Nearly 40 years ago, young mayor of Oita (one of the least developed prefectures in Japan in that time) - Mr. Morihiko Hiromatsu, introduced entirely new idea of regional development policy. This concept was named One Village One Product (OVOP). Thereupon, Oita was poor agricultural region that produced limited and not well known products mainly for localized use. Oita was highly dependent on financial support given by Government. Young people were not attracted to stay in the region. Hence, they rapidly started to move to more developed parts of Japan that offered better opportunities. The main vision of Mr. Hiromatsu was to vitalize Oita prefecture economy by reenergizing actual community, promoting its own regional resources, local culture and technical knowledge. He shifted focus of local producers from agricultural production with low margins to value-added products with high quality and diversification. Mr. Hiromatsu strongly promoted continuous improvement and human resource development as main principles of new development paradigm. 30 year later, after Mr. Hiromatsu left his long lasting call as a mayor, Oita became 9th most developed prefecture in Japan (Japan has 47 prefectures). GDP per capita was 25-50% higher than neighboring prefectures on the Kyushu Island, which still remained the least developed parts of Japan. After this great success of Oita prefecture, OVOP movement spread all over the world and became one of the most famous intrinsic methods for rural development. This practitioner study analyzes principles which Mr. Hiromatsu introduced in Oita prefecture; local yet global, self-reliance and creativity, human resources development, and discuses about potential adjustment and implementation of these principles in rural regions of Serbia in a way to foster growth of entrepreneurship and product innovation.

1. ICEIRD2010: International Conference for Entrepreneurship, Innovation and Regional Development Governmental and Regional Policies on Entrepreneurship and Innovation Implementationof Japanese Prefecture Oita Rural Development Model in Serbia Authors: AleksandarNedeljkovic DanijelaLalic Novi Sad, 27th-29th May 2010.

2. Meet us in one minute… Aleksandar Danijela Aleksandar Nedeljkovic FDI Advisor, Serbia Investment and Export Promotion Agency (SIEPA) E-mail: aleksandar.nedeljkovic@siepa.gov.rs Danijela Lalic Teaching Assistant, Faculty of Technical Sciences, University of Novi Sad E-mail: danijela.lalic.ftn@gmail.com Let’s get started… ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|2

3. What now? Serbian Investment and Export Promotion Agency | 3 It's not a lecture…

4. Serbian Investment and Export Promotion Agency | 4 …it's sharing of ideas!

6. oil, gas, coal, iron ore, bauxite, copper, zinc, antimony, nickel, gold, silver, magnesium, pyrite…

7. Produces only 40% of food it consumes

8. Imports almost all resources and raw materialsNatural resources Gross domestic product (GDP)per capita (nominal)* 34,116 USD 10,810 USD What can we conclude from this? * - IMF, 2008 ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|5

9. Oita prefecture in a nutshell Pacific belt Area: 6.338 km2(Kyushu island) Population: 1,2 million Prefecture GDP per capita: $36.881 (09) Geography: Oita is costal region covered by forests,and rivers and hot streams When comparing GDP per capita, Oita’s is 25-50% higher than those of neighboring prefectures on the Kyushu island - Kumamoto (27), Fukuoka (32), Miyazaki (33), Saga (37), Kagoshima (42) and Nagasaki (45). The question is WHY??? ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|6

10. What problems were facing Oita 30 years ago? Depopulation: young people were leaving Oita No competitive products: Oita’s products did not satisfy needs of customers Dependency upon government: Waiting for government to intervene These problems are present in all underdeveloped regions in the world ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|7

11. What are potential strategies to foster regional development? Extrinsic method Invite various industries from other regions to promote new industries to thrive Intrinsic method Stimulate the regional economy from within using local people, culture and knowledge Oita decided to implement the intrinsic method of regional development ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|8

12. The base for Oita’s magnificent growth… One village one product (OVOP) movement Creating globally-accepted products that reflect pride in the local culture Fostering of people with a challenging and creative spirit Independent actions utilizing the potential of the region Mayor of Oita Prefecture, Mr. Hiramatsu, defined principles underpinning the development of the OVOP movement ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|9

14. People choose products which will represent them

15. Focus on a quality as well as quantity

16. “We produce value-added products or we do not produce!”

17. Traveling and exchanging ideas with people abroadWhen we compare the price of 100g of Oita’s products we see that: Shiitake mushrooms (28 USD), Japanese spirits (2,3 USD), and Greenhouse oranges (2,8 USD) are more profitable than an average passenger motor car* (1,9 USD) * - average passenger motor car – weight: 1.5 ton, price: 28,000 USD ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|10

19. No financial subsidies for any project

20. Strong support in R&D and distribution

21. Mayor as key sales person

22. Awards for all achieversWe wait for government to do for us -> We initiate all motion We change the way we do things when we must -> Changes are a way of life ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|11

24. Strategies for bringing young people back

25. Lifelong learning

26. Night schools for re-education and retraining in specific fields

27. Fostering involvement of women (especially older women)The hardest things are to change life-long habits and convince young people to return ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|12

28. Key milestones of OVOP Initialization - Mr. Hiramatsu proposed the movement to regional leaders Spreading the idea- Mr. Hiramatsu delivered lectures on the movement to people of all sectors in all the regions of Oita Media campaign– The movement was further publicized through mass media Development of research capacities– Prefectural research and guidance facilities were established for technical support in various industries Training, Training and Training– Training and education were offered to regional and industrial leaders New system for distribution of products – A special system for the distribution and sales of OVOP products was set up Recognition – Achievers of OVOP were rewarded It is a steep and thorny way to a big successes! ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|13

29. Results: 20 years later Number of products 1980 2001 143 -> 336 Number of tourists 1980 2001 0.5M -> > 15M Total sales 1980 2001 $330M -> $1,300M In a 20 years, Oita went from being one of the Japan’s least-developed prefectures to one of its most developed ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|14

30. What we highlighted to Serbian municipalities as key success factors Awareness building in all directions Careful identification of local treasures Perseverance is a key to success Value-added or nothing Securing marketing channels Human resources development Serbian local municipalities were enlightened when we shared Oita case with them, now we need drastic action coordinated by strong local leadership ICEIRD 2010. Novi Sad, Serbia, 27 - 29 May 2010.|15

31. Serbian Investment and Export Promotion Agency | 16 Arigato gozaimasu... …thank you very much!!!