By Uffe Ellemann-Jensen,
Chairman of Baltic Development Forum, former Danish Minister for Foreign Affairs
The Business Forum of the Greater Copenhagen Authority
October 21, 2003, 1:20PM, Hotel Hilton, Copenhagen Airport
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(Original speech was held in Danish)
Mayor and Chairman Mads Lebech, Chairman of the Business Forum, Flemming Lindeløv, Director Claes Nilas,
Ladies and Gentlemen,
The economist and futurologist George Gilder, who has researched the IT revolution of the 1990´s, some years ago predicted that cities, as institutions in our society, would quietly become instinct within a not too distant future.
There is some truth to this prediction. But I also think it is somewhat exaggerated.
The truth is somewhere in between.
I believe, that initiatives like the new business strategy for the metropolitan area can defy the doomsday prophecy of George Gilder.
And I hereby thank you for your invitation to discuss it together. A new and common understanding of how a metropolitan area like Copenhagen should develop its business policies is, of course, important for the ability to compete.
And the ability to survive lies in the ability to compete.
The Copenhagen metropolitan area is today one of the most dynamic areas in the Baltic Sea Region.
As both a center of growth and as a metropolis the Copenhagen Metropolitan area contributes to wealth and development. Not only in Zealand, but also to Denmark as a whole, the Sound and the rest of the Baltic Sea Region.
We see that in the Baltic Development Forum, which welcomes the city of Copenhagen as one of its members. Our neighbor today – just on the other side of the road – Copenhagen Airport - is actually also a member...
The Baltic Development Forum has grown to become the most important network forum of the Baltic Sea Region. Our members consist of businesses, organizations and cities, which all know how important their participation is in setting a new and visionary agenda for the Baltic Sea Region. Not only for their own benefit, but because they all have something to offer to the development of the Baltic Sea Region.
Baltic Development Forum operates at all decision levels and within all sectors. And there is no doubt that the Copenhagen Metropolitan Area has strong points in its location, its size and its areas of competence.
I would like to take this opportunity to tell you: The competition is fierce. You are not alone. And do not make the mistake of proceeding with the illusion that only your local area is important.
Not least metropolises like Oslo, Stockholm, Helsinki and Riga, who are all similar to Copenhagen in size, will fight for the title as the most attractive metropolis of the Baltic Sea Region.
Add to this Hamburg, which in size and development potential actually surpasses the smaller metropolises I just mentioned. Hamburg also happens to be one of our members, just like Riga and Stockholm - and as I said before, Copenhagen.
Also, I would like to mention Berlin, Warsaw and St. Petersburg.
Today these three metropolises are not a threat to the smaller metropolises. But there is no doubt that their location forms a triangle with significant business potential.
I think we need to realize that not all the participants we know today will survive in the future. You must cooperate on all reasonable levels and where you can benefit from each other’s scope of competency.
Professor Richard Florida of the Carnegie Mellon University in Pittsburgh, Pennsylvania, is the author of the book "The Rise of the Creative Class". He writes that it is mainly soft characteristics such as culture and atmosphere that persuades people and businesses to relocate to a new place.
The reason is that talent is the most important resource in today’s society and that only investment in soft values can attract a society’s talent pool.
The growing class of creative employees is the basis for Florida’s theory.
These are people whose economical function is to have ideas, create new technologies or new creative content, including scientists, architects, designers, musicians, artists and engineers.
According to Richard Florida it is the ability to meet the needs and lifestyle of this creative class that makes the difference between winners and losers today and tomorrow.
There is a point to Richard Florida’s theory. On the other hand, it also has it shortcomings.
The IT revolution of the 1990's caused a lot of emphasis onto these new creative employees. But today we see that cities that put all their effort into attracting this type of employees have a very high unemployment rate (ex. San Francisco, lower Manhattan and Seattle’s Bell town).
Quality of life is of course also important to ensure economic growth and investments in a certain region, but today’s talent mass is not only found among the young and hip. Professor Florida overlooks this.
Apart from this we cannot disregard the necessity of hard characteristics such as a well-developed infrastructure, skilled production workforce, but also the costs associated with locating a business to a certain region.
One cannot expect any one city to be able to offer everything but the surrounding region must be able to offer it all.
The ability to cooperate with the surrounding metropolises in order to create and attractive investment area makes the difference between winners and losers now and in the future.
Richard Florida does not mention these facets although they are still important in today’s business. Which is obvious when we look at other regions such as the Mediterranean, California, the ASEAN countries and the southern regions of China.
I purposely mention the Mediterranean, California, the ASEAN countries and China to force you all to not just consider the competition between the metropolises of the Baltic Sea Region.
We must think globally! Because we compete globally!
I think that Copenhagen and southern Sweden are making a mistake in believing that it is sufficient to position the Oresund Region in the global marketplace.
Regardless of how we measure it, the Oresund Region is not even close to Hamburg, for instance.
Therefore Copenhagen, Stockholm and Hamburg should jointly define in which areas it would be beneficial and profitable to cooperate.
Oslo, Helsinki and Riga could easily be persuaded to join in if a development of common strategies in meaningful areas was to be initiated.
Berlin, Warsaw and St. Petersburg would gladly welcome a common growth plan.
But it is important that someone takes the lead and shows the way to cooperation between the metropolises of the Baltic Sea.
Copenhagen, Stockholm and Hamburg could become the natural leadership of this cooperation – and it would be our pleasure if the Baltic Development Forum would be used as a platform.
That does not mean that the metropolises should not compete internally, but that some form of coordination should exist so that the Baltic Sea Region appears to be one investment area with a complete set of opportunities. We must not forget that we are up against growth areas like the Mediterranean Area, California, ASEAN countries and the so-called "powerhouse" in southern China.
I have, however, no doubt that the Baltic Sea Region is a worthy competitor if we stand together like one region.
To me it is important to look at history to figure out what makes a region appealing to people outside the region.
And our region does have a tradition of cooperation.
Apart from the 20th century, where the Baltic Sea Region more than any other region was challenged by Great Power rivalry, we have a tradition of trade and cooperation.
It was obvious to those who came here during the Middle Ages. From the 11th Century to the 13th, a time of growth was started that we can learn from even today.
The merchants of the north German cities depended upon this trade and gradually they developed a cooperation to protect free trade.
From this cooperation grew the Hanseatic League, seen first in the early 12th Century and which also included Bergen, London, Bruges and Novgorod.
The Hanseatic League never became a nation or a proper state but remained a loose union of cities that bonded together using meetings and Hanseatic Days to discuss common problems and challenges in a peaceful manner.
Especially in the middle of the 14th Century the Hanseatic League completely set the agenda for the economy and policy of the region.
I think we can learn from the Hanseatic League, but we also need to understand why it collapsed.
The cause of the collapse was that as time went by, the Hanseatic League was no longer competitive. And as the competitiveness went from bad to worse, the cooperation went the same way, which then reflected onto the growth of the hanseatic cities.
During the 15th Century the Dutch gained more of the sound ferrying and the Baltic Sea trade and in 1494, when the Russian Tsar closed the hanseatic office in Novgorod, the hanseatic period was over.
What we can learn from the hanseatic period must be that: As long as the cooperation was active and ongoing and the advantages of the Baltic Sea were exploited the region stayed very competitive.
Therefore, my vision is crystal clear: We must create a Single Market of the Baltic Sea!
With the EU expansion in May we are breaking down trade barriers between the eight new EU member countries in the region and our task is to secure that new ones are not created between the eight and the two countries outside the EU, Norway and Russia.
Therefore, the road to an expanded Single Market is for us to support Russia’s ambitions to a membership of the WTO – and simultaneously help the new member countries integrate in the EU Single Market.
Once this has happened, I think there will be enough momentum to implement a new plan, hardly indistinguishable from (former President of the European Commission) Jacques Delors’ White Paper on the EU’s Single Market.
Only this time it is Russia that must harmonize and adjust its commercial legislation to the EU.
During Baltic Development Forum's summit earlier this month we also defined which areas the Baltic Sea Region as whole should prioritize in the future.
Areas that should be developed and researched are:
· Information and communication technology;
· Transport and infrastructure;
· All areas within health care;
· Energy and environment and -
· Tourism.
Within these sectors we are already at the cutting edge of the development.
The outside world seems to know of our advantages in these areas. But in order to make the Baltic Sea Region more interesting on a global point of view, we must prioritize these areas to an even larger extent than before.
Also, the Russian Baltic Sea exclave, Kaliningrad, which from May of next year will be completely surrounded by the EU, when Lithuania and Poland becomes members, was the object of attention at the summit in Riga.
At the summit a number of subjects emphasizing the economical and social conditions in Kaliningrad were discussed and it was also pointed out that time has now come to turn the good intentions into action.
Baltic Development Forum was asked to consider taking on the task to coordinate some of the different efforts to establish a strategy for Kaliningrad and is seriously considering doing so.
At the summit, I myself mentioned that we must try to define the common ground between EU and Russia in the attempts to do something constructive and of lasting value for Russia and Kaliningrad.
And allow me to emphasize in present company: It is not worthy, neither for Russia or the EU nor for the rest of the Baltic Sea countries to close their eyes to the problems of Kaliningrad.
The metropolises of the Baltic Sea Region have a mission in the planning of this cooperation – along with the Baltic Development Forum – should the governments and the European Commission fail.
Kaliningrad could become a strategically important metropolis to the entire Baltic Sea Region in the future. – A door to the entire Northwest Russia.
I know that St. Petersburg has already acknowledged its responsibility concerning Kaliningrad. But St. Petersburg can hardly help Kaliningrad on its own. And probably has no desire to do so…
To take on responsibilities of this kind could be a way for a metropolis like Copenhagen – or Stockholm, Hamburg or Riga – to show its worth!
The Baltic Sea Region is, as mentioned, a worthy competitor to other leading regions. But we need to focus and prioritize - on our own and together.
Ladies and Gentlemen,
From October 5-7, when Riga for three days was the capitol of the Baltic Sea Region during Baltic Development Forum's summit there was no doubt among politicians, business leader and researchers.
They agreed: The Baltic Sea Region will be Europe’s new Smart Region.
The road to this goal is through controlled leadership, hard work and clever competition, - but also through well thought out and visionary cooperation in those areas where we are stronger when united.
The metropolises of the Baltic Sea Region undoubtedly have an important task ahead in shaping and improving the cooperation of our region. That is why I don’t believe in doomsday prophecies, like cities becoming extinct in the society of the future.
A new and common understanding of how a metropolitan area like Copenhagen should develop its business policies will ensure the survival of the cities.
Because the ability to survive lies in the ability to compete.
Thank you.
