Agriculture is an important source of employment and household income in the economies of the Southern Neighbourhood. Rural development is therefore key to boost the economy and reduce poverty in many countries of the region. The EU promotes the development of sustainable and inclusive agriculture and rural development policies through programmes like ENPARD (the European Neighbourhood Programme for Agriculture and Rural Development). The EU also invests in modernisation of equipment and farming techniques, crop diversification, income-generating activities in rural areas and the creation of value chains. Assistance is also provided to help address the degradation of natural resources and to tackle environmental challenges arising from climate change.