FROM BREAD TO BRAIN, FROM WISDOM TO KNOWLEDGE The case study of Alentejo Region

1. Session 3: Improved regions for businesses and citizensThursday 8 March 2007 | 15.00-17.00 | Charlemagne Building Workshop 3C Bringing economic diversification to rural areas FROM BREAD TO BRAIN, FROM WISDOM TO KNOWLEDGEThe case study of Alentejo Region Fernando Teigão dos Santos | fernandots@isa.utl.pt

2. 1 The issue • THE CHALLENGES OF THE WORKSHOP • How to bring economic diversification to rural areas? • How to foster regional competitiveness? • What can we share and learn from the diversity of European experiences? • THE CONTEXT OF REGIONAL DEVELOPMENT • Global competitiveness increasing • Empowerment of the Regions • Rural areas looking for new attitudes and strategies • 2007-2013 context of EU policies and instruments • THE CASE STUDY OF ALENTEJO REGION • A Region in transition from “bread to brain” • A Region with lessons to share

3. 2 The Region Alentejo • THE TERRITORY • Region in the South of Portugal | Area 27.324 Km2(1/3 of the Portuguese mainland) • Divided in 4 NUTS3 + 1NUTS3 (included for statistical and financial purposes). • 47 Municipalities (30 Mun. < 10.000hab. | 5 Mun. betwen 20.000hab-40.000hab | 1 Mun. 56.000) • Connected to 5 Regions (Algarve, Lisbon, Centro and also to the Spanish Regions of Etremadura and Andalusia - with a borderline of 350Km). • Population 550.000 (around 6% Portuguese pop.) • Portuguese Region with the lowest population density (19,6 Hab/Km2)

4. 3 The Region Alentejo • THE ECONOMY AND THE ACTIVITY SECTORS • Convergence Region | 65% GDP per head of the EU25. • Positive trends in indicators related to cohesion but worse performance on indicators associated to competitiveness. • Deficit in human capital where the majority of the population has low educational levels (around 50% of population just with first basic cycle of education and only 6% of the resident population presents higher education). • Low-tech region, with low levels of R&D in terms of investment and human resources. • 88% of micro-enterprises (national average of 82,7% in 2001). • Co-existence of activity branches of very low productivity (traditional agriculture, retail commerce) with branches of higher productivity (industrial complex of Sines, modernized agriculture, agro-industries). • Large investment projects that are emerging and changing some faces of the region. • A clear vision and a well defined matrix of the regional key-sectors. • Agro-food • Wine • Cork • Ornamental stones • Tourism • Emergent activities – Energy, ICT, aeronautics

5. 4 The Wine Sector THE SUCCESS STORY OF ALENTEJO WINE Alentejo wine areas represents just 8,6% of the Portuguese wine area and 9% of wine production(6th position in terms of demarked wine regions), but it is the market leader of quality wines in terms of selling's with a share of 46% of the national market (1st position) and with a strong potential of growth (CCDR Alentejo, 2005). Successful evolution laying on several factors:Capacity building inside the sector; Key-stakeholders acting as catalysers (publ.administration; producer’s associations; universities and R&D centres; private foundations);Investment in product/processes improvement (research, modernization, knowledge dissemination); Building of a strong and visible Wine Region; Creation of a powerful brand; Better levels of human capital; Political support; Some innovation; Active complementarities with other sectors (tourism; gastronomy; wine routes); Importance of external investors / entrepreneurs (wine sector as a fashion-sector highly attractive); Efforts from quality, to quantity, to diversity; Attitude, ambition and adaptability in the face of the growing competitiveness in the global sector and in face of the emerging new markets; etc. Slogan “More than Knowledge: Wisdom” showing a change of paradigm In the past, the success for the quality of the wine was seen more from the perspective of the characteristics of land, the climate and the grapes. Today, however, the success is more on the qualified knowledge, the accurate techniques, laboratories, marketing and branding, and so forth, and thus complementing traditional wisdom. In fact, “’More than Wisdom, is Knowledge”!

6. 5 OLIVE OIL SECTOR Growing, learning and going Other major activities and products CORK SECTOR Sustainability, innovation and diversification ? TOURISM SECTOR Breathing, booming and building ORNAMENTAL STONES SECTOR Staying on the rocks Different sectors, different trends, different evolutions, different responses…

7. 6 Drawing lessons 1. THE ENTREPRENEUR RURAL REGION The Region as a network of stakeholders sharing a vision, goals and resources, building the future on regional advantages. Clarification, specialization and diversification. Rural areas taking advantages of space, time, identity, scale and proximity to foster competitiveness of key sectors (eg. agro-industries, tourism, energy). Importance of entrepreneurial attitude in “bridging together” different sectors.

8. 7 Drawing lessons 2. YINNOVATING PRODUCTS Yin and yang, old and new products, tradition and technology, the search for balance in innovation. Wine, charm and entrepreneurship linked in successful partnerships. Double promotion effect Wine-Region based on identity and brand. Transitions in traditional sectors can bring new opportunities for diversification, for access to new processes, for rethinking organization and business practices.

9. 8 Drawing lessons 3. POLICIES OF ACTIVE PERFORMANCE EU regional policy from cohesion to competitiveness, from “support” to “speed”. Learning from good practices can help but in many cases lessons are not transferable without institutional thickness and efficient capacity building. Policies, instruments and funds should be catalysers of adaptability and change, helping to break old routines and lock-ins, raising the performance of key regional sectors. Importance of adequate frameworks to foster “rural active development” going beyond the reduction of the “traditional” barriers (infrastructures, connectivity, human and social capital, ICT, etc.).

10. Session 3: Improved regions for businesses and citizensThursday 8 March 2007 | 15.00-17.00 | Charlemagne Building Workshop 3C Bringing economic diversification to rural areas FROM BREAD TO BRAIN, FROM WISDOM TO KNOWLEDGEThe case study of Alentejo Region Fernando Teigão dos Santos | fernandots@isa.utl.pt