The Role of the Cities in the Baltic Sea Region and Europe

Lord Mayors, Mayors, Excellencies, Ladies and Gentlemen,
 
During the Baltic Development Forum summit in September last year, Finland’s former Prime Minister Paavo Lipponen told straight and forthright that: ”As long as we don’t have working markets, Europe will never be as competitive as the United States”.
 
Truth can sometimes be short and easy to speak but its echo is everlasting.
 
And let me tell you, those words echoed for a long time in the University of Hamburg, which served as last year’s summit venue.
 
Every European has a share of responsibility to realise Europe’s enormous potential. If we fail to realise Europe’s potential, we risk undermining the trust on which the whole Union depends. This is serious business and the cities and regions of Europe have a huge responsibility in this regard.
 
You can secure continuity from policy development - to policy delivery - by delivering a modern, effective, low-cost and service-minded administration.
 
The cities of Europe are indeed drivers of regional prosperity and if you succeed in delivering a world-class administration, you have a real opportunity to narrow the economic gap between yourself and cities in other parts of the world.
 
What you achieve, what you do, the scale and type of development you deliver. It all has an enormous effect on the societies of the Baltic Sea!
 
It affects our economic growth and private sector employment. It affects our over-all competitiveness and innovative capabilities. And it affects our reputation and standing in Europe and globally.
 
I intend to listen very carefully this afternoon when the Mayors will discuss the cities’ role in regional development. It will indeed be very interesting because, you, the cities, must actively help define joint ambitions for the region and put them into action. You have an important task in formulating strategies and implementing regional action agendas that can strengthen the region’s competitiveness and innovative potential.
 
Baltic Development Forum has with a number of different stakeholders already launched an initiative that, hopefully, can help us do that. We have called our regional endeavour: The Baltic Sea Initiative 2010.
 
The Baltic Sea Initiative is a stakeholder driven initiative aimed at reinforcing and profiling the Baltic Sea region. The outcome of the Baltic Sea Initiative 2010 will be presented during the next Baltic Development Forum summit, which is co-organised with the Swedish innovation agency, Vinnova, and the City of Stockholm. The summit will be held on 16-18 October this year.
 
During the summit, Baltic Development Forum intends to focus on the role of the cities in the future. And why not even organise a back-to-back event between the Baltic Metropoles and Baltic Development Forum? Back-to-back events would ensure even greater synergy between our two organisations.
 
Copenhagen, Hamburg, Helsinki, Malmö, Riga, Stockholm and Tallinn are already members of the Baltic Development Forum. We invite the rest of you to join us as well. Your involvement in putting the Baltic Sea Initiative into action is crucial and I invite you to speak your hearts when discussing how and when we should do it.
 
You are also important for the success of the EUs Lisbon Agenda.
 
Strengthening the Lisbon process must remain a top priority for the Union the next five years. For too many years, the ambition of Europe to become the world's most dynamic economy turned into a tale of missed objectives and failed promises.
 
Therefore, I was more than delighted when José Barroso became President of the European Commission. I knew he could give the necessary boost to the work of the Commission and the Lisbon agenda.
 
I remember him from when he was a very young Foreign Minister in the early nineties. He has since had a great career. He will become a great President for our Union.
 
Speaking to the European Parliament in Brussels, Barroso set out his vision for the strategic objectives for the European Union until 2010. He said very clearly that Europe must restore sustainable dynamic growth in accordance with the Lisbon strategy. That would be his top priority for the next five years.
 
To those who denounce Barroso's priorities, I say what else can he do with a German unemployment at a new post-World War II high? In January, a record 5 million German people were out of work, pushing the jobless rate to more than 12 percent. Putting growth and job creation ahead of welfare is something Europe needs to do.
 
José Barroso’s re-invigorated and re-focused Lisbon Agenda is clear and honest. And it has a real possibility to put Europe back on track. I cannot stress how important it is that we support President Barroso in his efforts to release Europe’s enormous untapped potential.
 
You could say that the Baltic Sea Initiative is our humble attempt to help along because if we fail this time around, we will never become as competitive as the United States.
 
You might wonder why I mention the United States? I do it because it is often a good idea to look to one’s competitor in order to improve one’s business.
 
Just like Paavo Lipponen did at the summit in Hamburg.
 
So, let’s take a look at what made the United States so successful when it comes to innovation and competitiveness. And why not look to its cities and their ability to serve as drivers of the whole American society.
 
Throughout history, the United States has built great cities. Some of them are indeed real metropolises. Industrialization brought with it urban centres, that became places of limitless opportunity for the many new citizens of the growing American society. The American cities became a near symbol of the American Dream during the 20th century.
 
The American cities attracted top scientific, artistic and entrepreneurial talent from around the world. And by attracting the best and brightest citizens from Europe, Asia, Africa, India and all countries of the world, the cities help keep the American economy on track for years.
 
As a result, the United States remains a global leader in innovation and technology development.
 
However, our cities, here in Europe, were also drivers of the industrial revolution. And you can once again become drivers of the new opportunities created by globalisation, the fall of the Iron Curtain and the enlargement of the European Union.
 
Those events have given our cities a new opportunity to develop into places where global opportunities can be turned into local prosperity.
 
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 only investments in soft values can attract a society’s so-called “talent pool”.
 
The growing class of creative employees is the basis for Florida’s theory. These are people whose economical function is to be innovative, create new technologies or new creative content. They include 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 in today’s globalised world.
 
Richard Florida, of course, has a very important point. On the other hand, Florida’s theory also has it shortcomings.
 
The IT revolution of the 1990's put a lot of emphasis onto these new creative and innovative employees. However, we know that those cities that put all their efforts into attracting this type of employees have high unemployment rates today.
 
Quality of life is important to ensure economic growth and investments in every city - but today’s talent mass is not only found among the young and the trendy.
 
Professor Florida – like so many politicians - fails to notice this fact.
 
Richard Florida’s soft characteristics are important but we cannot disregard the necessity of hard characteristics - such as well-developed infrastructure and skilled production workforces. At the same time, the costs associated with locating businesses remain very important.
 
My point is that no city will be able to offer everything. And no city should offer everything.
 
However, a region like the Baltic Sea region must be able to offer it all in order to compete globally. And actually we already do.
 
Take for example Estonia, Latvia, Lithuania and Poland. Baltic Development Forum’s State of the Region Report 2004 showed that the reform process and a new generation of skilful leaders helped create strong management methods and modern manufacturing.
 
The availability of scientists and the access to research institutions and venture capital is also relatively high. At the same time they have less costly production sites than most other European countries.
 
On the other side of the Baltic Sea, you have the Scandinavian countries.The Scandinavian countries benefit from high productivity and a high level of employees per capita. Germany falls behind mainly because of higher unemployment but performs strong on research and development - together with its Nordic neighbours.
 
What we need to do is to turn our differences into strengths.
 
The cities of the Baltic Sea are indeed very different but put together you comprise an area of rich culture, good environment, friendly atmosphere, well-developed infrastructure, skilled production workforces - and some places, even, low taxes.
 
We must continue to strive to provide the highest quality of life for those residents and businesses that call the cities of the Baltic Sea region their home. By doing so, we might develop real metropolises around the Baltic Sea area. Those metropolises could serve as a driving force in making the European markets work so that Europe can become as competitive and innovative as the United States
 
I take this opportunity to call for coordinated action and support for the Baltic Sea Initiative and all other initiatives that support the development of the Baltic Sea region and the European Union’s Lisbon agenda.
 
The Baltic Sea region has grown into Europe’s innovative growth region. Let’s keep it that way.
 
Let’s spread growth and prosperity to every community, every area and every sub-region in the Baltic Sea area. Let’s take good care of this great region and leave it to our children and grandchildren in an even better shape than today.
 
Thank you.