The objective of this chapter is to provide an approach to the farmland abandonment problem in Galicia, the Spain’s north-western region. We describe the land use pattern that characterized the traditional agricultural system, and analyze the process of structural adjustment and changes in land use recorded in the last 50 years. The empirical basis is provided mainly by an original elaboration of agricultural census data for the period 1982–2009. The results show that in the last five decades the area devoted to crops and pastures was constrained to a small portion of the territory (just over 20%), while the agro-livestock uses of hill land which were very important up to the mid-twentieth century disappeared. All this led to a remarkable expansion of abandoned land, which currently occupies at least 20% of the regional area. The drivers of this farmland abandonment are diverse and vary from one zone to another. But among them the conditioners derived from the structure of land ownership must be emphasized, coupled with the poor functioning of the land market and leasing. Land abandonment has had a major impact on the dynamics of the agricultural sector, limiting the size of farms and causing an increasing intensification in a small portion of the territory. This has also led to severe environmental problems, especially forest fires. Consequently, improving mobility and land use should be a priority of agricultural and rural development policies in this region.

The development of a sustainable rural world must have an innovative agri-food industry as one of its bases. This article offers a comprehensive analysis of the main drivers of innovation by small and medium agri-food companies in Spain. A combined multiple correspondence analysis (MCA) and structural equation modelling (PLS-SEM) is performed to identify the key factors among 63 indicators in the domains of the technology-organisation-environmental approach. The results suggest an open field of research. Positively related to innovation are firm capacities and financial resources. Moreover, agri-food firms innovate in products, processes or marketing in order to increase sales, enter new markets, or increase the quality of their products. On the contrary, most of these firms did not innovate to reduce costs or time of response, meet regulatory compliance or maintain employment. Authorities should be aware that smaller and younger agri-food firms face more restrictions to innovate, and firms feel public policies could help to meet market demand as a driving force of innovation. On the contrary, essential objectives of regional development such as environmental compliance and maintaining employment seem to depend solely on public action.

In the last 30 years, the Galician agricultural and agri-food sector has had to face deep changes in its operating environment, as a result of changes in markets, policies and societal demands. In that context, the sector has shown in some aspects a remarkable dynamism and response capacity. Examples include the growth of milk production, which allowed Galicia to consolidate its position among the top ten dairy regions of the EU, or the development of differentiated and quality productions, mainly in beef and wine. With regard to production technology, the agricultural sector maintained a high investment effort which, coupled with the accelerated decrease in labor, made it possible to correct the low rate of capital per worker. This investment effort also allowed the consolidation of a set of medium-sized professional holdings, still minority in number but already the productive core of the sector. However, despite the advances, the agri-food chain continues to register strong deficiencies, especially in two aspects: structural deficits in the land base of farms and land uses, and the weakness of the agroindustry. Deficiencies that have caused an increase in the deficit of the agri-food trade balance in the last three decades.