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Eurocities EDF, Glasgow. City Competitiveness:...
Transcript of Eurocities EDF, Glasgow. City Competitiveness:...
Greg Clark
World Bank
February 2011
Strategies and Catalysts for Urban
Economic Development After the Crisis
The Agenda: Cities and Investment, City
Economic Development
The Agenda: OpenCities, London, New York,
Barcelona, Cape Town, Joburg, Toronto, Sao
Paulo, Mumbai, and ….
Today
Overview
Crisis and after
Local economies
Next economy?
Catalytic projects play in city strategic plans?
- Hosting Global Events
- Development Agencies
Local Government/Economic Development
Local development systems
Local economic leadership
After the crisis?
Recession, Recovery
and Reinvestment
“Recession, Recovery and Reinvestment:
the role of local economic leadership”
OECD LEED Programme Book
The impact of, and response, to the crisis and recession in 41 localities:
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Aarhus
Barcelona
Basel
Berlin
Bilbao
Birmingham
Brussels
Cardiff
Cologne
Glasgow
Rome
Turin
Zurich
Budapest
Prague
Riga
Warsaw
Vienna
Los Angeles
Miami
New York
Pittsburgh
Toronto
Cape Town
Beijing
Hong Kong
Mumbai
Shanghai
Singapore
Tokyo
Auckland
Hamburg
Helsinki
Lille
Liverpool
London
Lyon
Marseille
Milan
Munich
Paris
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Banking Crisis
Recession
Policy Response
and Stimulus
Public Finance Crisis
Global Economic
Shift Cities in
the Crisis
Four key areas of concentration observed:
New economic strategies: Focus around distinctiveness, high
skills, talent attraction and innovation
New investment strategies: New and innovative approaches to
partnering and delivering with the
private sector
New partnerships with higher
tiers of government: New long term working relationships
with central government in particular
based on more flexibility and local
autonomy
New focus on efficiency: Drive for improved quality at lower costs
Towards long term recovery and reinvestment
The new world city horizon
A larger, more diffuse network of world cities, with a reorganised basisfor competition
BUT High value-added knowledge-intensive business more critical than ever
Cities need access to finance capital, accounting/legal services, insurance,marketing, advanced logistics to meet supply chain functions
Expertise AND Attractiveness: The challenge for established world cities
Improve quality of life• Reduce congestion (Paris 2006-2030 master plan for sustainable mobility, London
congestion charge, Tokyo 3 loop roads by 2015)• Affordable Housing (New York $7.5bn New Housing Marketplace Plan up to 2013)
Improve governance and establish networks of partners Integration of governance capabilities across national and local scales, to provide
framework of collaboration for city and partners (Greater Paris initiative andLondon’s mayoral system post-2000)
Global environmental and climate change leadership PlaNYC (2030) , the 10-year plan for a Carbon-Minus Tokyo
Adopt single tightly co-ordinated brand platform for international promotion (‘Barcelona GLOBAL’ international positioning programme, and NYC Marketing)
Use land-use powers to drive social and regional territorial equality Strategies to counter unequal development (Paris regional SDRIF plan) Commitment to care for aging society (Tokyo model for sustainable anti-agist society)
Power AND openness: The challenge for emerging world cities
Openness to international populations and ideas are critical for success of powerfulemerging world cities. Many are working on a range of internationalisation strategies:
• Improved business climate• (Toronto Agenda for Prosperity, Mumbai Transformation Programme, Miami International Trade
Consortium)
• Ambitions to become a regional/international talent capital• (Hong Kong’s ‘Asia’s world city’ positioning, Singapore’s ‘Global Schoolhouse’ campaign, Sao Paulo’s
study abroad initiative)
• International event-led marketing and infrastructure overhaul• (Cape Town’s leverage of 2010 World Cup, Auckland’s 2006 City Events Strategy)
• Investment in and promotion of cultural and recreational qualities.• (Singapore’s ‘Global City for the Arts’ branding and Renaissance City Plan, Louvre Abu Dhabi)
• Generating international institutional and organisational presence• (Turin’s attraction of EU/UN bodies)
Embrace the next economy? New cycle
features.......
• Productivity rather than consumption.
• Distinctive rather than „copying‟.
• Specialisation in knowledge-led activities.
• Entrepreneurship and Innovation.
• Orientation towards growing markets.
• Human capital, Talent, Openness,
• Quality of life and Quality of place.
• Green economy, Resource efficiency and Low carbon.
• Leadership rather than Government......
• Assets rather than cash.....
Lessons from N America, lessons from Europe.
Catalysts
Hosting global events
Development Agencies
Global Events
EXPOs, World Cup, Olympics, Festivals.
Who is now bidding and hosting?
Catalysts with multiple benefits.
Alignment and acceleration of city plans.
Good planning and management of benefits and leverage is essential.
Influence public investment cycles
Global Events and Local Development
“The Urban Investment Opportunities
Of Global Events” (July 2010)
Previously held events
• Barcelona, Summer Olympic Games 1992
• Paris, FIFA World Cup 1998
• Lisbon, EXPO 1998
• Turin, Winter Olympic Games 2006
Planned events
• London, Summer Olympic Games 2012
• Glasgow, Commonwealth Games 2014
• Milan, EXPO 2015
Events being considered
• Amsterdam, Summer Olympic Games 2028
Global Events and Local Development
"Local Development Benefits from
Staging Global Events” (2008)
• EXPO
• Petroleum Congress
• City of Culture
• Summer Olympic Games
• Winter Olympic Games
• FIFA World Cup
• Americas Cup
• G7 & 8 Summit
• EU Summit
• Earth Summit
Tensions
i. Existing strategies and plans v new opportunities
ii. New start or accelerator?
iii. Place improvements v social and economic outcomes
iv. Awarding bodies v Host bodies
v. Purpose v benefits
vi. Direct v indirect impacts
vii. Inclusion v exclusion
viii. Short term v long term
ix. Skill and leadership v lack there of
x. Good luck v bad luck
Sciencewww.citiesandregions.com 18
The right event?
The benefits of bidding
Developing a clear and effective legacy
Breadth of legacy benefits:
Visitor Economy
Transport and urban infrastructure
Cultural infrastructure
Sporting infrastructure
Visible legacy
City image, marketing and positioning
Business interest and investment
Science, Research, Education, Innovation.
Managerial and events strategy
development
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Developing a clear and effective legacy
Depth of legacy benefits: (+ 1 to + 10 years)
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Developing a clear and effective legacy
Events help overcome problems that cities have
Investment Failure: leverage
Market failures: stimulus
Co-ordination and capacity failures: governance dividend
Information failures: communication opportunity
Raising civic ambitions and expectations. Shaping an investment market for several business cycles.
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Case Study: Cape Town World Cup 2010
Infrastructural legacy – $2 billion investment in 3 years
16.5
hectare
Green
Point Urban
Park
Upgrade of key
interchanges on
highways
connecting the
Central City: eg
Hospital Bend -
$40 million
Upgraded
rail
network
($65 million
upgraded
CT Station)
First phase of
new Integrated
Rapid Transit
System,
including
connection to
CT airport.
Case Study: Cape Town
Impact on business
•Tourist industry: 20-25% growth during World Cup; lessons from organising
unique and authentic Cape Town visitor experience
•Stronger Cape Town profile and brand = enhanced business branding and
marketing
•Future leverage as an event, conventions and festival city
Impact on governance
• Enhanced citizen participation - improved communications with Central
City stakeholders
• Enforced cooperation: Govt departments, city agencies and private
companies learning to work more closely together
• Skills development: negotiating with FIFA and national government,
planning and coordinating diverse work-streams, issuing complex tenders,
managing multiple contracts, up-skilling construction industry
• Long-term planning - impetus for City Development Strategy, Central City
Development Strategy and Creative Cape Town (bid for World Design Capital
in 2014)
Case Study: Johannesburg World Cup
2010
Urban regeneration
The Ellis Park Precinct - $15 million City
investment, $55 million private investment
• new public square, new park
• Upgrade of commuter train station
• New 5-a-side soccer pitches for children
• release of public land made available for housing investment
Nasrec Precinct (between Soweto and
Johannesburg)
• New coach station, updated train station
• new pedestrian bridge linking divided areas.
• public land holding released for housing
investment in 2010
Case Study: Johannesburg
Transport modernisation
Bus Rapid Transit system
• runs from Soweto into inner city
• Speed of funding and development
directly linked to WC
• boost for residential and business
investment in low-income areas
Gautrain
• South Africa‟s first fast inter-city
commuter train, between Jo‟burg,
Pretoria and Tambo Airport.
• Biggest PPP in Africa, $4bn
• Forecast 140,000 passengers per day
Insights
The science of benefits and costs is incomplete.
Skills, capacity, institutional ability and leadership are critical, but challenging issues.
Planning and building the legacy different task from running the event.
Developing Countries have to get the match right between the event and the impact they need.
Governance benefits should not be overlooked: vertical, horizontal, public/private.
Image, Identity, Reputation, must be built through the event process and will stimulate multiple benefits. Visitor economy can leverage other opportunities.
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Development Agencies and Companies:
What are we talking about?
• A means to undertake some forms of city development in the public interest utilising a corporate structure rather than a municipal or governmental structure. Doing some of the business of local government as a business rather than as a local government service provider.
• Ensuring that Local Government has short life entities that can do complex interventions effectively with different skill sets and arrangements from those that Local Government usually has. Skills that Local government does not always otherwise have.
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Development Agencies: No single model: a wide
variety
Different starting points:Europe, North America, Asia, Latin America,
Different constitutional contexts.
Different freedoms and flexibilities.
Comprehensive, niche, sectoral development agencies.
Defined territories.
Public/Public, Public/Private, Private/Private.
Governments, Business, Trade Unions, Community.
New partners emerging: Universities, Airports, Sports Clubs, Utilities, Major Landowners…
Leads to different missions, objectives, and priorities.
Need for learning, and not copying.
Governance roles? Instrumentation roles? Joint Venture roles?
Business led development agencies?
Development Corporation Typologies
Typology
Urban
Development and
Revitalisation
Agencies
Productivity
and Economic
Growth
Agencies
Integrated
Economic
Agencies
Internationalisat
-ion Agencies
Visioning and
Partnership
Agencies
Purpose “Place drivers”
“Employment
and productivity
drivers”
“Place and
productivity
leaders”
“Place and
productivity
promoters”
“Place -shapers
and visioners”
Example
Agency
Value Added of Development Agencies
*Aggregate* Bring together otherwise disparate economic development efforts within one body
*Pace* Accelerate the local response to investors/developers.
*Scale* Enhance the magnitude of implementation, byenabling simultaneous delivery on multiple programmes andprojects by commissioning additional resources quickly
*Credibility* Enhance the reputation of local „negotiators,‟leading to external investor confidence
*Risk-sharing* Share costs etc between those partnerspromoting developments and investments
*Value Capture* Enable some of the fruits of economicdevelopment to be recycled within city budgets andprogrammes
Value added of Development Agencies
*Leverage and Capitalise* Unlock otherwise under-used assets, for example in real estate or infrastructure
*Financial Innovation* Devise wholly new sources and instruments for investment, perhaps in partnership with private financiers.
*Investment-readiness* Readying of key local projects, developing the propositions to make them more attractive to external investment.
* Efficiency* Increase efficiency in the utilisation of land, property and local investment markets
*Co-ordination* Overcome „co-ordination failures‟ arising from fragmented jurisdictions
*Promotion* Brand and market the city better, overcoming information gaps+ asymmetries to build a clearer image+ identity
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Development Agencies fostering the city
development system
i) Rowing ii) Steering
iii) Cheering iv) Coaching
Bilbao-Ría 2000: Bilbao Local Development System
NYCEDC: NYC Local Development System
Leadership and Systems
The local government role in the 21st century?
The role of Local Government...
The 4 roles of local government
i. Representation.
ii. Local Services.
iii. Regulation.
iv. Development and Investment.
What are the ingredients of the local government
role in the 21st century?
The role of Local Government...
The 4 roles of local government
i. Representation.
ii. Services.
iii. Regulation.
iv. Development and Investment.
• This 4th role is different: requires additional expertise, new
geographies and new structures and arrangements...
Acting upon markets...
Acting within markets...
Political Economic
Political geography Economic geography
Political time Economic time
Political actors Economic actors
Political money Economic money
Core challenge for local government engaging with
economies
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Framework for local development
Pre-conditions
Business
environment
& investment
Educational
and research
base
Land and
physical
infrastructure
Social/ cultural
infrastructure &
quality of life
Ecological
base
Innovation
& creativity
Industrial
structure
Business
ownership & mgt
Human
capitalConnectivity
Use of
resources
Productivity Population
Development and growth
Drivers
Global economy and
Macro-economic
framework
Feedback effectsMarkets
Governance
structure
Environ
mgt
Leadership challenges in cities and
regions.
i. Transition to a new economy and its business requirements
ii. Speed of adjustment to post oil economy and low carbon futures
iii. Openness to international populations
iv. Rapid and dynamic growth of metropolitan regions
v. Service needs of dynamic populations and businesses
vi. Greater transparency to customers and stakeholder
vii. Investment not enough. Financial resources are finite and national public finance is slow to follow growth. Lack of investment tools
viii. Formal power and competence less than needed. City and regional governments do not control everything: boundaries, competences, division of labour with higher/lower tiers, markets, regulation/freedom
ix. National and sub-national governments guard their own space. Co-ordination challenges
Capacity and leadership issues in local
economic development
• One Plan, One Voice, One Identity
• Economic agenda across whole City Government
• Organised and demanding business leadership
• Customer orientation
• Focus on a number of top priorities, sectors, and spaces
• Expanding capacity to implement
• Range of delivery vehicles that can attract external investment.
• Problem solving and Project Management orientation.
• Strong economic agenda and partnerships
• Collaborative leadership that leads, empowers, focuses on big
picture
How does Local Government have a role in
economic prosperity?
Roles of Local Government depend upon constitutional position
of local government and existing institutional frameworks.
i. Vision setter and planner.
ii. Local dimensions of business climate.
iii. Infrastructure advocacy and management.
iv. Convenor and broker of alliances and coalitions.
v. Good local governance and services (planning, transport,
energy, education, housing, amenity).
vi. Information and communication (and branding and
positioning?)
vii. Physical capacity, and area regeneration.
viii. Local economic management (eg CBDs, Tourism areas, ports,
industrial parks, etc)
ix. Enterprise and Employment interventions.
x. National and Regional alliances and coalitions.
Bilbao Local Development System
Local Economic Leadership and the Local
Economic Development System
Economic Development
AgencyInstitutional
Effective
Local
Economic
Leadership
Private and Business Sector
And media
City Council
Citizens Groups
National
Government
Transfer between Countries 1
i. LED is not easy anywhere. Most OECD countries do it with variable success. Crisis has forced a rethink.
ii. Major co-ordination and leadership challenges are faced.
iii. Local Government has to operate well beyond it’s formal power, but can only do so if it uses it’s formal power well. Credibility.
iv. Convening and co-ordinating skills are to the fore.
v. The catalysts are seen as ways of producing this capacity. Pacing devices, partnering mechanisms.
Transfer between Countries 2
i. Many are now seeking to use or adapt tools developed in OECD countries. But the tools are not perfect and often context dependent.
ii. Most urban innovation requires creation of new tools because most governmental systems are not fit for economic development purposes.
iii. Most such tools, when they work, rest upon somewhat mature institutions, a deep pool of leadership talent, and negotiated systems. The tools don’t work on their own.
iv. The key issue is leadership talent. How it is developed and how it is recognised.
v. The bank can and does play a key role here.
Common Challenge
a. Economic Growth
b. Economic Development
c. Economic Inclusion
These are not alternatives. They need to be combined.
Common misunderstanding that we need to resolve.