ESPON 2013 Programme Newsletter No 8/26 June 2009


Welcome to the eighth electronic ESPON 2013 Newsletter. It offers information on the latest developments of the ESPON Programme.

Message from the ESPON Coordination Unit:
The Global Economic Crisis, European Regions and Cities


Back from until now the largest ESPON Seminar, the understanding of the regional and local effects of the global economic crisis is a hot topic for policy makers, practitioners and scientists.

When addressing the global economic recession it is crucial to underline that the crisis is in progress. Despite the first encouraging signs of recovery, it is by far not sure that important features of the real economy, unemployment and closure of companies have passed the bottom. Attempts to measure the territorial footprint of the crisis at this stage will therefore only give a snapshot, and not indicate perspectives for the medium-long term. In addition, an evidence-based understanding of impacts based on facts on regions and cities is not yet possible as data broken down to regions and cities are not yet available.

Observations of structural developments, however, allow already formulating informed guesses on some territorial effects of the current crisis. The speakers and the discussions at the ESPON Seminar on 3-4 June 2009 in Prague took a first intelligent step to shape the understanding of the possible effects. Some of the key messages were:
  • Some countries are affected more than others depending of the solidity of the national economy and the consequences on domestic demand.
  • The crisis accelerates structural change of regional economies which will be due in the long term, generating threats as well as opportunities for regions pending on their assets and potentials.
  • Regions are hit in an asymmetrical pattern just like micro-regions and towns depending on the vulnerability in their economic base.
  • The economic specialisation of regions and the structure, size and solidity of local companies are important for the impacts experienced.
  • Some regions do better than before apparently un-affected or benefiting of the current economic situation.
  • Bigger cities could suffer more than smaller ones as their integration in the world market is more profound.
  • Large cities seem however better equipped to absorb negative impacts of the crisis as their capability to substitute labour market effects is higher.
  • In Central and Eastern Europe, capital cities seem less affected by the economic downturn than in other parts of Europe.
  • Long term benefits should be the focus of recovery measures taken by regions and cities addressing the opportunities inherent in the diversity of assets.
  • Territorial diagnostics should be enhanced as a tool in finding the best measures in combating the crisis.
Summing up the first discussion, it seems that country and sector specific impacts hit regions and cities in random territorial patterns. This is due to regional/urban vulnerability.

Contraction/lay-off seems often to depend on a combination of national economic vulnerability, the degree of export orientation in the regional/local economy and the presence of economic sectors with high vulnerability, such as finance and banking, housing and the automotive industry. The solidity of individual businesses is also an important factor that seems to explain some negative impacts on local labour markets. Whether larger or smaller cities in general conquer the current challenges best is disputed by experts and remains to be seen based on data and facts.

 

Peter Mehlbye
Director ESPON Coordination Unit
Please find below the ESPON 2013 Newsletter No 8.

Documents

ESPON Newsletter No 8/26 June 2009

  • MS-Word Document | 86KB

ESPON Newsletter No 8/26 June 2009

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