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New Challenges Facing Metropolitan Regions

New Challenges Facing Metropolitan Regions. Lamia Kamal-Chaoui Head of the OECD Urban Development Programme 25 March, 2010 . Overview. OECD Work on Cities and Metropolitan Regions.

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New Challenges Facing Metropolitan Regions

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  1. New Challenges Facing Metropolitan Regions Lamia Kamal-Chaoui Head of the OECD Urban Development Programme 25 March, 2010

  2. Overview OECD Work on Cities and Metropolitan Regions Athens, Busan, Cape Town, Copenhagen, Stockholm, Helsinki, Istanbul, Madrid, Melbourne, Mexico City, Milan, Montreal, Newcastle, Oresund (Copenhagen/Malmo), Randstad Holland, Seoul, Toronto, Venice, Vienna-Bratislava, Guangdong (Pearl River Delta) (China), Chicago and Johannesburg. A new series of national urban policy reviews (Korea, Poland, Chile) STATISTICS ON METRO-REGIONS OECD Roundtable of Mayors and Ministers on UrbanStrategy (3rd meeting: May 25th: Cities and Green Growthwith the C40) A unique international database on 78 OECD metro with a common definition of functional areas

  3. The Global Crisis (food, financial, economic) environmental): what development model do we want? Cities/Regions Three “E”s paradigm The OECD Green Growth Strategy Efficiency Environment Equity

  4. Cities/Metro-regions matter to efficiency objectives Share of national GDP A common OECD Definition for metro-regions based on functional areas Stockholm 78 metro-regions with more than 1.5 million inhabitants Around 50%: Budapest, Seoul, Copenhagen, Dublin, Helsinki, Brussels, (Montreal, Toronto, Vancouver in their respective provinces), etc. One third: Oslo, Auckland, Prague, Tokyo, Stockholm, London, Paris

  5. Cities/Metro-regions matter to efficiency objectives • Cities are key engines of national economies. Most of the largest OECD metro-regions have a higher GDP per capita than their national average, a higher labour productivity level, and many of them tend to have faster growth rates than their countries. •Agglomeration economies. The concentration of jobs and firms can be beneficial: pooled labour markets, backward and forward linkages among firms, and knowledge spill-overs can lead to higher productivity growth. Higher GDP per capita… Higher Productivity… Higher Employment…

  6. URBAN ASSETS • Advantages of both diversification and specialisation in high-value added activities More than 81% of patents are produced in urban regions • Strong innovative capacity • Great endowment of human capital Lower old-age dependency ratio Higher level of skills Stockholm Stockholm vs Sweden • Higher capital stock per capita (physical infrastructure, transport and telecommunications, universities and research institutes, etc..)

  7. Stockholm: a strong competitive region (GDP per capita (PPP) data for 2000) Stockholm ranks 25 out of 66 OECD metropolitan regions … …6 out 28 OECD European metropolitan regions

  8. Stockholm: a strong competitive region(GDP per capita (PPP) data for 2005) Stockholm ranks 23 out of 78 OECD metropolitan regions … …5 out 35 OECD European metropolitan regions

  9. Stockholm: a strong competitive region (data for 1995-2000) … and one of the highest GDP per capita growth since 1995

  10. Stockholm: a strong competitive region (data for 1995-2005) … and one of the highest GDP per capita growth since 1995

  11. But Metro-regions not Always Synonymous With Success!! • GDP and productivity growth not always higher than national averages

  12. Cities/Metro-regions matter to equity objectives One third of metro-regions have higher unemployment rate than their national averages • The Urban Paradox • Growth and Unemployment • Persistence of high pockets of unemployment • Lower activity rates in urban regions (44.3%) than intermediate (49.7%) and rural (44.5%) • Wealth and Poverty • High level of poverty in all types of metro-regions (e.g. about 50% in Mexico City, 22% in Rotterdam, 15% in Paris) • Spatial polarisation (in 10 OECD countries, up to 10% of the population live in distressed areas) • Exclusion of immigrants Criminality (30% higher in urban regions)

  13. Cities/Metro-regions matter to equity objectives In many cases intra-regional disparities are widest in large metro-regions in the OECD.

  14. Cities/Metro-regionsmatter to environmental objectives Climate change may significantly impact cities • In 2070, urban population in European cities will feel as if the weather has moved south (EU report, 2009)

  15. Cities/Metro-regionsmatter to environmental objectives • Coastal cities are particularly vulnerable (OECD ENV WP) The location of the 136 port cities • Port Cities at Risk: • As of 2005, 40 million people and 5% of global GDP are exposed • By 2070, 150 million people and 9% of global GDP expected to be exposed

  16. Cities contribute to climate change Half of the worldwide population lives in cities, projected to reach 60% by 2030 (UN, 2008) Cities are responsible for 2/3 of total energy consumption (IEA World Energy Outlook 2008) – IEA projects an increase in cities’ energy use (up to 80% in US and China) Cities/Metro-regions matter to environmental objectives

  17. Cities/Metro-regions matter to environmental objectives • Cities are responsible for 2/3 CO2 emissions (IEA World Energy Outlook 2008) • Higher level of urbanisation are correspond to higher levels of CO2 emissions Urbanisation (PU) and Carbon Emissions (CO2)

  18. Cities/Metro-regions matter to environmental objectives • Urban density emerges as a crucial element to reduce carbon emissions Urban Density and Electricity Consumption Urban Density and Carbon Emissions in Transport Sweden

  19. Cities/Metro-regions matter to environmental objectives Population growth in metro-region's core and belt compared • Sprawl is to be blamed • Expansion of urban land use since 1950 has doubled in OECD countries and increased by five times in the rest of the world • In 66 of the 78 OECD metro-regions, surburban belt grows faster than the core Trends in urban land expansion in the world and the OECD

  20. Cities/Metro-regions matter to environmental objectives • Urbanisation levels may correspond to an increase in CO2 emissions but emissions go down as density increases Urbanisation, Density and Carbon Emissions

  21. Cities/Metro-regions matter to environmental objectives • Lifestyle matters • Urban transportation modes influence the level of CO2 emissions (e.g. Los Angeles vs. New York) • Energy modes of production and energy efficiency supply influence CO2 levels (e.g. Cape Town vs. Geneva: similar level of per capita electricity consumption but more GHG intensity in Cape Town (relies on coal) than in Geneva (relies on hydropower) Concentration of Carbon Emissions in the USA (CO2 at the county level)

  22. A stronger, cleaner, and fairer economy : a new paradigm for the Global Economy Cities/Regions Efficiency Environment Equity

  23. Exploring synergies/complementaritiesExample: why environment is good for growth Urban policy (densification or congestion charges) can contribute to a reduction in global energy demand and CO2 emissions Percentage reduction in total CO2 emissions in OECD with a densification policy applied Results from a CGE model (IMACLIM with an urban module, using the OECD metropolitan database)

  24. Exploring synergies/complementaritiesExample: why environment is good for growth In the long run, the trade off between economic growth and environmental objectives observed at the macro economic level disappear at the local scale Economic growth with local climate policies Changes in GDP with densification and congestion charges policies (vis-a-vis baseline scenario) This is due to complementarities with other objectives (e.g. pollution reduction) felt at the local level that enhance city attractiveness and competitiveness

  25. Exploring synergies/complementaritiesExample: why environment is good for growth Attractiveness and Carbon Emissions related to Automobiles across Metro-regions Today, a group of highly attractive metro-regions are associated with high levels of carbon emissions Changes in Attractiveness and Local Pollution Emissions across Metro-regions But, results from the CGE model: by 2030, metro-regions will loose attractiveness if they continue to pollute

  26. Some policy implications for the new paradigm for urban policy • 1/ Seeking co-benefits • Examples: investment in green infrastructure and support to green R&D innovation can create jobs – densification can reduce CO2 emissions and limit the costs of sprawl • But also no-regret strategies: public health improvements, costs savings in energy efficiency, Energy security and infrastructure improvements, Improved quality of life) • 2/ Seeking complementarities and avoid conflicting outcomes • Examples: Conditions for successful compact city and densification policies include mixed land uses, mass transit services and urban amenities • 3/ Capacity to act depends on optimising modes of governance • Strategic planning is a key tool to ensure complementarities among different urban policy objectives • Urban finance needs to be streamlined (access to revenues, but also review of side effects) • Vertical collaboration is key (national governments have a key role to foster inter-municipal collaboration, provide incentives and sanctions)

  27. The world is changing: What about Stockholm? • Why did regionalisation progress in Sweden and not so much in the Stockholm region?

  28. Strengths and challenges of Swedish Multi level Governance to implement regional growth policy • Strengths • Balanced policy-mix: equity (mostly at the local level) and growth (national level) • High degree of trust & transparency in public decision-making • Good public-private cooperation • Well-developed inter-municipal cooperation for public service delivery • Agile government, with strong consensus building mechanisms • …and high capacity for (gradual) reform • Innovative governance approaches through learning-by-doing processes (pilot experiences) • Challenges • Elected regional actors not enough involved in the design & implementation of pro-active regional growth policies – apart from pilot regions • Limits of regional coordination bodies • Limited spatial/strategic planning at functional regional scale • Lack of effective implementation mechanisms (RUP: broad strategies) • Coordination gaps across levels of government: • Policy gap: lack of coordination across sectoral policies at the regional scale; by-passing of CAB • Information gap: high number of actors involved in regional development policy at all levels (asymmetries of information) • Small size of counties in some cases / widening labour market regions  critical mass debate • The governance of Stockholm’s functional region Current challenges call for further adjustments in multi-level governance arrangements

  29. The world is changing: What about Stockholm? • Is the concept of the Stockholm Malar Region still valid? • What about the regional economic development strategy? • Is there any evidence on policy outcome? (e.g. immigrants, youth unemployment, etc.) • Why does innovation still mainly come from large firms? • How to make sure that policy strategy will be implemented?

  30. Looking forward • Anticipating/adapting to the changes of the global economy (eg. What are the Stockholm’s main competitors and challengers?) • Fostering synergies and seeking co-benefits (e.g. first mover in the green economy; linking land use, transport and planning) • Making reforms happen (e.g. identifying obstacles, leadership, roadmap, timeframe, mointoring outcome, etc.)

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