Amsterdam, Hamburg, Manchester, Stockholm: How cities are solving Europe's problems

Hamburg is just one of the cities playing an increasingly powerful role in European politics. Image: Reinhard Kraasch/Wikimedia Commons.

The European summer has been dominated by the Greek debt crisis. The headlines and news reports of urgent, tension-filled meetings of leaders from the European Commission, the European Central Bank, and national governments have only served to reinforce the common belief that power in Europe is now highly concentrated and centralised. 

Yet a recent OECD publication, “Local Economic Leadership,” reminds us that the European experiment is as much sub-national as supra-national, subject to decentralising as well as centralising dynamics. The report captures the remarkable efforts underway in Amsterdam, Hamburg, Manchester, and Stockholm – by networks of public, private, and civic leaders – to design and deliver key economy shaping investments and initiatives.

The study reaffirms a defining trend in the world today: the emergence of cities as not only the driving engines of national economies but the places where innovative problem solving is becoming the norm.

Three kinds of activities stand out.

First, European cities are working collaboratively with their neighboring municipalities to craft economic narratives and strategies at the metropolitan scale – the organising unit of the global economy. 

As an earlier OECD Report found, Europe’s metropolitan areas are dotted with hundreds and hundreds of small localities, each vested with certain powers and responsibilities. This intense localism may have made sense in prior centuries; but today it significantly undermines the ability to compete globally and coordinate on cross-jurisdictional matters such as transportation, the environment, and the economy.

Solving problems close to the ground is often more effective, efficient, and democratic than policymaking in a remote national capital

Europe is seeing a wave of voluntary efforts – and even some formal structural reforms – to counter this fragmentation and align with metropolitan geography. In Manchester, for example, all 10 separate local authorities banded together in 2011 to form the Greater Manchester Combined Authority and bring a unified voice to issues and investments that affect their shared economy.

In Stockholm, 53 municipalities participate in the Stockholm Business Alliance to create a common vehicle for branding and a one-stop-shop for investors, companies, and entrepreneurs. The Hamburg Metropolitan Region is similarly a voluntary association of administrative districts and cities in the bordering states of Schleswig-Holstein, Mecklenburg-Vorpommern, Lower Saxony, and Hamburg.

Second, European cities are taking on more powers and responsibilities, often in formal agreement with their national governments. 

National leaders are increasingly recognising that solving problems close to the ground is often more effective, efficient, and democratic than policymaking in a remote national capital (let alone at the European Union).

As one of Germany’s three city states, Hamburg wields significant constitutional powers and is able to affect federal legislation both through its representation in the Bundesrat and Germany’s unique form of cooperative federalism.

Manchester has become the test case for greater devolution in Britain, one of the most centralised states in the world. In March 2012, the Greater Manchester Combined Authority successfully negotiated a “city deal” with Whitehall that allowed for Manchester to earn back a portion of its tax revenue to create a revolving infrastructure fund, establish an investment framework to guide economic development, build a city apprenticeship and skills hub, and form a housing investment fund, among other initiatives. A subsequent agreement in November 2014 devolved greater policymaking and funding powers.

The Manchester Devolution Agreement shows a new level of assertiveness on the part of cities in Britain. As Sir Howard Bernstein, the chief executive of Manchester, writes in the foreword to the more recent OECD Report, “We have consistently promoted reforms that gave the city’s elected leaders more flexibility in how they generate and deploy resources, how they deliver high quality public services, and how they collaborate to achieve a scale of assets and opportunities that help us to compete in international markets.”

Finally, European cities are acting in ways that mobilise private and civic engagement and investment – and, as Jon Pierre recently wrote for LSE Cities, to “rethink the roles and interactions of local government, local NGOs, and the market”. 

Unlike national governments – which often operate through extensive partisan and political combat – cities are networks of public, private, and civic institutions and leaders that increasingly work together to solve problems and seize opportunities.

In 2010, for example, an Amsterdam Economic Board was established with representation from industry, universities, and local government.  The ambitious goal: to “develop the Amsterdam metropolitan area into one of the leading global business hubs in Europe and to position itself as an intercontinental hub of commerce, people, and information.” The method: foster collaboration across the “triple helix” of businesses, knowledge institutes, and government to drive growth in Amsterdam’s distinctive sectors.  

Unlike national governments – which generally make arms-length investments in urban development – cities actually make markets by creating new intermediaries, procuring services, or making smart decisions about land use and zoning. Hamburg is effectively expanding its city centre by 40 percent, through the redevelopment of HafenCity, a site formerly used for shipping and industry. Significantly, the redevelopment is being led by HafenCity Hamburg GmbH, a publicly owned urban development agency that has successfully guided and financed the transformation through the smart combination of public interests and private capacity.

The four cities selected by the OECD are exemplary, but not exceptional. Other cities are also doing extraordinary things which are the subject of global study, replication, and adaptation.

Barcelona has sparked a global trend by creating an innovation district that strengthens the links between anchor institutions, entrepreneurs, and business incubators. Copenhagen has used a public company (BY&HAVN) and strategic zoning decisions and land transfers to finance the bulk of its metro system. Sheffield has made advanced manufacturing a priority again, and the University of Sheffield has emerged as an innovative centre of applied research, corporate/university collaboration, and apprenticeship training.

The recent OECD report shows a more complex and multi-dimensional picture of Europe than commonly understood. It is a timely reminder of Europe’s inherent urban assets and long, proud urban legacy. 

Before there were nations in Europe, there were powerful city states like Venice that became centers of cultural and economic exchange. Before there were unions of nations, there were networks of cities like the Hanseatic League that powered the evolution of Northern Europe through intricate trading relationships. Unleashing the power of its cities and amplifying the smart urban leadership already on display may be one of the most important structural reforms for the new Europe.

Bruce Katz is vice president and director of the metropolitan policy programme at the Brookings Institution.

Luise Noring is program director at the Copenhagen Business School.

This article was originally posted on Brookings' blog.



Could twin towns bring Britain back together?

An unlikely pair. Image: Wikimedia Commons.

Twin towns: an irrelevant novelty to most of us, a peculiar name on a village’s welcome sign. But could linking one British town to another – a domestic reinterpretation of this long-standing European practice – help bring Britain back together in a time of national crisis?

Born in the aftermath of World War II, town twinning aimed to foster cooperation and solidarity across Europe. Communities entered formal alliances, nurturing friendships and shared histories. Coventry forged links with Dresden and Volgograd, then Stalingrad, marking the devastation faced by their citizens during the war.

The democratisation of Greece, Spain and Portugal during the 1970s led to a new wave of twin towns across Europe, as did the fall of the Soviet Union a decade later. Since its inception, the focus of town twinning has been on uniting people through relationships. It is a testament to the initiative’s success that many of these remain to this day; Coventry recently enjoyed a performance at the city’s cathedral by Volgograd’s children’s choir.

While European relations have improved since the 1940s, unity at home has received less attention. As a result, Britain is riven with deep economic, political, educational and cultural divides. These fault lines are increasingly determined by geography, with a growing gap between our big metropolitan cities and almost everywhere else.

In comparison to other European countries, we face staggering levels of regional inequality; six of the ten poorest regions in northern Europe can been found in the UK. As outlined by Alan Milburn, the government’s former social mobility tsar, “the country seems to be in the grip of a self-reinforcing spiral of ever-growing division. That takes a spatial form, not just a social one.”

These divisions are poisoning our body politic. As Adam Smith argued in The Theory of Moral Sentiments, putting yourself in someone else's shoes is vital for developing a moral compass; in doing so "we conceive ourselves enduring all the same torments, we enter as it were into his body, and become in some measure the same person with him..." But this is difficult when we have little interaction or experience of those with opposing views.

This is increasingly likely in geographically polarised Britain, with the places we live dominated by people who think alike. Our political leaders must commit time and energy to bridging these divides, just as the leaders of Europe did in the aftermath of the Second World War. By forging links between different parts of the country, a new era of domestic town twinning would do just that.

School exchanges between sister towns would offer an opportunity for children to be exposed to places, people and perspectives very different to their own. This would allow future generations to see things from an alternative and opposing perspective. It may also embed from a young age an awareness of the diversity of experiences seen by people across our highly unequal country.

MPs would be encouraged to spend time in their constituency’s sister town. First-hand exposure to voters in a very different part of the country would surely soften the views of even the most entrenched parliamentarian, making for a more civil debate in the Commons. Imagine the good this would do for Parliament today, with Brexit gridlocked because of the unwillingness of MPs to compromise.

In 2016 the Carnegie UK Trust launched its Twin Towns UK programme, a pilot linking twenty towns across the UK to examine how they might develop together. Emerging benefits include a reduction of insularity and a greater awareness of the bigger picture. Its focus was not on bridging economic divides – towns with similar socioeconomic characteristics were twinned – but initial outcomes from the scheme suggest a broader programme of domestic town twinning could have a powerful impact.

Looking further back, Camden has been twinned with Doncaster since the 1980s, a relationship that unionised Camden Town Hall workers forged in a display of solidarity with striking miners during the 1980s. Funds were raised to feed families of striking workers at the pit and Camden locals even drove north to deliver presents at Christmas. Though the relationship appears less active today, it serves as a powerful reminder of twinning’s capacity to bring people from very different places together.

As we prepare for Brexit it’s imperative that we protect existing twin town relationships with our European partners. This is of vital importance when we know sadly many of these are under threat from austerity and gloriously un-PC mayors. But we should look to breathe new life into these traditions too, where possible. Domestic town twinning would do just that: a step towards bringing Britain back together, just as a continent was reunited after the devastation of war.

Ben Glover is a researcher at the think tank Demos.