (53%), then processing (19%), and the rest spread across the food value chain: primary level production 11%, food service 12% and wholesale/retail trade 5%. And this creates new business opportunities for local rural businesses, focusing on the use of by-products for example. 

EU agri-food and Common Agricultural Policy (CAP) put a particular emphasis on food waste.  Evidence shows that more by-products, value chains in sectors such as environmental engineering, sustainable packaging, and clean energy, are to be developed in the future. The more cross-sectoral value chains interact with each other, the newer products and services will either re-entry in main value chain or generate new ones, supplying the market with new products. Therefore, it is likely that valorisation of rest raw materials will impact on food value chains but also closely related sectors such as environment, energy, packaging, automation and ICT among others.

The integration among emerging industries occurs among Food supply chain and Food and inedible parts removed from the supply chain boxes. The food supply chain will become a complex series of inter-related markets with increasing forms of coordination, integration and contracts. And the implementing of such circular economy principles across the EU economy is expected to increase EU GDP by 0.5% by 2030, creating around 700,000 new jobs especially in rural areas. SMEs active in the agro-food sector in particular stand to gain a lot from this transition to circularity. From a circular economy standpoint, the main standards and studies are currently focused on recycling and end-of-life - after products are discarded by users and consumers - but show very low re-utilization rates of side streams originating from production and transformation processes, including attainments in bringing to market sustainable packaging.