2. The potential and threats to a sustainable urban development

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1 Annex 1. The urbanisation of Europe and the World More than half of the world population lives in urban areas although not all regions of the world have reached this level of urbanisation; Asia is expected to reach 50% urban population by 2020 and Africa in World population is expected to increase by 2.3 billion by 2050, in the same period urban areas will gain 2.6 billion and rural areas will lose 300 million people. Most of the population growth expected in urban areas will be concentrated in the cities and towns of the less developed regions. Asia, in particular, is projected to see its urban population increase by 1.4 billion, Africa by 0.9 billion, and Latin America and the Caribbean by 0.2 billion. In the developed world the annual growth rates of urban agglomerations is slowing down compared to the previous 40 years. 1 Europe already became predominantly urban in the beginning of the 1950s. In the last century Europe transformed itself from a largely rural to a predominantly urban continent. Today, approximately 359 million people - 72 % of the total EU population - live in cities, towns and suburbs. Although the speed of transformation has slowed down, the share of the urban population continues to grow. However, Europe is characterised by a more polycentric and less concentrated urban structure compared to, for instance, the USA or China. There are 26 cities of more than 1 million inhabitants and additional 373 cities of more than inhabitants in the European Union, representing around 165 million people. Only 7 % of the EU population live in cities of over 5 million inhabitants compared to 25 % in the USA. 2. The potential and threats to a sustainable urban development The concentration of consumers, workers and businesses in a place or area, together with the formal and informal institutions that make an agglomeration thick and cohesive, has the potential to produce externalities and increasing returns to scale. Sixty-seven per cent of Europe s GDP is generated in metropolitan regions, 2 while their population only represents fifty-nine per cent of the total European population. A comparison of European cities economic performance also indicates that the major cities are doing better than the rest. 3 Capitals and larger metropolitan regions have also performed better during the economic crisis than smaller metropolitan and non-metropolitan regions 4. However, there is marked difference in performance between capital and non-capital cities. It is hard to distinguish the effects of agglomeration alone from the positive externalities of being a capital city and centre of both public and private administrations. There is also an even bigger difference between Western and Eastern non-capital cities that cannot be explained by size alone World Urbanization Prospects: The 2011 Revision, United Nations Department of Economic and Social Affairs/Population Division, New York 2012 Metropolitan regions are defined as larger urban zones with more than inhabitants (Source: DG REGIO). State of European Cities Report, European Commission 2010; 8th Progress Report on Economic, Social and Territorial Cohesion, European Commission

2 EU-28 Romania Bulgaria Lithuania Croatia Poland Hungary Latvia Slovakia Spain Finland Portugal Estonia Ireland Greece Cyprus Czech Italy Malta Slovenia Sweden France Luxem Netherl United Denmark Germany Belgium Austria A concentration of activity is neither a necessary nor a sufficient condition for high growth. Small and medium sized cities also possess a significant potential for development which Europe needs to fully unlock to achieve its strategic objectives. Although cities are generators of growth, the highest unemployment rates are found in cities. Globalisation has led to a loss of jobs especially in the manufacturing sector. As an effect of the crisis the share of the population at risk of poverty and in low work intensity households has increased. Many cities face a significant loss of inclusive power and cohesion and an increase in exclusion, segregation and polarisation. Cities contribute to the reduction of energy consumption and CO 2 emissions as the density of urban areas allows for more energy-efficient forms of housing, transport and service provision - people living in an urban area use less energy and less land for their transport and housing compared to people living in other areas, and service provision is also more efficient in cities. But uncontrolled urban sprawl is countering the positive impacts on resource efficiency of compact urban settlements. The starting points, potential and development trajectories of cities across Europe are very different. In addition, the policy levers, such as policy competences and taxation powers also show significant variation across Europe and do not always mirror cities' responsibilities for implementation of policies, directives and regulation set at higher government levels. There are many examples of public budget cuts at national level with devolved responsibilities for cities without additional budget. The economic crisis has amplified such tendencies and led to diminished opportunities for longer-term investments. Shrinking and ageing populations have put public services under strain to operate oversized infrastructure with reduced tax bases. Coupled with the negative effects on local economies, many cities find themselves in vicious circles, which seriously undermine their capabilities to exploit their full potential and contribute to EU objectives. Figure 1: At-risk-of-poverty rate by degree of urbanisation, % of population at risk-of-poverty by degree of urbanisation Cities Towns and suburbs, Rural areas * IE, 2011 Source: 8 th Progress Report on Economic, Social and Territorial Cohesion, European Commission

3 Table 1: Cities of Tomorrow main urban challenges 5 Smart Growth challenges 1. Support a transition towards a knowledge society: e.g. smart cities as technology-enhanced urban development (FI); building on social, organisational and technical innovation and on community competencies; new educational pathways; develop a favourable entrepreneurial environment; develop local & social economy; 2. Develop city resilience to economic pressure and financial crises e.g. ensure social services, maintain a viable manufacturing sector, maintain social capital. Green Growth challenges 3. Ensure sustained investment for public transport and shift to a more sustainable urban mobility; Energy-efficient building and energetic urban renewal (DE); Achieve greater energy and resource efficiency and manage the transition towards a carbon-neutral city; 4. Sustainable management of natural resources (e.g. water, waste, air, soil and land), safeguard against physical and environmental degradation, urban sprawl, etc.; 5. Accelerate transition towards a sustainable city given the inherent inertia of infrastructure provision (e.g. housing, transport, water and energy systems). Inclusive Growth challenges 6. Counter social/spatial segregation/polarisation; acting for urban deprived areas (FR); reduce child poverty in urban areas (BE); ensure social & functional mix and cohesion; allow a cultural mix; affordable housing for all (NL); address urban sprawl (e.g. mitigation of gentrification effects, fair distribution of income and welfare); 7. Develop capacities for social and economic integration of newcomers, especially migrants and the socially disadvantaged; combat youth unemployment (under discussion during IE Presidency); 8. Manage and adapt to demographic changes due to ageing, age imbalances, intra-eu mobility 6 (LT), trans-national mobility, migration strategies (e.g. attract qualified migrants) as a solution to labour shortage. Transversal Challenges / an integrated approach to urban development 9. Foster cities' attractiveness e.g. develop public open spaces; education, culture, sports, creativity and cultural/industrial heritage; safety and security; 10. Ensure territorial coherence and cohesion e.g. urban/peri-urban cooperation, cooperation between the metropolis and its hinterland and manage urban/rural linkage. 5 6 As part of the Cities of Tomorrow reflection process a synthetic list of 10 key urban challenges was agreed by the urban experts and used as a basis for the discussions. These are listed above under four headings: smart growth; green growth; inclusive growth and transversal challenges. The list also includes major urban challenges put forward by Member States in the context of the intergovernmental cooperation on urban development (as discussed in the meeting of Directors-General responsible for Urban Development organised by the Lithuanian Presidency). LT suggest using the term intra-eu migration whereas at European level migration refers to third country flows. 3

4 3. EU urban policy Economic, social and territorial cohesion all have a strong urban dimension. As the vast majority of Europeans live in or depend on cities, their developments cannot be isolated from a wider European policy framework and the EU has had a growing impact on the development of cities over recent decades, notably through the Cohesion Policy. In terms of aims, objectives, and values, there is an explicit agreement on the character of the European city of the future and the principles on which an ideal European city should be based. These principles can be found in the objectives of the Treaty, in the Charter of Fundamental Rights of the European Union, in the European Social Model. There is also a consensus among the ministers responsible for urban development on more specific city objectives and values - as reflected in the Leipzig Charter as well as how these objectives should be attained and the instrumental role cities can play in implementing Europe 2020 as expressed in the Toledo Declaration. The same goes for the principles of urban development in the European territory as expressed in the Territorial Agenda of the European Union 2020 (TA2020). Cohesion policy, through the URBAN Community Initiatives 7 and the subsequent mainstreaming of integrated sustainable development, has fed the intergovernmental process with practical experience. Together they form what is known as the Acquis Urbain. The European Cities of Tomorrow are places of advanced social progress; they are platforms for democracy, cultural dialogue and diversity; they are places of green, ecological or environmental regeneration; and they are places of attraction and engines of economic growth. The future European urban territorial development should reflect a sustainable development of Europe based on balanced economic growth and balanced territorial organisation with a polycentric urban structure; it should contain strong regional centres that provide good accessibility to services of general economic interest; it should be characterised by a compact settlement structure with limited urban sprawl; and it should enjoy a high level of protection and quality of environment around cities. [Cities of Tomorrow, European Union 2011] However, if there is an agreement of the principles that should guide urban development in Europe, there is a lack of explicit objectives, targets and instruments. There is no explicit urban dimension in the Europe 2020 strategy and its targets. The addition of Urban Policy in the name of the Directorate General for Regional and Urban Policy came in 2012 and was partly a response to the strengthening of multilevel governance in the Lisbon Treaty, but above all a recognition of the importance of the local level in general and cities in particular as key actors for European development. One of the objectives of DG Regional and Urban Policy is to ensure that cities play their full part in the economic, social and territorial development of the EU. In the programming period a minimum 5% of national ERDF allocations have been earmarked for integrated sustainable development to ensure that it is a priority in all Member States. 7 URBAN I ( ) and URBAN II ( ) were two Community Initiatives of the European Regional Development Fund (ERDF) focused on the sustainable integrated development of deprived urban districts. 4

5 City networking and exchange will continue to be promoted by the next generation URBACT programme. In addition to these resources dedicated to integrated sustainable urban development, an estimated 50% of the ERDF, around billion Euro, will be invested in urban areas through the mainstream operational programmes. An increasing number of EU policies explicitly target urban areas; Education and Culture, Transport, Energy, Information Society, Environment, Climate Change, etc. support initiatives such as European Capital of Culture, Smart Cities and Communities European Innovation Partnership, Green Capital Award, Covenant of Mayors. Many other EU initiatives or directives implicitly target urban areas, e.g., noise and air quality directives, migration policies, etc., which although not urban per see de facto chiefly concern urban areas. 5

6 Table 2: European Commission initiatives with an urban dimension DG/ Agency Policy/ Regulation Targeting Cities/ local Local projects Studies/ research Tools Climate Action Renewable Energy Directive Climate and Energy package Competition State aid control in SGEI / public services Communication, Networks, Content & Technology Digital Agenda for Europe Smart Cities and Communities EIP Digital technologies in providing public services Green Digital Charter FP7/CIP projects - pilot sites across Europe ICT for Energy Efficiency Local and Regional Initiatives (SMART 2009/0073) Wiki developed under the study SMART 2009/0073 Green Digital Charter tool kit (NiCE project) Education and Culture Cultural and creative industries for smart specialisation Inter-cultural dialogue European Capitals of Culture European Heritage Label European Environment Agency TERM 2013 report SOER Air Implementation Pilot CORINE Land Cover project Employment, Social Affairs and Inclusion Social exclusion Urban poverty and social exclusion ESF investments Energy Energy Efficiency Directive Smart Cities and Communities EIP Covenant of Mayors Connecting Europe Facility ELENA Facility Environment Air and water quality Noise reduction Waste treatment Biodiversity 7 th EU EAP priority objective 8 Green infrastructures Thematic Strategy on the Urban Environment LIFE programme Horizon2020 Societal Challenges European Green Capitals Award 6

7 Eurostat Urban Audit: statistics on European cities Study on comparable Labour Market Areas Typologies of Metropolitan areas (NUTS-3) and Degree of Urbanisation (LAU-2) Classifications of Core cities, Larger urban zones (LUZ), Subcity districts (SCD) and Kernels Home Affairs Immigration Organised crime and human trafficking Integration of non-eu migrants Crime prevention and reduction Asylum, Migration and Integration Fund European Web Site on Integration Joint Research Centre Justice Anti-discrimination Ethnic diversity of urban areas Sustainable Urban Living Strategic Activity Modelling framework for integrated assessment Indicators and trends for EU urban areas; Outlook of EU cities Scientific and technical support to EU regional and urban development policies; H2020 Mobility and Transport Transport White Paper TEN-T Urban Mobility Package Smart Cities and Communities EIP Connecting Europe Facility CIVITAS 2020 Sustainable urban mobility plans ELTIS portal on urban mobility 7

8 Regional and Urban policy Integrated approach to sustainable urban development Green Paper on Territorial Cohesion ITI, CLLD, 5% of national ERDF allocations integrated sustainable urban development (ERDF Art.7) ERDF investment priorities specifically targeting urban areas Innovative Actions in the field of integrated sustainable urban development URBACT city networking programme 50-60% of ERDF invested in urban areas Cities of Tomorrow, Perception survey on the quality of life in cities ESPON research Reference Framework for Sustainable Cities (RFSC) Research and Innovation Innovation Union Horizon 2020 Horizon 2020 research areas Health and Consumers Health programme European Consumer Agenda Health inequalities in urban areas Empowering consumers 8

9 Table 3: The urban dimension of Europe 2020 Policy objectives Territorial focus Promoting exchange of knowledge and experience Awarding good practices SMART GROWTH Smart Specialisation Strategies Innovative application of integration of energy, transport and ICT technologies Investing in culture Accessibility of retail services SUSTAINABLE GROWTH 7 th Environmental Action Programme Sustainable urban planning & design Tackling air pollution Urban areas exceeding EU air quality standards Smart Cities and Communities EIP European Capitals of Culture European heritage label Green infrastructure solutions European Cities European Green Capitals Award Climate change mitigation measures (clean urban transport, energy efficiency, limiting urban sprawl) Climate change adaptation measures (sea level rise, high temperatures, extreme weather events) Energy efficiency in urban transport, public infrastructure, district heating, buildings Sustainable urban mobility plans Deliver on the EU climate objectives through the use of Information and Communication Technologies (ICT) INCLUSIVE GROWTH Tackling spatial segregation in terms of access to quality public services Eliminating substandard housing Tackling health inequalities Active inclusion Partnerships with employers Decreasing early school leaving Services for childcare and dependants Metropolises SMCs for skills and capacity building Coastal cities, Large cities in South, Cities along main rivers Cities in EU13 Small & medium size cities (SMCs) Cities Connections between centre and suburbs HU, SK, RO, BG, PL, CZ, LV Migrants, marginalised communities Covenant of Mayors ELENA facility CIVITAS award Green Digital Charter 9

10 4. Maps and tables Map 1: Population density in Europe, 2001 Note: Colours and peak heights represent population density by 1 km2 raster cells. Sources: Eurostat, JRC, EFGS, REGIO-GIS. Table 4: Population share by degree of urbanisation in %, EU-15 Cities Towns and suburbs Rural areas Total EU-13 Cities Towns and suburbs Rural areas Total EU-28 Cities Towns and suburbs Rural areas Total Note: Only partial data for Portugal and Slovenia Source: Time series of LAU2 population data, NSI, DG REGIO / Spatial Foresight 10

11 Table 5: Population by degree of urbanisation in the EU-28, 2011 Degree of urbanisation Population Number of cities* absolute in % Rural areas Towns and suburbs** 155,900, Cities* 203,078, Cities* by urban centre size ,067, ,494, ,336, ,104, > ,076, Total EU ,432, * Cities with an urban centre of inhabitants or more ** Towns and suburbs have the majority of their population in an urban cluster of inhabitants or more and do not have an urban centre of at least inhabitants Source: European Commission (JRC, EFGS, DG REGIO). 11

12 Map 2 Population size and density of major cities in Europe (2006) Note: Population and density calculated for an area corresponding to a radius of 15 Km around each city centre. Elaboration: JRC/REGIO 12