Rural industries create job and income opportunities based on local natural resources. These industries are very important to revitalizing the rural economy, but there are limitations to efficiently and comprehensively carrying out related policies because government roles and duties overlap among various ministries. Therefore, it is necessary to integrate and revise related laws to comprehensively carry out the policies. For this reason, this study aims to lay down a legal basis needed to develop rural industries. The current state of rural industries is examined to reflect new trends, and limitations and mechanisms of existing related laws are analyzed to refine the legal system needed to develop rural industries.
A rural industry can be conceptualized as being a rural-based industry that takes advantage of local resources and that embraces the concept of convergence among the primary (agriculture), secondary (manufacturing), and tertiary (service) industries.
This study examined the current rules governing the development of rural industries on an individual industry basis. In addition, targeted beneficiaries of government support for rural industry development projects and their contents are reviewed in the following seven project fields: infrastructure development, agriculture, food, horticulture, livestock farming, fisheries, and resource development for rural tourism.
Based on this review, limitations to providing rural industry support under the current laws are derived. First, although a rural industry that integrates agriculture with manufacturing and service industries can be viewed as having a new industrial structure, it is difficult to flexibly respond to the demand for forming ties and promoting cooperation among the industries because the current legal system regards each industry (i.e., agriculture, manufacturing, and service industry like tourism) as a separate target of policy implementation. Second, human resource development and intermediate support organizations that can support and revitalize convergence activities are lacking and the legal basis that can provide institutional support, too, is insufficient. Third, a rural industry has a strong characteristic of being a regional industry, thus it is necessary to have rural industry policies at each administrative level (i.e., village, city-county, and city-province levels) and yet there is no legal basis to support it.
This study analyzed the support system and basic framework of 13 laws, such as the Industrial Technology Innovation Promotion Act, the Industry Convergence Promotion Act, and the Industrial Technology Research Association Promotion Act, that are legislated to promote domestic industries. In addition, in order to examine the Japanese cases of promoting rural industries, this study analyzed the legal framework of the 'Law for Promoting Business Activity through Collaboration Between SMEs and Agriculture, Forestry and Fishery,' which is the legal basis for collaboration among agriculture, manufacturing and service industry, and the 'Act on the Creation of New Businesses by Farmers and Fishermen Utilizing Local Resources and Promotion of Utilization of Local Agricultural and Marine Products,' which is often referred to as the Law on Sixth Industrialization.
In order to collect opinions on legislating a law that aims to foster the development of rural industries, a survey was conducted among experts, and the survey results showed that there is a consensus on the need to legislate such a law. 95.1% of respondents said that it is necessary to have an independent law like the Rural Industries Promotion Act (tentative name) to revitalize rural industries. As for measures that need to be taken to support project participants and companies, the survey showed that there is a significant need for expanding sales network and markets (28.2%) and business incubation and consulting (27.2%).
The basic directions for legislating the Rural Industries Promotion Act are suggested as the following. First, the basic ideology should be set on maintaining and developing rural society and communities. Second, the legal concept of rural industry should be built to conform to the special law. Third, a basic plan, as well as an action plan, should be set up to systematically foster rural industries. Fourth, a legal foundation to revitalize intermediate support organizations should be laid down. Fifth, a legal basis to foster rural industries should be laid down. Sixth, industry conversion and win-win cooperation should be strengthened in rural areas.

Researchers: Yong-Lyoul Kim, Myung-Un Jeong, and Ja-Hye Min
Research period: 2013. 5. - 2013. 8.
E-mail address: kimyl@krei.re.kr