Eszterházy Károly College Faculty of Natural Sciences
The chapter, titled Local resource and product path management aims at the methodological promotion of the local utilization of local resources, by making the configuration and development of the local added value –chain. The formation of the product path model serves both social and economic purposes. It provides an opportunity for manufacturers to produce product with high-added –value through their traditional expertise and to sale those products on regional markets.
Most products have get out of the scope of agricultural or food producing craft items, but raw materials and equipments which are connected to energy production also have been valorised better and better. The basic objective is to retain the hereby produced profit in the region in order to serve the local inhabitants’ existence.
Product path put -the involving of local entrepreneurs to partnership relations and the development of enterprises- to the forefront. “Product path is the system of such relationships which is realized among businesses those are involved in the procurement and sale processes of the products and services.” (ERNYEI-NAGY 1999)
The significance of this has key importance in retaining the population, in sustaining an improving the quality of life, moreover in the same way in conformity with environment protection conditions. Local product path follows the principles of humane fallow land in resource consumption, which meets the criteria of sustainable development. The intention, that- local resources which most of all characterize the given geographical sphere together with traditional local products of high quality which may open ways towards a certain degree of self-sufficiency should be involved in details in the planning documents of settlement and region development - could be selected as an additional objective.
Raw material, infrastructure which is necessary to production, human capital, circulating capital, sales channel, partner network, marketing and management activities are all included in product path formation. The LEADER, which composes the fourth, overall axis of the Agriculture Policy of the European Union gives assistance in its complex process. The peculiarity of this program is the support of local initiations which initiations focus on rural economy improvement, most of all focusing the high level improvement local products’ quality.
This initiation eventually is not only directed at enlarging the sale of the local products but in addition to that, it involves the partnership cooperation of small farmers’ access to the market.
This latest objection has been given more and more emphasize these days, since in the case of most of the projects, stabile and profitable business activity is the major criterion of the wider market access of the local products. The LEADER means a major step forward in rural development compared to the traditional support system, since it takes local communities and local resources as the basis of improvement (endogenetic), and it regulates entirely freely about the modes of utilization. Due to the displacement of the decision making level to lower levels of vertical type, local and regional interest are getting closer and closer to the objective system that has been created by the European Union. (RAY 1999)
The chapter titled Local resource and product path management has been made by investigating the whole production chain. Local products possess special geographical peculiarities and their production usually happens in small scales, by locally available resources expenditure. The claim of developing alternative, low –input requiring and environment-friendly economical systems prevails more and more dominantly in rural economy. (BÍRÓ-FEHÉR 2005). Not the question is only the following: which are those resources upon which we could rely in the course of rural development and which of those resources could be exploited efficiently? It is such a complex question and for the proper answer, a comprehensive and proper –depth knowledge about a given landscape /region together with the dept-knowledge about its actual social-economic relations is necessary first of all.
The discussion of the foregoing issues is reasonable to start with the consideration of underground resources (mine property, geothermal stocks, water base), what are the funds of the prosperity of regional economy, as well as they provide obvious opportunities for creating self-sufficiency. ( PÁPAY 2003, HAHN et. al. 1998)
Beside the elements of mine property, the local features of earth’ heat also belong here. (DÖVÉNYI 2008, HALÁSZ et .al. 2009, KOZÁK,MIKÓ 2003).
The cognition of underground and above the surface resources has great importance fundamentally due to agriculture and energy production. The excavation of the soil potential and the industrial crops and herb herbs which characterize the region, together with the esteem of productivity are outstanding tasks in the course of situation-revealing. (FÜLEKI 2008, KARÁCSONYI 2010).
Designing that is based on local resources is -labour, money- and time consuming, which have already occurred during the measurement of landscape geographical capabilities. Several definitions exist for defining the local product conception both in special literature and in common use. However a number of authors have tried to make a clarification about the meaning of this up to this day elusive conception, but exact reference points which are decomposed to product range are still missing. The local product denomination is basically a qualitative category, too, where the duplex of uniqueness and high quality is a condition system of prime importance combining with the elements of sustainability. In the present case this means landscape protection, suitable animal welfare measurements, as well as the traditional availability of the production sites /vegetative place with special gifts or primary commodities with divergent individual features.The next step is the great tradition competence of the processing procedure, the micro or small ventures with craft character, just as the production to internal or external markets. (G. Fekete, 2009, TREGEAR et al. 2007)
The activity that may be connected to product path, but basically is a service-based activity, is the renewal-energy source based energy supply.
In Hungary, the utilization of renewal energy sources is at very low levels compared to the opportunities. Primarily those raw materials have to be applied which are locally available, generally within 30 kilometres zone, and the exploitation of which is both economical and environment- friendly .Qualitative and sustainable developmental strategy could primarily be built upon these domestic stocks of primary commodities. Our country has excellent features in terms of geothermal energy, but most of all from heat pumped and auxiliary medium utilization aspects. The value of the geothermal gradient is about 1°C by 20 metres going down. This heat could be utilized in many ways as a source of energy.
Geothermal heat could be used directly in district heating systems, and besides it is appropriate for electricity production, moreover its waste heat allows crops production that is available in the greenhouse system. The demand for alternative, environmental- friendly, and of low input requiring economic systems identifies more and more in agriculture. (BÍRÓ,FEHÉR 2005)The objective is the visualization of the specific, geographically –connected features by the products and that the consumption of that products has to be happened simultaneously with the consumption of other local products or services, and the marketing annuity have to reach even wider circles.
The 19,6 million enterprises of the European union employ 126,7 million employees, and their decisive majority does not mean large companies. The 99,8 percentage of all of the enterprises those operate in the European Union – similarly to the past years and to Hungarian proportions- consists of medium and small businesses. According to Antonio Tajani, the vice-president and the industry and venture political commissioner of the European Committee the sector of small and medium ventures” means the engine of our economy, which has to be strong, competitive and innovative” In Hungary this sector is the major employer, the 71,7 percentages of all employees work at micro, small or medium enterprises, this proportion is 4,8 percent larger than in other 27 member states of the European Union. . (SBA Fact Sheet Hungary 2010/2011)
This sector was able to gain remarkable employment enlargement over the past 10 year, unlike large businesses It is important to point out that the two-thirds of Hungarian small and medium businesses produce for imports, therefore the decisive majority of the production profit remain in Hungary. The all-time Hungarian government unfortunately has noticed their decisive role with a relevant phase delay, thuswise a competitive increasing program for small and medium ventures could only have started off slowly. A special attention has to be attended to small and medium ventures besides the abovementioned important facts, since their operation is decisively influenced by the domestic market.