Monday, 27 July 2015 15:28

ESPON in Ireland - the economic crisis and territorial development

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Different European countries entered the crisis at different times, and the impacts of the economic crash have not been even. Ireland, like the UK, Iceland and the Southern European counties have seen the largest reverses in GDP per capita since 2007. In eastern Europe, the countries worst hit between 2007 and 2011 were Estonia, the Czech Republic, Slovenia and Croatia.

In marked contrast, much of Scandinavia and the north and east of continental Europe has experienced growth in per capita GDP over the period of the crisis. Poland and Macedonia lead the way, but Germany, Bulgaria, Romania, Hungary, Slovakia, Switzerland, Turkey and Latvia are not far behind.

While domestic economies may remain weak, exports have shown upward trends. Countries like Germany with things to sell on global markets have suffered relatively little; the damage in the Spain, Portugal, Greece and Ireland, countries that were converging towards the European average through strong pre-crisis growth, especially in property and construction, have been badly set back. As Adrian Healey (Cardiff University) highlighted, recovery in terms of jobs is strongest in the continental core of Europe.

The crisis in Ireland

Coming into Dublin through the north of the city, the traditionally poorer part of this historically divided capital, the shopfronts tell of the migration into the city during the boom years, as migrants from near and far came chasing jobs and money. But then the long lines of taxis waiting for fares depicts today’s economy. Temple Bar somehow sustains its carousing bustle, but in other parts of town the bars are empty by 9pm. The radio carries reports of Gaelic football teams folding as the young men migrate to Sydney, New York, Hong Kong or London in search of work.

Before the crisis hit, the Irish cities had one of the leading positions in Europe in terms of a low rate of early school leavers, an important measure for cohesiveness and competitiveness in the knowledge economy. This contrasted with very high drop-out rates in some Spanish cities, e.g. Valencia and Alicante. Now Spain is one of the few places where metropolitan centres have suffered worst in the economic crisis.
Ireland plans for recovery

Dick Gleeson (Dublin’s Head of Planning) gave a passionate argument for using place-making and urban design as a way to generate growth. He highlighted the strategies past, present and future to regenerate the east side of Dublin, the area of the Docklands that connect the city to the sea.
Similarly, Niall Cussen from Ireland’s ministry responsible for Environment, Community and Local Government, highlighted the importance of the new National Spatial Strategy as a tool for economic recovery. He put the case for planning as an “energiser”, not just a form of statutory regulation. As Cussen noted, a key reason why Ireland now faces such great challenges is that it had become “an economy based on selling property to each other”. The country was no experiencing the costs of not planning.

The Irish papers report signs that the government is moving to try to stimulate the economy again, after the long period of austerity. 6.4 billion Euros is being moved from the National Pension Reserve Fund to a new investment fund . On the radio I hear that a regeneration project is to be launched in run-down town centre of Limerick, Ireland’s fourth largest town. Pity about the permissions given in the boom years for out-of-town retail parks near to the city.

Competitiveness, cohesion and community initiatives

In the ESPON seminar, Michael Parkinson from Liverpool John Moores UnIversity argued that there was a great risk that in the crisis, the gains made by Europe’s second cities before the crisis will be lost. Parkinson’s message was that we need to retain capacity through these difficult times. There is too much fear and too little money: public action is crucial; planners and policy makers need to lead, not blink.

I facilitated a workshop that looked at infrastructure and transport. Klaus Spiekermann, who is working on the ESPON research on transport and accessibility, argued that a pattern of transport investment to support the large and medium-sized cities is likely to offer the best trade-off between competitiveness and cohesion.

Eduardo Dias suggested that we need to change our ideas about “smart cities”: efficient technology helps, but ultimately smart cities are made by smartpeople. Dias pointed to the way that citizens are using smart technology to create new relationships to governments. One example is Hack der Overheid which looks for “Hacks of kindness” and has run “Hackathons” to explore ways to use open source data.

A fundamental restructuring of services and places

I came away feeling that the scale and significance of the restructuring that is taking place has still not been fully grasped. The crisis has altered patterns of investment by the private sector. Banks are only lending to low-risk investments, and are particularly cautious about property investment. The result is that investment is increasingly concentrated on the capital cities. Smaller towns faced with disinvestment will fall further behind.

To sustain the banks public services are being cut. This process again has a strong spatial component. One way to reduce spending is to “rationalise” and centralise service provision, e.g. through closure of schools and hospitals, or through creating larger units of public administration. Yet public service jobs have been crucial parts of the economy in non-capital city regions.

I cannot help but reflect on the ways in which the development of Europe’s regions and the policy context has changed since the European Spatial Development Perspective  was agreed by the then 15 member states in 1999. Remember, it was subtitled “Towards balanced and sustainable development of the European Territory”. The three key objectives then were economic and social cohesion; conservation of natural resources and cultural heritage; and more balanced competitiveness across Europe. Fourteen years on, who can claim that these objectives define Europe’s trajectory, or the recent history of Ireland?


This blog was first posted on the Planning Resource website on 20 June 2013

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