Business Irish

Saturday 21 April 2018

We break the mould with most 'rural' economy in Europe

Donal O'Donovan

Donal O'Donovan

IRELAND is the most 'rural' economy in Europe, according to a new study that highlights the extent to which higher economic output is explicitly linked to urbanisation.

A new Europe-wide geographic study shows that Ireland's urban/rural split is the most extreme anywhere across the continent.

Nowhere else in Europe is so overwhelmingly rural, according to the report from the European statistics agency Eurostat.

This matters because the report highlights the huge divergence in economic output between urban and rural areas.

In the case of Ireland that is not just a question of development around industry, it also works the other way.

Investment by multi- nationals is running at a high but new jobs tend to be focused on a zone of investment within an hour's drive, or less, of Dublin.

The rapid growth of new IT hubs in the centre of Dublin that are now home to the likes of Facebook and Google is also a case in point.

The concentration of investment in areas where urbanisation is already at a critical mass means rural areas risk slipping further behind, especially as investment in physical infrastructure such as roads, rail and airports is focused on addressing bottlenecks created by growth.

In our case the only major road projects announced this year – on the N11 and N7 – are both aimed at easing access in and out of Dublin.

A major expansion of the Luas system is also under way, aimed at coping with Dublin's increasingly congested city centre.

The findings are based on a huge study that sliced Europe into a vast grid of 1km-square units, each classed as 'urban', 'intermediate' and 'rural'.

In the case of Ireland, those tiny squares add up to eight major regions classed along the same lines.

Seven of the eight regions are classed as rural – meaning that more than 50pc of the population lives in a rural district.

Only the greater Dublin area meets the European classification of "urban".

Across Europe, towns and cities account for 42.4pc of the total population, intermediate regions 35.3pc and rural districts just 22.3pc.

In Ireland just 27.6pc of people live in an urbanised region but they produce around 40pc of the economy's "gross value added" (GVA) – the market value of products produced less the cost of inputs.

Across Europe as a whole more than half of all such "value-added" wealth is generated in urban areas and so-called intermediate regions account for a significant share of the rest.

Irish Independent

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