036_LOCAL AND REGIONAL DEVELOPMENT_2017_665

DINA VAIOU

Figure 39.3 Kypseli, Athens: public event in the Agora
Source: Author’s image

an emblematic place in their neighborhood terms of autonomous presence within these
(Figure 39.4). In their narratives, the square flows, thereby challenging representations of
of their memories comes out as a different “the migrant” as a man, young, economically
place where a complex mix of languages, active, moving alone. Approaches which
music rhythms, smells and bodily appear- integrate women’s experiences and gender
ances are encountered, gradually tolerated perspectives question the ways in which
and often positively appreciated. Bodily migration as a global set of processes can be
presence and common daily practices con- understood. Such approaches also question
tribute to contact and familiarization with in different ways established understandings
“others” – which in turn mobilizes (infor- of local development and point to some
mal) processes of networking, mutual sup- “hidden” aspects of local/global links which
port and, perhaps eventually, integration. require a multi-scalar perspective. Decisions
Here the practices of women and men are to migrate are part of complex migration
distinctively different and imply a multiplic- projects which involve people and house-
ity of relations initiated and organized around holds/families in different countries and
shared experiences and practices of caring. important negotiations of gender power,
which are linked to the changing spatialities
Gendering migrant settlement of migrant households.

The numerous presence of women in recent Between global restructurings, countries
migration flows is by now well documented, and individuals, families are constituted as
both in terms of general numbers and in dispersed in different places, support networks
are formed in neighborhoods, integration
478 mechanisms are devised, linked to (micro)

GENDER, M IGRAT I O N A N D SOC IO-S PATIA L TR AN S FOR MATION S

Figure 39.4 Kypseli, Athens: the main square (2007).
Source: Author’s image

spatial scales and collective action. In these among locals. The minutiae of everyday life,
processes, migrant women’s involvement and the different involvement of women and
emerges as quite distinct from that of men. men, permit a clearer view of the gendered
The absences and presences of migrant men aspects of migrant settlement, in which
point to lives more focused around paid work power is enacted but also resisted. Attention
and disconnected from the caring aspects of to these gendered aspects reveals different
everyday life. Women’s invisible and under- dynamics of local development and of the
valued everyday activities on the other hand changing spatialities of everyday life across
contribute to constitute “familiar places” places and borders, which constitute slow but
within Southern European cities and play an deep challenges for local development. To
important role in transformations and devel- what extent such patterns may survive the
opments both “here” and “there”.Their eve- deepening economic crisis is an open question
ryday and longer term practices related to for Southern European cities and societies.
paid work, housing, household provisioning,
populating public spaces and services and References
networking account to a large extent for the
revitalization of urban neighborhoods which Andall, J. (2000) Gender, Migration and Domestic
were on the verge of being devalued. Service. The Politics of Black Women in Italy,
Aldershot: Ashgate.
The organization of care, characteristic of
the Mediterranean model, reveals important Aramburu, M. (2002) Los otros y nosotros: Imágenes
sites where masculinities and feminities are del inmigrante en Ciutat Vella de Barcelona,
negotiated personally and socially, among Madrid: Ministeio de Educación, Cultura y
migrants, between migrants and locals, and Deporte.

479

DINA VAIOU

Bagavos, Ch. and Papadopoulou, D. (eds) (2006) Iosifidis, T. and King, R. (1998) “Socio-spatial
Migration and Integration of Migrants in Greek dynamics and exclusion of three immigrant
Society,Athens: Gutenberg (in Greek). groups in the Athens conurbation”, South
European Society and Politics, 3:3, 205–229.
Becattini, G., Bellandi, M., dei Ottati, G. and
Sforzi, F. (2003) From Industrial Districts to King, R., Lazaridis, G. and Tsardanidis, C. (eds)
Local Development. An Itinerary of Research, (2000) Eldorado or Fortress? Migration in Southern
Cheltenham: Edward Elgar. Europe, London: Macmillan.

Bettio, F. and Plantenga, J. (2004) “Comparing Labrianidis, L. and Lyberaki, A. (2001) Albanian
care regimes in Europe”, Feminist Economics, Migrants in Thessaloniki. Trajectories of Prosperity
10:1, 85–113. and Oversights of the Public Image, Thessaloniki:
Paratiritis (in Greek).
Bettio, F., Simonazzi,A. andVilla, P. (2006) “Change
in care regimes and female migration: the Leontidou, L. (1990) The Mediterranean City in
‘care drain’ in the Mediterranean”, Journal of Transition, Cambridge: Cambridge University
European Social Policy,16:3, 271–285. Press.

Campani, G. (2000) Genere, etnia e classe, Pisa: Macioti, M.I. and Pugliese, E. (1991) Gli immigrati
ETS. in Italia, Bari: Laterza.

Castles, S. and Miller, M. (1993) The Age of Malheiros, J. (2000) “Urban restructuring, immi-
Migration. International Population Movements in gration and the generation of marginalized
the Modern World, London: Macmillan. spaces in the Lisbon region”, in R. King, G.
Lazaridis and C. Tsardanidis (eds) Eldorado or
Cattedra, R. and Laino, G. (1994) “Espaces d’ Fortress? Migration in Southern Europe, London:
immigration et formes urbaines: considéra- Macmillan, 207–232.
tions sur le cas de Naples”, Revue Européenne
des Migrations Internationales, 10:2, 175–185. Martinez Veiga, U. (1998) “Immigrants in the
Spanish labour market”, South European Society
Coppola, P. (1999) “Nuovi abitanti, nuove mixité. and Politics, 3:3, 105–128.
Napoli: tracce di una città meticcia”, in Brusca
(a cura di) Immigrazione e multiculturalità nell’ Martori, J., Hoberg, K. and Suriñach, J. (2005)
Italia di oggi, Milano: F.Angeli, 414–422. “Segregation measures and spatial autocorre-
lation. Location patterns of immigrant minor-
Elordui, Z. and Cladera, J. (2006) “Residential ities in the Barcelona region”, paper presented
mobility and foreign immigration settlement at the 4th Congress of the European Regional
in the Metropolitan area of Barcelona”, paper Science Association, Vrije Universiteit
presented at the 6th Urban and Regional Amsterdam.
Studies Conference, Roskilde, Denmark.
Morini, C. (a cura di) (2001) La serva serve.
Emmanuel, D. (2002) “Housing conditions in Le nuove forzate del lavoro domestico, Rome:
Greater Athens”, Geographies, 3, 46–70 (in Derive-Approdi.
Greek).
Papataxiarchis, E., Topali, P. and Athanasopoulou,
Fullaondo, A. and Elordui, Z. (2003) Análisis de A. (2008) Worlds of Domestic Labor. Gender,
la distribución territorial de inmigración extranjera Migration and Cultural Transformations in Early
en Barcelona, Barcelona: Centre de Política de 21st Century Athens, Athens: University of the
Sól i Valoracions (CPSV). Aegean (in Greek).

Garcia Armand, A. (2005) “El rol de las mujeres Parella Rubio, S. (2003) Mujer, inmigrante y traba-
en el devenir de un barrio intercultural: el jadora, La triple discriminación, Barcelona:
Raval de Barcelona”, in M. Nash, R.Tello and Anthropos.
N. Benach (eds) Inmigración, género y espacios
urbanos. Los retos de la diversidad, Barcelona: Pavlou, M. and Christopoulos, D. (eds) (2004)
edicions Bellaterra. Greece of Migrants. Social Participation, Rights
and Citizenship, Athens: Kritiki and KEMO
Germain, A. (2000) Immigrants and Cities: Does (in Greek).
Neighbourhood Matter?, Montréal: Institut
National de la Recherche – Urbanisation, Peraldi, M. (2001) Cabas et containers. Activités
Culture et Société. marchandes informelles et réseaux migrants trans-
frontaliers, Paris: Maisonoeuvre at Larose.
Hadjimichalis, C. (2006a) “Non-economic
factors in economic geography and in Pugliese, E. (2002) L’Italia tra migrazioni internazi-
‘new regionalism’: a sympathetic critique”, onali e migrazioni interne, Bologna: il Mulino.
International Journal of Urban and Regional
Research, 30:3, 690–704. Reyneri, E. (1998) “The role of the underground
economy in irregular migration to Italy: cause
Hadjimichalis, C. (2006b) “The end of Third Italy or effect?”, Journal of Ethnic and Migration
as we knew it?”, Antipode, 38:1, 82–106. Studies, 24:2, 313–331.

480

GENDER, M IGRAT I O N A N D SOC IO-S PATIA L TR AN S FOR MATION S

Ribas, N. (1999) Las presencias de la immigración Further reading
femenina. Un recorrido por Filipinas, Gambia y
Marruecos en Catalunˇa, Barcelona: Icaria- Anthias, F. and Lazaridis, G. (eds) (2000) Gender
Antrazyt. and Migration in Southern Europe, Oxford: Berg.
(One of the first collections of essays on gender
Schmoll, C. (2001) “Immigration et nouvelles and migration with a Southern European
marges productives dans l’ aire métropolitaine focus.)
de Naples”, Bulletin de l’ Association des
Géographes Français, 76:4, 403–413. Dyck, I. and McLaren, A. (2004) “Telling it like
it is… Gender, place and multiculturalism
Schmoll, C. (2008) “Naples dans les mouvements in migrant women’s settlement narratives”,
migratoires: une interface Nord-Sud?”, Bulletin Gender, Place and Culture, 11:4, 513–534.
de l’ Association des Géographes Français, 83:3, (A reflection on methodological issues and
313–324. knowledge production related to gender and
migration.)
Smith, N. (1996) The New Urban Frontier.
Gentrification and the Revanchist City, London: Green, N. (2002) Repenser les migrations, Paris:
Routledge. Presses Universitaires de France. (Analysis of
migrations, with interesting comparisons
Solé, C., Ribas, N., Bergalli,V. and Parella, S. (1998) between France and the USA and a chapter
“Irregular employment amongst migrants in about the passage from “the migrant (man)” to
Spanish cities”, Journal of Ethnic and Migration “the migrant (woman)”.)
Studies, 24:2, 333–346.
Häussermann, H., Siebel, W. (2001) “Integration
Tastsoglou, E. and Hadjicostandi, J. (2003) “Never and segregation. Thoughts on an old debate”,
outside the labour market, but always outsid- Deutsche Zeitschrift für Kommunalwissenschaften,
ers: Female migrant workers in Greece”, 40:1, 125–138. (A discussion on the role of
Special Issue: Gender and International Migration: integration policies and their effects on urban
Focus on Greece (E.Tastsoglou and L. Maratou- neighborhoods.)
Alipranti, eds), The Greek Review of Social
Research, 110A, 189–220. Kearns, A. and Parkinson, M. (2001) “The sig-
nificance of neighbourhood”, Urban Studies,
Vaiou, D. (2002) “In the interstices of the city: 38:12, 2103–2110. (An analysis of the sig-
Albanian women inAthens”,Espace,Populations, nificance of the much debated concept of
Societes, 3, 373–385. “neighborhood”.)

Vaiou, D. (2006), Analysis of Demand for Female Quassoli, F. (1999) “Migrants in the Italian under-
Migrants’ Labour. The Greek Case [online], ground economy”, International Journal of
FeMiPol Working Paper GR-WP 4.1, at: Urban and Regional Research, 23:2, 212–231.
www.femipol.uni-frankfurt.de. (A discussion of the role of informal activities
on migrant settlement in Italy.)
Vaiou, D., Bacharopoulou, A., Fotiou, Th.,
Hatzivasileiou, S., Kalandides, A., Karali, M., Silvey, R. (2006) “Geographies of gender and
Kefalea, R., Lafazani, O., Lykogianni, R., migration. Spatializing social difference”,
Marnelakis, G., Monemvasitou, A., International Migration Review, 40:1, 64–81.
Papasimaki, K. and Tounta, F. (2007) Intersecting (A review of the contribution of geography to
Patterns of Everyday Life and Socio-spatial gender and migration research.)
Transformations in the City. Migrant and Local
Women in the Neighbourhoods of Athens, Athens:
L-Press (in Greek).

Vaiou, D. and Hadjimichalis, C. (1997/2003) With
the Sewing Machine in the Kitchen and the Poles
in the Fields. Cities, Regions and Informal Work,
Athens: Exandas (in Greek).

481



Section VI

Global perspectives



40

The experience of local and regional
development in Africa

Etienne Nel

Introduction proven to be significant obstacles to develop-
ment and major inducements to policy-makers
The recent history of local and regional to implement appropriate responses (Konadu-
development in Africa has been one marked Agyemang and Panford, 2006). Colonialism
with experiences ranging from disappoint- divided Africa into a series of artificial depend-
ments and desperate attempts to cope with encies which cut across pre-existing tribal
the effects of marginalization to ambitious borders and imposed a system of resource
supranational programmes and efforts to extraction within the broader context of an
achieve unique forms of ‘African develop- International Division of Labour (Griffith,
ment’. From the outset it is important to 1995; Niang, 2006). The initial optimism of
point out the complexity and diversity the post-Second World War independence
which characterizes Africa, which was, as of era and the pursuit of both pan-Africanism
November 2009, home to over one billion and various ‘grand development’ schemes
people living in 54 different countries (BBC, was sadly curtailed by the 1980s debt crisis,
2009). These countries range from some of maladministration, corruption and the mar-
the world’s poorest such as Chad and Malawi ginal role Africa now plays in the global
through to relatively affluent middle-income economy, which has since been compounded
countries such as South Africa and Mauritius by the negative effects of trade liberalization,
which are experiencing sustained economic low growth rates in commodity prices and
growth and integration into the global econ- currency devaluation (Griffith, 1995). The
omy (Ayeni, 1997). Significant language, reli- fact that Africa has the fastest growing popu-
gious and cultural differences and the existence lation rates in the world has not aided matters
of governments which range from at least in countries which are experiencing mini-
one case of an absolute monarchy, to military mal levels of economic growth, while the
states and true democracies complicate the devastating effects of AIDS is severely straining
picture and prevent the drawing of uniform fragile economies and government resources.
conclusions. In the view of Griffith (1995: 191) ‘Africa is
the most disadvantaged continent in terms
Africa’s recent past has clearly been one of of poverty, political unrest, quality of life and
the most traumatic on the planet. Economic human suffering’. As a result the potential
collapse, debt, corruption and disease have
485

ETIENNE NEL

value of well-formulated local and regional The pre-independence and
development it is apparent. early independence eras
in Africa, 1950–1980s
At a continental level,Africa in the twenty-
first century faces both enormous challenges European colonialism imposed an artificial
and opportunities. It has some of the richest division of space on the pre-existing tribal
mineral resources in the world and there is a kingdoms of Africa. Empires such as the
very strong sense of regional identity which Ashanti and Monomotapa, which were
has led to the formation of several key regional regional in extent, and which had developed
political and economic unions.Within coun- regional trading routes within African and
tries, the Washington Census (the World Bank with the Middle East were subsumed in a
and IMF’s concepts of state economic man- European order which divided the continent
agement) has curtailed previous forms of into European ‘spheres of influence’ (Best and
state intervention while larger ‘regional’ de Blij, 1977; Griffith, 1995). That ‘develop-
initiatives within countries are very much on ment’ did take place is undeniable; however,
the back-burner.Themes of decentralization this often took the form of linking the colony
and community empowerment have become to the mother country through defined sys-
a hallmark of the survival endeavours of tems of transport and resource abstraction,
marginal towns and communities, often with which made once economically independ-
direct reliance on the NGO sector for support. ent areas dependent on external economies
Its is apparent that significant policy and for inputs, jobs, products and even food, as
strategic changes are taking place in Africa; economies were restructured, often becoming
however, it seems that ‘the current regional mono-economies to supply products such as
trend in Africa has received little scholarly cotton (from the Sudan) and copper (from
attention especially in a systematic and com- Zambia) to Europe (Ayeni, 1997; Makinda
prehensive way. This is due partly to the and Okumu, 2008). Regional development
fact that the processes are currently unfold- in the sense of the creation of industrial-
ing and there is still uncertainty in the out- mineral and commercial-agricultural com-
comes’ (Adejombi and Olukoshi, in Cambria plexes was a hallmark of this period with the
Press, 2008). granting of lands to European settlers and
companies and significant state and private
This chapter overviews Africa’s experi- investment in key industrial-mineral com-
ences in regional and local development over plexes. Examples include tea production in
the last 60 or so years. It starts with a brief the Kenyan Highlands, cotton production in
review of the pre-Independence scenario the Sudan,tobacco in what is now Zimbabwe
before focusing on national development and cocoa in West Africa. Key mineral-
schemes and pan-Africanism as pursued in industrial nodes include the Witwatersrand
the 1950s through to the 1970s. Following in South Africa, once the wealthiest gold-
what has been referred to as the ‘lost decade’ producing area in the world, the Copperbelt
of the 1980s in Africa, as a result of the debt complexes in what are now Zambia and the
crisis and structural adjustment, focus shifts Congo and the industrial cities of present-
to look at recent pan-regional initiatives, day Zimbabwe (Best and de Blij, 1977).These
national policies and various local coping complexes were all linked to large, purpose-
strategies. Given the shear size and complex- designed ports with dedicated high-volume
ities of the continent and its 54 countries it rail linkages (Davidson, 1994; Griffith, 1995).
is impossible to capture the micro-detail of An examination of historical railway maps
what is happening in each country; rather of Africa provides insight into the nature of
emphasis is placed on generic themes and this historical, extractive economy and its
the examination of specific illustrative cases
as appropriate.

486

THE EXPERIENCE OF LOCAL AND REGIONAL DEVELOPMENT IN AFRICA

selective influence on the continent.The dense Kaunda in Zambia and Nyerere in Tanzania.
rail network in industrialized South Africa In parallel, other countries and regimes, such
stands in contrast to the effective absence of as Kenyatta’s Kenya chose to pursue more
any rail connectivity in poorly developed Western market-based development strategies
Chad,while in countries such as Mozambique often with equally limited success (Davidson,
and Angola, short unconnected railway lines 1994;Ayeni, 1997).
link ports to single resource supply zones in
the interior (Davidson, 1994). In this era the local state tended to have
few powers of direct decision-making. Key
At the international scale, the concept of powers rested with the central state which, in
‘spheres of influence’ in the British, French, most cases, actively strove to develop national
Portuguese, Spanish and German parts of the assets, often through targeted spatial develop-
continent led to the formation of close cross- ment schemes. Some of the most apparent
border trade and administrative links which include significant investment in capital cities
was most noticeable in French West Africa and in certain cases the creation of brand-
where two Federations were formed under new administrative capitals with Dodoma in
French rule. Later in the British sphere the Tanzania, Lilongwe in Malawi and Abuja in
Central African and East African Federations Nigeria being the most obvious. Investment
were formed (Best and de Blij, 1997; Griffith, in airports, sports stadia and administrative
1995; Konadu-Agyemang and Panford, 2006). complexes has created artificial pseudo-
At the time of Independence Africa was left western cities in what are often some of the
with highly skewed and dependent economies, poorest countries on the planet.The redevel-
characterized by what were often mono- opment of Abidjan in Ivory Coast is a case in
economies, dependent on European trade point under the rule of Houphouet-Boigny
and economic linkages, and weak and poorly (Bell, 1986; Griffith, 1995).
diversified skills bases and economies.While
attempts were made to throw off what were Another distinctive feature of this period
perceived to be the ‘shackles’ of colonial which overlapped with attempts at self-reliance,
oppression through efforts to promote unique was the desire for and pursuit of prestige
forms of African development such as ‘Afro- projects to drive development.With the sup-
Socialism’ and the active courting of links port of the global financial bodies there was,
with the then USSR, China and the Eastern for example, significant investment in major
bloc, true economic independence from the river basin/large dam/HEP schemes. One of
West proved difficult to attain (Ayeni, 1997). the most significant was the development of
Lake Volta in Ghana which created a vast
The early Independence era in countries dam to supply electricity to the newly built
such as Ghana,Zambia,Ethiopia andTanzania aluminium smelter at Tema and which was
was characterized by bold attempts to imple- also meant to facilitate irrigated farming and
ment nationally appropriate strategies which fishing. Parallel initiatives included Cabora
often had a strong rural focus and an appeal Basa in Mozambique, Kariba between Zambia
to ‘self-reliance’ principles.The most extreme and Zimbabwe, the Aswan High Dam and
case was Tanzania which actively sought to multiple dam projects in Morocco. In almost
cut off links with the external world and all cases the schemes have not delivered the
pursued an ambitious policy of rural devel- full range of anticipated benefits (Best and de
opment through a ‘villagization’ development Blij, 1977).
scheme known as Ujaama. These strategies
had their roots in pan-Africanism as espoused Within countries Western-style interven-
by key African leaders such as Nkrumah tions such as a focus on the development of
from Ghana and the belief in African self- growth centres and support for industrial devel-
reliance as advocated by leaders such as opment nodes was supported to some degree
within most African countries (Ayeni,1997).

487

ETIENNE NEL

One of the most comprehensive assessments funding ceased. Extensive abuse of the system
of this process was provided in the study was also noted and, if anything, the South
by Alan Whiteside in 1981 who overviewed African case is something of an anti-model
the pursuit of these strategies in various parts with respective to the concept of regional
of Africa. Despite significant investment in development anchored in these outlying
infrastructure and industry, capital city domi- industrial growth centres (Rogerson, 1988;
nance of the economies was not significantly Nel, 1999).
altered and in countries such as Zimbabwe,
which pursued growth centre planning The contemporary context
through to the 1990s, the vast majority of the
growth centres failed to ‘take off ’. Problems Regional development (internal)
include insufficient resources, inadequate
incentives and a lack of market-based reasons In parallel with international experience tra-
for firms establishing in such centres. That ditional regional development interventions
said, in political terms, Zimbabwe was a fore- fell into abeyance in the 1980s and 1990s,
runner in establishing relatively high degrees often resulting from limited success and budget
of political decentralization (Gooneratne and constraints.Where regional development per-
Mbilinyi, 1992). sisted in the period from the 1980s through to
the 1990s it tended to have quite a distinctive
The most comprehensive form of regional project-based focus.This is shown in a compre-
development pursued in Africa in this era hensive overview of Regional Development
was undoubtedly South Africa’s Regional practice in the 1990s in Africa by the United
Industrial Development Programme which Nations Commission for Human Settlement
meshed regional and growth centre planning (UNHCS, 1997) which indicates the follow-
with its then racist ideology of developing ing broad themes:
‘racial reserves’ for the different tribal group-
ings in the country. Over 50 growth points i) River basin development – primarily
were established and a package of incen- in West Africa along the Niger River
tives once described ‘as the most generous and Lake Chad
in the world’ were made available to prospec-
tive industrialists. Significant state investment, ii) Lake basin development, e.g. around
estimated at some 10 per cent of government Lake Victoria
expenditure in the late 1980s was needed to
prop up a highly inefficient system which iii) National development planning, e.g.
aided some 10 per cent of national industries in Zambia with associated efforts to
and supported over 100,000 jobs (Rogerson, address regional inequalities
1988; Nel, 1999).The cessation of the policy
in the early 1990s witnessed the collapse of iv) Growth centre planning, e.g. in Ghana,
many of the former growth points and the Nigeria and Kenya
closure of most of the firms, to the detriment
of former employees in particular.Exceptions v) New capital city development, e.g.
occurred in places which were better resourced Malawi, Nigeria and Tanzania
and able to continue growing in the absence
of incentives, such as the towns of George, vi) Integrated rural development, e.g. in
Saldanha Bay and Isithebe. Studies have Tanzania.
shown that firms generally failed to develop
economic links with the host area and often In his critique of these approaches and the
remained on site only for the duration of apparently limited success of the initiatives
the incentives, ceasing operations when the implemented, Ayeni (1997) indicates that
these schemes suffered from both the appli-
488 cation of inappropriate planning and theory
and they were bedevilled with implementation
problems. Difficulties included spatial bias in

THE EXPERIENCE OF LOCAL AND REGIONAL DEVELOPMENT IN AFRICA

implementation, poor policy analysis, the which generally have emerged with little,
overwhelming focus of growth and migra- if any state support. Examples range from
tion on the big primate cities, and broader sophisticated manufacturing for the global car
economic changes including structural adjust- market, as exemplified by the Durban auto-
ment which severely curtailed the role the cluster in South Africa, to more informal
state could play in the space-economies of activities such as fish processing in Uganda and
African states. furniture manufacturing in Egypt (Oyelaran-
Oyeyinka and McCormick, 2007).
One of the more successful and long-
standing collaborative regional development In parallel, there has been widespread
arrangements exists in the Sengal River basin. experimentation with the concept of export
Following the signing of the Bamako processing in countries ranging from Liberia
Convention in 1963 between Guinea, Mali, to Botswana and Zimbabwe. Earlier research
Mauritania and Senegal a series of enduring by the ILO (in Nel, 1994) however found
programmes have been enacted, revolving results to be disappointing. In addition to
around the provision of water management, concerns about the limited success of inter-
communications and power-generating infra- ventions such as these, there remain the
structure.High levels of engagement between pressing challenges posed by rural areas
partners have reduced conflict and facili- which are subject to environmental degrada-
tated economic development in areas such as tion and economic decline, which also merit
fish farming and rice cultivation (Alam and some form of regional support (Gooneratne
Dione, 2006). and Obudho, 1997).

The recent revival and focus on more Regional development
sophisticated and diverse forms of regional (supranational)
development in the developed world has few
parallels in Africa.With certain South African A distinctive feature of regional development
exceptions, there are few examples of con- practice and policy in Africa is widespread
temporary regional strategies such as global subscription to the principles of cross-border
city development, science parks or high-tech linkages within the continent for purposes of
industrial zones.Another exception has been facilitating trade, social, cultural and economic
South Africa’s reinvigoration of regional exchange, peace-keeping and the overall pro-
development in the late 1990s when a ‘Spatial motion of pan-Africanism. International con-
Development Initiative’ programme focus- nectivity has a relative long history in the
ing on defined transport and economic continent.The world’s oldest customs union
growth corridors was initiated, in parallel is in fact the Southern African Customs
with the establishment of high-tech or Union formed in 1910, which now includes
export-orientated ‘Industrial Development South Africa, Botswana, Namibia, Lesotho
Zones’ (Simon, 2003).While the former has and Swaziland (Kyambalesa and Hougnikpo,
only achieved limited success, in the case of 2006). In addition, political Federations estab-
the latter, significant investment in purpose- lished in the 1950s in East and Central Africa
designed facilities with an export-orientated laid the basis for later regional arrangements.
focus and having special tax concessions have
seen the establishment of key port and indus- Makinda and Okumu (2008) argue that
trial zones at Coega (near Port Elizabeth), the proliferation of regional groupings in
East London and Richards Bay which are Africa came about because of the perceived
yielding initial success. Another noteworthy need for both collective security and develop-
trend has been the recognition given to the ment in the post-ColdWar era and in response
emergence of various ‘industrial clusters’ and to regional conflicts within the continent.
‘innovation systems’ in Africa in recent years
489

ETIENNE NEL

According to Adejombi and Olukoshi (in organizations can succeed they ‘would have
Cambria Press, 2008), slow economic progress serious repercussions for processes of regional
and increasing marginalization of the conti- development all over the continent’.The key
nent at the global level have given significant unions are as follows:
impetus to new regional development strate-
gies. The small size of national economies i) The SouthernAfrican Customs Union
and the logic of establishing a collective voice (SACU), established in 1910 as a
through supranational arrangements (Griffith, customs union with joint revenue-
1995) has created what Bell (1986: 108) sharing arrangements on tariffs derived
argues is a ‘powerful case’ for regional coop- from external trade (Kyambalesa and
eration.The net result has been the veritable Hougnikpo, 2006).
blossoming of a range of key initiatives dis-
cussed below. ii) The East African Community (EAC),
first established in 1967 and revived in
The post-independence era in Africa 2000, leading to the establishment of
was characterized by clear commitment in a customs union in 2005. A common
many parts of Africa to the principle of market and political union are planned
pan-Africanism and the determination of a and a joint LegislativeAssembly has been
unique and collaborative vision for the con- set up (Kyambalesa and Hougnikpo,
tinent (Makinda and Okumu, 2008). This 2006).
was initially advocated by first-generation inde-
pendence leaders such as Lumumba,Kenyatta, iii) The Economic Community of Central
Nyrere and Nkrumah. The latter argued for African States (ECCAS), which was
the idea that ‘Africa Must Unite’ (Griffith, established in 1985 to promote regional
1995). Despite this, early attempts at a union economic cooperation, free trade and
between Guinea and Ghana and calls for a customs union and eventually a
greater degrees of regional integration met Common Market in central Africa
with little success in the 1960s and 1970s (Kyambalesa and Hougnikpo, 2006).
(Davidson, 1994). These concepts have since
developed significantly, crystallizing in 1980 iv) The Economic Community of West
with the Lagos Plan of Action which laid the African States (ECOWAS) was estab-
basis for seeking greater degrees of self-reli- lished in 1975 by the Treaty of Lagos.
ance through supranational arrangements. In It seeks collective ‘self-sufficiency’
1963 the Organization of African Unity was through the development of an eco-
formed as a loose political union amongst nomic and monetary union and a
most of Africa’s states.This has since evolved trading bloc. Key organizations which
into the African Union, established in it has established include a Community
2001, which has now set up a Pan-African Court of Justice and a common peace-
Parliament and which has as one of its goals keeping arrangement (Kyambalesa and
the formation of an African Economic Hougnikpo, 2006; Konadu-Agyemang
Community ( Janneh, 2006). and Panford, 2006).

In addition to continent-wide initiatives, a v) The Common Market for Eastern and
not insignificant range of customs and nas- Southern Africa (COMESA), which
cent economic unions exist in Africa which was formed in 1994, replacing the
has variously assisted with issues such as the earlier Preferential Trade Area, estab-
provision of unified telecommunications lishing a free trade area between nine
networks in Southern Africa and the forma- of the member countries. There is
tion of regional peace-keeping forces in West an agreement to expand free trade
Africa. As Ayeni (1997: 53) notes, if these arrangements with the EAC and
SADC, which if finalized will create
490 free trade zones encompassing nearly

THE EXPERIENCE OF LOCAL AND REGIONAL DEVELOPMENT IN AFRICA

50 per cent of the countries in Africa been created which incorporates the entire
(Kyambalesa and Hougnikpo, 2006; continent with the exception of Morocco.
BBC, 2008). Mechanisms to promote peace-keeping,
vi) The Southern African Development democracy and development have been put
Community (SADC) was formed in in place (Mohamoud,2007).In 2007 a Union
1992 to replace an earlier political union Government for Africa was mooted.
in the region.The organization strives
to promote socio-economic, political A parallel but linked international initia-
and security cooperation. Currently tive which has been formally adopted by
12 countries have formed a free trade the AU is the New Partnership for Africa’s
area and progress has been made with Development (NEPAD) established in 2001
a range of joint projects in areas such through the merger of South Africa, Algeria
as infrastructure, trade and health care and Nigeria’s Millennium Partnership plan and
(Kyambalesa and Hougnikpo, 2006). Senegal’s OMEGA plan (Konadu-Agyemang
and Panford, 2006). NEPAD seeks to put
The Africa Free Trade Zone (AFTZ) formed in place mechanisms across the continent to
by links between SADC, COMESA and eradicate poverty,promote sustainable growth
EAC agreed on in 2008, and mentioned and development, integrate Africa into the
above, will link 26 countries with a GDP of world economy and accelerate the empow-
some US$624 bn (BBC, 2008). At a grander erment of women (Niang, 2005; Mohamoud,
level are the current and proposed activities 2007). Partnerships have since been devel-
of the African Economic Community (AEC) oped with many of the world’s key financial
which seeks to utilize the above-mentioned bodies and programmes focusing on agri-
regional groupings as ‘pillars’ for their pro- culture, science, e-schools, infrastructure and
posed activities. The AEC was founded in building continental institutions are being
1991 through the AbujaTreaty and has helped developed. In practice, slow progress, the
promote the development of the regional lack of civil society participation and percep-
trading blocs (Niang, 2006; Kyambalesa and tions that NEPAD is working too closely
Hougnikpo, 2006).The AEC is supported by with the ‘Washington Consensus’ organiza-
all of Africa with the exception of the Arab tions, and the dominance of South Africa
Maghreb Union. Future goals are a proposed in the organization are clearly concerns for
continent-wide customs union by 2019 and several member states (Makinda and Okumu,
an African Common Market by 2023. The 2008).
establishment of the AFTZ is clearly a key
step in the attainment of these eventual goals Challenges experienced by the various
( Janneh, 2006). regional blocs discussed above include: under-
resourcing, member countries participating in
At a political level the establishment of the overlapping organizations, the pursuit of self-
Organization of African Unity (1963) and its interest,limited supranational policing mech-
replacement with the African Union (AU) anisms, friction between members, limited
in 2001 have been the primary continent- mandates and long-standing conflicts, partic-
wide forms of regional political collabora- ularly in the Great Lakes region (Kyambalesa
tion and cooperation. Head quartered in and Hougnikpo, 2006). Other concerns
Addis Abba, the AU seeks to promote socio- include the limited nature of cross-border
economic and political integration, to seek infrastructure development and a continued
consensus and present common positions dependence not on intra-African but inter-
and to promote peace and security (Konadu- continental trade (Konadu-Agyemang and
Agyemang and Panford, 2006; Makinda and Panford, 2006).The UNCTAD (2009) argues
Okumu, 2008).A Pan-African Parliament has that while substantial progress has been made
to establish regional institutions, intra-African

491

ETIENNE NEL

trade, investment and people’s mobility have by communities (Gooneratne and Mbilinyi,
not increased significantly, leaving Africa 1992;Taylor and Mackenzie, 1992).
with some of the most fragmented markets
in the world. As a result a key UN report In terms of the theme of local government
released in 2009 (UNCTAD, 2009) argues decentralization, partially driven by structural
the case for enhancing ‘regional integration to adjustment requirements and partially by the
build stronger and more resilient economies widespread pursuit of democratic engage-
… Regional infrastructure, policy harmoni- ment, there has a been a dramatic shift in the
zation and increasing cross-border invest- locus of local government control from what
ment and labour mobility will help Africa in most countries was direct central govern-
benefit fully from economic opportunities ment control of local governments to one
provided by regional integration’. which acknowledges and facilitates local
control and decisions.The passage of decen-
One recent variant on the concept of tralization policies in countries as diverse as
regional development has been the promo- Ghana and Zambia are hallmarks of this
tion of a series of trans-frontier parks or game new era and the World Bank has noted how
reserves, primarily between South Africa and widespread the take-up of these policies has
its neighbours which has seen the removal of been (Gooneratne and Obudho, 1997; Hope,
border fences and the creation of extensive, 2008). However, on-the-ground evidence in
jointly managed international game parks countries with well-established track records
(Simon, 2003). of decentralization practice over more than a
decade indicates that deep-rooted opera-
Local development tional challenges impede progress (Egziabher
and Hlemsing, 2005) – these include lack of
Two broad themes characterize local devel- skilled staff in localities, limited funds and
opment in Africa. The first is the formal what Stockmayer (1999) has termed the
empowerment of local governments through consequential ‘decentralization of poverty’
processes of decentralization to engage more from being the responsibility from the cen-
directly with local development challenges. tral state to the local. The net result is often
The second relates to processes which have the inability to effect change on the ground, to
always been in existence, namely the actions provide needed infrastructure and the common
of local community groups desirous of challenge of only servicing the areas and com-
improving living and economic conditions munities which can pay, to the detriment of
in their locality. This accords with the argu- the marginalized majority. For example, in a
ment of Taylor (2005: 148) that in ‘contrast to city such as Lusaka only 10 per cent of areas
formal approaches to regionalism, the New have regular refuse removal.
Regionalism Approach ... has been more
sensitive to “bottom-up” processes that are A variant of local development is the
not considered by the more orthodox more focused approach of Local Economic
approaches’. In the view of Gooneratne and Development (LED) which has attracted
Obudho (1997) given the scale of the African some degree of attention across Africa.Whilst
economic crisis communities have to pursue many countries such as Swaziland and Zambia
local development options.They also recog- have expressed interest in the LED approach
nize the key role NGOs can play in support- and have put in place limited policy support,
ing local initiatives, often in the absence of applied practice across Africa is however
state support.A particular concern for a range limited (Gooneratne and Obudho, 1997;
of authors is the need for governments to Egziabher and Helmsing, 2005). The one
allow and to facilitate ‘local self-reliance’ exception is South Africa which is regarded
as something of a front-runner in the policy
492 and practice of LED (Rodríguez-Pose and

THE EXPERIENCE OF LOCAL AND REGIONAL DEVELOPMENT IN AFRICA

Tijmsitra, 2005). LED is now a legal require- lines proposed by the Diffusionist and
ment of local governments in that country Modernization approaches was not succeed-
and, interestingly, local governments have ing in addressing mass poverty in Africa gal-
been challenged to implement policies of vanized a reinterpretation of development
‘developmental local government’ which interventions and approaches. This included
implies being conscious of encouraging at one level the acknowledgement that ‘basic
development-related outcomes from all their needs’-type interventions were probably a
actions (Nel, 1999; Nel and Rogerson, 2005). more appropriate line to follow, and second,
Experience varies widely in the country there was the recognition of the informal or
from that of small,impoverished rural munic- ‘second economy’ as often being the largest
ipalities, which are only able to support part of the economy in many areas (Pacione,
limited community projects in activities such 2001; Hope, 2008). This led to the work
as community tourism and farming to the of the ILO and Hart and the application of
large metropoles which are pursuing glo- Reformist approaches throughout much of
bally competitive marketing and investment the continent in a targeted effort to support
strategies (Rogerson, 1997). Cities such as the newly recognized micro-entrepreneurial
Johannesburg and Cape Town have posi- sector (Hope, 2008). In the 1980s the scale of
tioned themselves on the world stage as the debt crisis and negative economic growth
‘global cities’ replete with modern airports, in the poorest communities forced many
sports stadia, convention centres, business and rural communities back into subsistence and
tourism support programmes and various the frequent reliance on barter and parallel
forms of informal sector support (Nel and economic systems. It is at this level that
Rogerson, 2005). Evidence however suggests despite numerous constraints, NGOs have
that outcomes, though often impressive, been the most active and governments have
seldom devolve down to communities most attempted various low-level support meas-
in need in the big cities. In smaller urban cen- ures such as the provision of market facilities
tres the lack of progress is more evident where and extension support to farmers and entre-
municipalities are unable to effect change, preneurs. In parallel, a significant volume of
often through a lack of resources and staff. literature on this dimension of local develop-
A net result of the limitations experienced ment has emerged. Prominent in this regard
by ‘developmental local government’ in both were the research and policy proposals of
large and small centres have been widespread Gooneratne and Mbilinyi (1992) based at
civil sector protests against local governments’ the United Nations Centres for Regional
restricted delivery in recent years (Nel et al., Development regional office in Nairobi,
2009). At a broader level in Africa there is Kenya. In addition, the work of Baker (1990)
growing recognition of the role local govern- and Baker and Pederson (1992) and research-
ments can play in development processes as ers based at the Africa Studies Centre in
indicated by the recent establishment of the Uppsala in Sweden exposed the realities of
‘Municipal Development Partnership for rural and urban livelihoods, and local eco-
Eastern and Southern Africa’. Based in Harare nomic adaptation in order to survive. While
in Zimbabwe, this organization is promoting the overall economic situation has improved
research and collaborative exchanges between in many parts of Africa since the 1980s
local governments. It also works with the and 1990s, for the majority of the poor, self-
‘Africa Local Government Action Forum’ reliance initiatives at the local/community
which has a primary focus, amongst others, and family levels remain critical survival. As
on the promotion of LED (MDP, 2009). outlined by Taylor and Mackenzie (1992) and
Egziabher and Helmsing (2005), initiatives
At the community level, the recognition such as the production of charcoal, basic metal
in the 1970s that development along the
493

ETIENNE NEL

and craft products are often critical in assur- needs to take cognizance of several trends
ing economic survival. In parallel, more and realities.These include persistent poverty
recent writings on rural and urban livelihood and marginalization, the rapid urbanization
strategies intimate just how important it is which is taking place, and the existence of
for communities to have multiple livelihood major urban development and management
strategies and sources of income in order to challenges. In addition, as Ayeni (1997) argues,
ensure survival. While often poorly under- future strategies will need to be more partici-
stood and difficult to directly support, it is patory in focus, and adhere more to principles
apparent that for a significant number of of decentralization. Major resource, funding
Africa’s residents this form of ‘local develop- and staffing constraints compromise the abil-
ment’ is critical to their survival. Future ity to effect change and clearly require urgent
research and policy support in these areas attention. That said, endeavours to promote
will be critical for the long-term well-being trade between countries in Africa through
of Africa’s residents (Egziabher and Helmsing, lowering customs barriers,widespread embrac-
2005). ing of the principles of decentralization, the
uptake of the concept of LED and support
Conclusion for community-based interventions are cause
for optimism about the future.
As the world’s poorest continent, and as the
one least likely to attain the Millennium References
Development Goals, Africa’s development
challenges are clearly significant and pro- Alam, A. and Dione, O. (2006) “Fueling
found. Africa suffers from the inherited Cooperation:A regional approach to reducing
legacy of regional development interventions poverty in the Senegal River Basin”, in Fox, L.
set up to link the continent’s key resource and Liebenthal, R. (eds) Attacking Africa’s Poverty:
nodes, at a subsidiary level into the global Experience From the Ground, Washington: The
economy. Post-Independence regional devel- World Bank, 95–116.
opment interventions have tended to sup-
port either the capital cities or have been Ayeni,B.(1997)“Regional Development Planning
high-profile developments which have and Management in Africa”, in United Nations
seldom achieved the envisaged success and Centre for Human Settlements (Habitat) Regional
they have seldom benefited those most in Development Planning and Management of
need. In the present era, of note at the inter- Urbanization, Nairobi: Habitat, 7–62.
national level are strenuous efforts to lay the
basis for various regional economic unions Baker, J. (ed.) (1990) Small Town Africa, Uppsala:
which might well culminate one day in an The Scandinavian Institute of African Studies.
African economic union. In parallel with
state-driven regional development interven- Baker, J. and Pedersen, P.O. (eds) (1992) The
tions, local development, either through Rural Urban Interface in Africa, Uppsala: The
emerging local government interventions Scandinavian Institute of African Studies.
or more long-established community-based
endeavours, though often achieving only Best, A.C.C. and de Blij, H.J. (1977) African
marginal success, remain critical for the eco- Survey, New York: John Wiley.
nomic well-being of the majority of Africa’s
population. BBC (2008) “Africa Free Trade Zone is Agreed”,
http://news.bbc.co.uk/2/hi/7684903.stm,
In terms of the way forward, future accessed 27 November 2009.
regional and local development in Africa
BBC (2009) “Africa’s PopulationTops One Billion”,
news.bbc.co.uk/2/hi/afr ica/8366591.stm,
accessed 27 November 2009.

Cambria Press (2008) “The African Union and
New Strategies for Development in Africa”,
www.canbvriapress.com/cambriapress.cfm?/
template=4&bid=271, accessed 12 November
2009.

Davidson, B. (1994) Modern Africa: A Social and
Political History, London: Longman.

494

THE EXPERIENCE OF LOCAL AND REGIONAL DEVELOPMENT IN AFRICA

Egziabher, T.G. and Helmsing, A.H.J. (2005) in South Africa”, Singapore Journal of Tropical
Local Economic Development in Africa, Geography, 18, 1, 175–195.
Maastricht: Shaker. Simon, D. (2003) “Regional Development–
Environment Discourses, Policies and Practices
Gooneratne, W. And Obudho, R.A. (1997) in Post-Apartheid Southern Africa”, in Grant,
Contemporary Issues in Regional Development J.A. and Soderbaum, F. The New Regionalism in
Policy, Aldershot: Avebury. Africa,Aldershot:Ashgate, 67–89.
Stockmayer, A. (1999) “Decentralization: Global
Gooneratne, W. and Mbilinyi, M. (eds) (1992) fad or recipe for sustainable local develop-
Reviving Local Self-Reliance in Africa, Nagoya: ment?”, Agriculture and Rural Development,
United Nations Centre for Regional 6, 1, 3–6.
Development. Taylor, D.R.F. and Mackenzie, F. (eds) (1992)
Development fromWithin: Survival in Rural Africa,
Griffith, I. (1995) The African Inheritance, London: London: Routledge.
Routledge. Taylor, I. (2005) “The Logic of Disorder:‘Malignant
regionalization’ in Central Africa”, in Boas,
Hope, K.R. (2008) Poverty, Livelihoods and M., Marchand, M.H. and Shaw,T.M. (eds) The
Governance in Africa, New York: Palgrave. Political Economy of Regions and Regionalisms,
Basingstoke: Palgrave, 147–166.
Janneh, A. (2006) “Development in Africa and United Nations Centre for Human Settlements
ECA”, Statement by the UN Under-Secretary- (Habitat) (1997) Regional Development Planning
General, UN, New York. and Managment of Urbanization, Nairobi:
Habitat.
Konadu-Agyemang, K. And Panford, K. (2006) United Nations Conference on Trade and
Africa’s Development in the Twenty-First Century, Development (UNCTAD) (2009) “Press
Aldershot: Ashgate. Release – Economic Development in Africa
2009”, PR/2009/022 25/06/09, UNCTAD,
Kyambalesa, H. and Hougnikpo, M.C. (2006) Geneva.
Economic Integration and Development in Africa, Whiteside, A. (1981) Regional Development in
Aldershot: Ashgate. Southern Africa, Pietermaritzburg: University of
Natal Press.
Makinda, S.M. and Okumu, F.W. (2008) The
African Union: Challenges of Globalization, Further reading
Security and Governance, London: Routledge.
Egziabher, T.G. and Helmsing, A.H.J. (2005)
Mohamoud, A.A. (2007) Shaping a New Africa, Local Economic Development in Africa, Maastricht:
Amsterdam: KIT Publishers. Shaker. (Comprehensive overview of local
economic development in Africa.)
Nel, E.L. (1994) “Export Processing Zones”,
Development Southern Africa, 11, 1, 99–111. Gooneratne, W. and Obudho, R.A. (1997)
Contemporary Issues in Regional Development
Nel, E.L. (1999) Regional and Local Economic Policy, Aldershot: Avebury. (Key overview of
Development in South Africa, Aldershot: the state of regional development in Africa.)
Ashgate.
Konadu-Agyemang, K. and Panford, K. (2006)
Nel, E. and Rogerson, C.M. (2005) Local Economic Africa’s Development in the Twenty-First Century,
Development in the Developing World, New Aldershot:Ashgate. (Key overview of develop-
Brunswick:Transaction Publishers. ment to opportunities and challenges in Africa.)

Nel, E., Binns, T. and Bek, D. (2009) “Misplaced Nel, E. and Rogerson, C.M. (2005) Local Economic
Expectations? The experience of applied local Development in the Developing World, New
economic development in post-apartheid Brunswick:Transaction Publishers. (Review of
South Africa”, Local Economy, 24, 3, 224–237. the state of local economic development in
South and Southern Africa.)
Niang, A. (2006) Towards a Viable and Credible
Development in Africa, Raleigh: Ivy House. Taylor, D.R.F. and Mackenzie, F. (eds) (1992)
Development fromWithin: Survival in Rural Africa,
Oyelaran-Oyeyinka, B. and McCormick, D. London: Routledge. (Comprehensive over-
(2007) Industrial Clusters and Innovation Systems view of community economic development
in Africa, Tokyo: United Nations University and self-reliance strategies.)
Press.
495
Pacione, M. (2001) Urban Geography, London:
Routledge.

Rodríguez-Pose, A. and Tijmstra, S. (2005) Local
Economic Development as an Alternative Approach
to Economic Development in Sub-Saharan Africa,
Municipal Development Programme/World
Bank:Washington DC.

Rogerson, C.M. (1988) “Regional Development
Policies in South Africa”, Regional Development
Dialogue, Special Issue, 228–262.

Rogerson, C.M. (1997) “Local Economic Deve-
lopment and Post-Apartheid Reconstruction

41

Globalization, urbanization and
decentralization
The experience of Asian Pacific cities

Shiuh-Shen Chien

Asian Pacific cities in the polluted cities are in Asia, all of which are in
global map China (World Bank China Quick Facts 2007);
while the world’s largest slum is observed in
Despite the disruption by the financial crisis in Dharavi of Mumbai, India. To sum up, local
the 1990s and doubts over the peaceful rise of and regional development in Asia Pacific can
China and India, the Asian Pacific region has be understood as an urban phenomenon.
become a global focus again, in which cities
have played a role to facilitate the transforma- During colonial times, cities in Asia Pacific
tion. In terms of population, 11 of the top simply functioned as primary commodity
19 world cities with population over 10 million production and resource extraction centers
are located in the region, with Tokyo at for Western imperialism (Murphey 1969).
35 million ranked at the top and Mumbai at Nowadays, these cities serve new roles in the
19 million as Asia’s second most crowded city globalization of Asian Pacific economy.
(as well as the fourth most crowded in the Tokyo, Hong Kong and Singapore are the
world) (United Nations Economic and Social most recognized Asian global cities in terms of
Affairs 2008) (Table 41.1). In addition, many connectivity of banking and finance industry
cities in the region are the size of nations not and command centers of headquarters. New
only in terms of population but also in terms Delhi positions itself as a global call center to
of economic products. The size of Tokyo in clients dialing toll-free numbers in North
terms of population is even bigger than the America. Such call center services offer the
combined total population of the five Nordic opportunity for Indian workers to situate
countries of Norway, Demark, Sweden, their own jobs within the global labor mar-
Finland, and Iceland. Shanghai’s economic kets. In the context that the Philippines is the
performance in terms of GDP is almost 300 largest exporter of government-sponsored
per cent of Cambodia. Besides, nine of the top labor in the region, diverse types of private
ten world’s highest skyscrapers are built in recruitment agencies have shaped many cities
Asian cities – in height order: one in Dubai, in the Philippines to involve global ‘repro-
one in Taipei, two in Kuala Lumpur, two in duction’ networks (Kelly 2009). In addition,
Shanghai, one each in Guangzhou, Nanjing, ciy-regions inTaiwan (like theTaipei-Hsinchu
and Hong Kong.Twenty of the world’s 30 most city-region and the Great Taichung Region)
have transformed themselves into an important
496

GL OBAL IZ AT IO N , U R BA N IZATION A N D D EC E N TR A LIZATION

Table 41.1 Cities with over 10 million population, 2007

Rank City/urban area Country Population
(millions)
1 Tokyo Japan
2 New York-Newark USA 35.7
3 Ciudad de México (Mexico City) Mexico 19.0
4 Mumbai (Bombay) India 19.0
5 São Paulo Brazil 19.0
6 Delhi India 18.8
7 Shanghai China 15.9
8 Kolkata (Calcutta) India 15.0
9 Dhaka Bangladesh 14.8
10 Buenos Aires Argentina 13.5
11 Los Angeles-Long Beach-Santa Ana USA 12.8
12 Karachi Pakistan 12.5
13 Al-Qahirah (Cairo) Egypt 12.1
14 Rio de Janeiro Brazil 11.9
15 Osaka-Kobe Japan 11.7
16 Beijing China 11.3
17 Manila Philippines 11.1
18 Moskva (Moscow) Russian Federation 11.1
19 Istanbul Turkey 10.5
10.1

Source: United Nations (2007),World Urbanization Prospects

node for high-technology knowledge to process. On the one hand, the inflow of
connect with high-technology hubs else- foreign direct investment (FDI) helps devel-
where like Silicon Valley, Japan and China oping cities increase productivity, transfer
(Yang, Hsu et al. 2009). technology, and promote trade. In the case
of the Pearl River Delta (PRD) in China,
This chapter reviews the dynamic develop- small and medium-scale, labor-intensive,
ment of Asian Pacific cities. Three driving processing-types of manufacturing and trade-
forces that led to their formation and trans- creative FDI coming from Hong Kong have
formation are identified: globalization and emerged as key not only for industrializa-
cross-border investment, urbanization in rela- tion but also urbanization. With the so-
tion to rural migrations, as well as decentrali- called FDI-induced exogenous urbanization,
zation empowering local self-interested agents Shenzhen has been transformed from a tiny
to initialize territorial competition.The social fishery village to an important metropolis
polarization and conflicts within cities, urban populated by more than seven million citizens
rapid growth without livability, and risks of and hundreds of thousands of illegal migrants
natural hazards and infectious diseases show (Sit and Yang 1997). Kunshan also has wit-
the transformation of the region comes with nessed substantial inflow of manufacturing
complicated challenges for sustainability. capital from Taiwan, transforming itself from a
rural county in the late 1970s to one of the
Globalization world’s high-tech areas famous for the note-
book industry and integrated circuit industry
Inward and outward investment (Chien 2007). In 2006, about 2.5 billion
laptop computers (one-fourth of the world
In terms of cross-border investment,economic production) were produced in Kunshan. But
globalization in relation to Asian Pacific urban globalization is a two-edged sword, as these
development can be understood as a dual
497

SHIUH-SHEN CHIEN

developing cities are more vulnerable to global transnational operations to sustain their
economic shock.The 1997 Asia financial crisis business growth and expansion.The transna-
rapidly increased unemployment and pov- tional ethnic social networks were able to
erty incidence in Jakarta, causing Jakarta’s facilitate economic growth in a cross-border
public revenue to drop dramatically and be context because they could ‘glue’ multiple
unable to support policies needed during economic actors in different countries as well
the financial crisis (Firman 1999). On the as ‘lubricate’ economic transactions among
other hand, some of Asia’s industrialized cities them (Chen 2000). Without their networks
skillfully utilize globalization as an opportu- and embeddedness as brokers, it would have
nity to expand their economic powers and been questionable whether rural China
political influences by stimulating industrial- cadres who were still deeply embedded in
ization in the least developed Asian countries. the communist legacy after Mao’s death
Osaka, Japan’s second largest city, recognized would know how to embrace globalization
that a transfer of capital and technology over- (Hsing 1996).
seas should be in relation to a strategy of
industrial upgrading at home.With an inter- Second, globalization of Asian Pacific cities
nationally oriented local development strat- is also facilitated by professional expatriates
egy, Osaka supported local firms to make and unskilled transnational laborers. The
enclaves of investment in other overseas former are able to accumulate and transfer
cities in order to upgrade its position in the high-level financial and technological know-
changing international spatial division of ledge as well as social practices and discourse
labor (Hill and Fujita 1998). In addition, from the western to the Asia Pacific region.
Singapore promoted cross-border operations For example, transnational expatriates trans-
not only in business firms but also in indus- planted certain know-how, know-who and
trial zones management. In order to exert its networks in developing complicated inter-
regional influences in Asia, Singapore trans- national financial and banking systems to
ferred their industrial management know- Hong Kong and Singapore (Beaverstock
ledge by co-building China Singapore Suzhou 2002). However, in contrast, the hundreds of
Industrial Park with the China authority thousands of unskilled labor migrants moving
(Yeung 2003). around within the Asian Pacific region served
as necessary city low-end human labor sources,
External agents playing a role like construction employers and domestic
workers, while being kept socially excluded
From a perspective of a gap between Asian in the host society.
experience and so-called ‘Western’ theories
on local and regional development, three Third, international organizations and trans-
kinds of external agents need to be particu- national development-related consultants also
larly addressed: Chinese business diasporas play roles in the transformation process of
(Yeung and Lin 2003), skilled expatriates Asian Pacific cities. Besides the individual
and unskilled transnational workers, and governmental budgets for urban infrastruc-
international organizations and consultant ture financing, three other public funding
agencies. First, among all foreign investors, sources include the World Bank, Asian
Chinese diasporas have been the most special Development Bank (ADB) and Japan Bank
and essential in rapidly developing Asia for International Cooperation. Over past
Pacific cities (Olds and Yeung 1999). Many decades ADB funded 276 loan projects total-
established ethnic Chinese business firms in ing US$16 billion and 595 technical assistant
the region were compelled to engage in projects worth US$335 million (www.adb.org/
Documents/Urban-Development/, accessed
498 28 February 2009). China, Indonesia and
India were the top three recipients of these

GL OBAL IZ AT IO N , U R BA N IZATION A N D D EC E N TR A LIZATION

urban projects for new town development, Urbanization
flood protection, health care, waste manage-
ment, air quality improvement, river govern- Urban growth and rural migration
ance, tourism, waterway rehabilitation and
so on. Moreover, international development- ‘Crowded’ is possibly the most intuitive
related consultant firms also helped glo- description for those paying a visit to any
balize cities in terms of diffusing development Asian city. In 2007, Asia’s urban population
knowledge. In the case of Calcutta, certain was about 1,645 million, which is nearly half
Western planning technology was trans- of the world’s total urban population. Cities
planted to become part of Calcutta’s plan- are growing at an unprecedented pace.
ning experience, mainly through the United While London took 130 years to grow from
States’ Ford Foundation (Banerjee and 1 million people to 8 million, Bangkok took
Chakravorty 1994). In one proposal compe- 45 years and Seoul only 25 years (Asian
tition for Shanghai’s new financial district, Development Bank 2008; United Nations
non-Chinese design professionals – the Economic and Social Affairs 2008).The rapid
‘Global Intelligence Corps’ – promoted urban population growth is supplemented as
several planning ideas, many of which are well by the high yearly population growth
adeptly incorporated by Shanghai cadres into rate: Karachi and Mumbai having over 5 per-
the official Shanghai development plan (Olds cent and Pyongyang and Kuala Lumpur over
1997). 4 percent (Figure 41.1).

7% Karachi Population (Millions)
Pyongyang Taipei 2.6
6% Seoul 10
Mumbai
Mumbai 19
5%
Tokyo 36

4% Kaula lumpur
Manila
3%
Shanghai
2%
Average population Jakarta Ho Chi Yangon
1% growth (1975–2007) Minh city Bangkok

0% Sydney
0%
Seoul

Taipei Tokyo

As percentage of total population in the country

5% 10% 15% 20% 25% 30%

Figure 41.1 Population growth rates and its primacy by selected cities.
Source: Author’s research

499

SHIUH-SHEN CHIEN

Along with that is an urban primacy phe- sectors. In general, the level of urbanization is
nomenon in Asia. Tokyo and Sydney occupy strongly correlated to per capita income;
20 percent of total population in Japan and and spatial agglomeration is highly related to
Australia respectively (Figure 41.1), and capi- greater economic productivity. Related to
tal regions in Southeast Asian countries, like that there is a changing economic structure
Bangkok, Manila and Kuala Lumpur, are in cities – increasing manufacturing (or so-
much bigger than their second city counter- called industrialization) and service industries
parts. Dhaka alone contributed 60 percent along with the declining agriculture industry
of Bangladesh’s total GDP, and Seoul 50 per- (Asian Development Bank 2008).
cent of Korea’s national account of GDP
(Ruck and Munich Re Group 2004). In addi- However, the city economy is not consti-
tion, megacities or megacity-regions have tuted of formal sectors alone, and informal
emerged, some of which are within a country, sectors actually contribute greatly to func-
likeTokyo-Osaka-Kyoto in Japan,Hong Kong- tions and operations of cities. A research
Shenzhen-Guangdong in China; and some of publication by ADB shows that by 2000
which form a cross-border integration, like the the relative size of the informal economy to
Growth Triangle of Singapore Johor-Riau, and the whole national output of products in
the Northern Triangle of Northern Malaysia, Thailand and Sri Lanka and the Philippines
Southern Thailand, Northern Sumatra. is over 40 percent; in Korea and Malaysia
and Bangladesh above 20 percent (Asian
The growth of urban population is con- Development Bank 2008). Informal trade
tributed to not only by the natural growth and enterprises in Manila and Chennai cover
from a high birth rate, but by the social large fractions of solid waste management,
growth from rapid rural migration as well. and in Beijing and Delhi for electronic waste-
It is because industrialization in many devel- recycling activities. In addition, dramatic
oping countries has come about together urbanization also creates a shelter crisis in the
with limited rural development. As a conse- sense that a large amount of people cannot
quence, peasants are made more vulnerable afford legal housing and therefore a number
in rural areas and must rely on migrant work of informal settlements have increased in
for survival. Rural areas were designated both absolute and percentage terms.
to supply labor for rapid industrialization
in cities. Tokyo experienced a high rate of Socially polarized urbanization
net domestic migration until 1970 with the
peak early in the 1960s. During the post- Urban landscapes in these cities are very
Mao period, many of China’s coastal cities socially polarized. On the one hand, a phe-
also attracted migrants from other provinces nomenon that cities compete among one
and from different cities within the prov- another to build skyscrapers is commonly
inces. Unfortunately, those rural migrants seen.Table 41.2 shows that only four out of
were not granted urban citizenship and in the top 20 highest buildings in the world are
many cases they were even treated badly as located outside Asia.And the skyscraper phe-
‘outsiders’ to the urban society. nomenon is also predominated by Chinese
cities – more than half of these 20 high-
Economically intertwined rise buildings are in cities in Taiwan, Hong
urbanization Kong and China. These skyscrapers collec-
tively symbolize an imagination of interna-
Urbanization in the Asia Pacific is economically tional development. Promoting skyscrapers is
intertwined between formal and informal a shortcut for Asian cities to gain more

500

GL OBAL IZ AT IO N , U R BA N IZATION A N D D EC E N TR A LIZATION

world-class identity and prestige (Bunnell who have also lived in informal settlements
1999). Similarly, Asian urbanization is also or areas characterized as “slums”. By 2000,
shaping a rise of scattered gated communi- more than 37 percent of the urban popula-
ties.These gated communities are financially tion in Bangladesh was living below the pov-
constructed by larger private developers, erty line. In the context of post-Mao China,
physically located in the urban outskirts the new urban housing allocation system
linked by freeways and flyovers, as well as does not favor the socially and economically
materially serviced by high-quality security disadvantaged but favors people with politi-
and daily services (gyms, laundries, and even cal position and connections, those of higher
groceries). Such kinds of new housing con- social-economic backgrounds and those
sumption serving an emerging mobile (trans- whose work units (dan wei) have greater
local and trans-national) high-class society organization authority. In addition, the
can be found in Manila, Jakarta and Beijing. expansion of the central business districts
also contributed to the displacement of
On the other hand, however, many low- low-income groups toward peripheral areas
income and peasant groups are marginalized of the cities. Under the guise of beauti-
and even excluded during the process of fication or improvement of the city, urban
urbanization. The consequence of a rapid renewal projects often involved serious
increase in population has resulted in a short- human right violations and forced evictions.
age of housing and related infrastructure In Sydney, development also has had a nega-
especially for the low-income household, tive impact upon the reduced supply of
forcing nearly half of the city population to affordable rental housing, particularly in the
live in conditions of miserable poverty and case of public housing in western Sydney
overcrowded slums. Dharavi in Mumbai has (Mee 2002).
the approximately 6 million other inhabitants

Table 41.2 Top 20 world’s highest buildings, 2007

Rank Building City Height Floors Year

1 Burj Dubai Dubai 818 m 162 2009
2 Taipei 101 Taipei 509 m 101 2004
3 Shanghai World Financial Shanghai 492 m 101 2008
4 Petronas Tower 1 Kuala Lumpur 452 m 88 1998
5 Petronas Tower 2 Kuala Lumpur 452 m 88 1998
6 Nanjing Greenland Financi Nanjing 450 m 66 2009
7 Sears Tower Chicago 442 m 108 1974
8 Guangzhou West Tower Guangzhou 438 m 103 2009
9 Jin Mao Tower Shanghai 421 m 88 1999
10 Two International Finance Hong Kong 415 m 88 2003
11 Trump International Hotel Chicago 415 m 96 2009
12 CITIC Plaza Guangzhou 391 m 80 1997
13 Shun Hing Square Shenzhen 384 m 69 1996
14 Empire State Building New York City 381 m 102 1931
15 Central Plaza Hong Kong 374 m 78 1992
16 Bank of China Tower Hong Kong 367 m 70 1990
17 Bank of America Tower New York City 366 m 54 2009
18 Almas Tower Dubai 363 m 68 2009
19 Emirates Office Tower Dubai 355 m 54 2000
20 Tuntex Sky Tower Kaohsiung 348 m 85 1997

Source: Data compiled from http://www.emporis.com/en/bu/sk/st/tp/wo, accessed 28 February 2009

501

SHIUH-SHEN CHIEN

Decentralization In terms of the latter, with some exceptions
like China and Vietnam, local elections have
Local entrepreneurial governance been widely implemented in Asia around
the 1980s and 1990s. Bangkok held the first
Asian cities are very ‘entrepreneurial’ as local mayoral election in 1984, Taipei in 1994,
governments make efforts innovatively and Seoul in 1995, and Jakarta in 2007.
proactively to promote development by cre- Implementation of local democratization is
ating new spaces of production (like China’s highly connected to popular movements
special economic zones), promoting new against authoritarianism and centralized
spaces of consumption (like Singapore’s casi- decision-making systems.
nos), and striving for new financial sources
for growth ( Jessop and Sum 2000). Kunshan Localities in competition
made a bold decision to develop a locally
initiated industrial zone without official per- The emergence of entrepreneurial local states
mission from any upper level governments. is related to territorial competition, referring
However, due to its successful development, to the intense competition among cities and
the zone was finally endorsed by Beijing regions for foreign investment. Outcomes of
and granted national approval (Chien 2007). intercity competition are actually a mixed
Hosting hallmark events is also a popular picture. On the positive side, a phenomenon
local entrepreneurial strategy. Seoul, Sydney of race to the top can be generated as a con-
and Beijing are cases in point to show that sequence. A story that there is a strong cor-
the urban infrastructure can be upgraded relation between intensive competition for
and city marketing can succeed through FDI and improvement of business environ-
a process of organizing for the Olympics ment in China is a case in point. Coastal
Games. Another example of social develop- China, which has accumulated more than
ment is an innovation of water ‘marketiza- 80 percent of the FDI since 1978, only
tion’ for the poor. In order to deal with required taxation and administrative fees of
persistent problems of access to good water 4.1 percent of the sales revenues of compa-
by the poor, Jakarta deregulated water mar- nies in that region. The figure in other
kets in 1990 by permitting private homes parts of China where there was relatively
with water connections to resell municipal less competition for FDI is 5–6 percent.
water to the poor, with relative costless Representatives of business in the coastal
expansion in the standpipe system as a southeast region only need to spend about
consequence (Crane 1994). 52 days per year with the local bureaucracy
to process business licenses,while the require-
The rise of local entrepreneurial states ment is from 62 to 72 days per year in other
in Asia is mainly triggered by a mechanism areas of China (Chien 2008).
of decentralization with two dimensions –
economic decentralization and political However, territorial competition also
decentralization. The former refers to local provides negative consequences in a sense
governances empowered with more mate- that in order to attract certain types of invest-
rial resources and administrative competences ment, local governments have to be willing
for local development. Most Asian Pacific to contrive all manner of incentives to major
countries have experienced much economic corporations and make a variety of conces-
decentralization. Fiscally speaking, local rev- sions, such as tax abatements, reduced charges
enue relative to the national revenue is much for providing physical infrastructure,or down-
higher on average, and local governments graded environmental and regulatory stand-
are able to promote better business envi- ards. When Disneyland announced plans to
ronments with less institutional constraints.

502

GL OBAL IZ AT IO N , U R BA N IZATION A N D D EC E N TR A LIZATION

invest in a new project in China, there was But the changing state–society relations in
fierce competition between Hong Kong and Asian cities cannot produce much optimism
Shanghai.The cost for the Hong Kong gov- because decentralization is more in favor
ernment to win the bid was reportedly of political families and international and
US$30 billion (ten times the investment paid domestic business interest groups. In Manila,
by its Disney counterpart) to co-build the industrial interests have created such devel-
park but it obtained only 43 percent park opmental pressure on urban lands that civil
ownership. What’s more, all profits from societies representing the urban poor groups
Disney trademarked goods sold in the Hong continue to face significant obstacles in their
Kong Disneyland are not shared with the effort to influence the government (Shatkin
Hong Kong government but go entirely to 2000). In addition, the dominance of one
the Disney corporation (Douglass 2002). political party and its hierarchical structure
has thwarted the scope for effective bottom-up
Self-interested agents in action planning in Kolkata.

Local entrepreneurial states in relation to Challenges ahead
embedded territorial competition actually
need to be ignited by proactive agents whose There are three major challenges ahead for
interests are highly involved in the political Asian cities, calling for a new holistic, pro-
economy of local development. In the con- gressive and sustainable solution for further
text of a young Asian urban democracy like development (Pike et al. 2007). First of all,
Bangkok, businessmen are more likely to have cities are struggling with problems of over-
an advantage to win elections, and exchange population and inadequate housing, unem-
political influence to back personal business ployment, congested transportation and
interests. Therefore those business-cum- deteriorating environmental quality, all ques-
politicians are more materially motivated tioning whether urban transformation in
to exert their dominance in the process of Asia Pacific is livable or not. Urban transpor-
industrialization and urbanization between tation congestion is partly because of rapid
national governments and people in the urban sprawl and partly because of the huge
localities (Shatkin 2004). Despite no elec- numbers of private motor vehicles, which is
tions in China, local cadres are still able to be a key cause of bad air quality in cities. In
politically motivated by the performance- China, the inhabitants of every third metro-
based personal management system. As career polis are forced to breathe in polluted air
path is related to economic growth during every day, accounting for the estimated 400
their tenures, careerist local leaders strive thousand deaths every year.As many cities in
and compete in order to achieve economic Asia Pacific accumulate considerable eco-
targets imposed from above (Chien 2008). nomic wealth, building up their ability to
address sustainability concerns for livability
One note to be addressed is that decen- must be a next top priority.
tralization has certainly opened an avenue
for civil society, such as community-based The second challenge is the social contes-
organizations and non-governmental organi- tation within cities, for two reasons: one is
zations that help the poor. New programs historical legacy and the other is because of
like the ‘Community Mortgage Program’ ethnic migration. Singapore used to be a trade
represent a promising paradigm shift to allow point in Southeast Asia connecting China,
squatter associations in Manila to acquire lands India, Malay and the West.This legacy makes
by means of state-guaranteed credit to be Singapore nowadays host four completely dif-
repaid over a period of 25 years (Berner 2000). ferent religions: Buddhism, Hinduism, Islam,

503

SHIUH-SHEN CHIEN

and Christianity. All of them are very active Calcutta’s Planning”, Journal of the American
in the society but with very limited interac- Planning Association 60(1): 71–82.
tions, creating a worry that a lack of mutual Beaverstock, J. V. (2002) “Transnational Elites in
understanding may result in potential con- Global Cities:British Expatriates in Singapore’s
flicts in the future. In addition, the concen- Financial District”, Geoforum 33(4): 525–538.
tration of Indo-Chinese-Australians in and Berner, E. (2000) “Poverty Alleviation and the
around Sydney is negatively depicted by Eviction of the Poorest: Towards Urban Land
most media and policy-makers, while Sydney Reform in the Philippines”, International
Muslims have been portrayed as non-existent Journal of Urban and Regional Research 24(3):
in the context of anti-mosque local poli- 554–566.
tics (Dunn 2004).Those unfriendly attitudes Bunnell,T. (1999) “Views from Above and Below:
toward ethnic migrations, if not changed, may The Petronas Twin Towers and in Contesting
become hidden time bombs for social inclu- Visions of Development in Contemporary
sion and harmony. Malaysia”, Singapore Journal ofTropical Geography
20(1): 1-23.
And the final challenge is environmental- Chen, X.M. (2000) “Both Glue and Lubricant:
related risks. Flooding has becomes much Transnational Ethnic Social Capital as a
more frequent in Asian Pacific cities, partly Source of Asia-Pacific Subregionalism”, Policy
because of rising sea levels due to climate Sciences 33(3–4): 269–287.
changes and partly because of subsidence Chien, S.-S. (2007) “Institutional Innovations,
due to excessive groundwater extraction. In Asymmetric Decentralization and Local
addition, natural catastrophes in high-density Economic Development – Case Study of
megacities cause widespread devastation. Kunshan, in Post-Mao China”, Environment
For example, the earthquake in Kobe in and Planning C: Government and Policy 25(2):
1995 resulted in thousands of fatalities, 269–290.
US$100 billion in damages, making it the Chien, S.-S. (2008) “Local Responses to
most costly natural disaster of all time (Ruck Globalization in China – a Territorial
and Munich Re Group 2004). The Severe Restructuring Process Perspective”, Pacific
Acute Respiratory Syndrome (SARS) case Economic Review 13(4): 492–517.
in 2004 also shows that infectious diseases Crane, R. (1994) “Water Markets, Market Reform
are easily spread within and between meg- and the Urban-Poor: Results from Jakarta,
acities. Diarrheal diseases, which are endemic Indonesia”, World Development 22(1): 71–83.
in Delhi, infecting a great number of the Douglass, M. (2002) “From Global Intercity
urban poor, are caused mainly by impover- Competition to Cooperation for Livable
ished quality of water supplies. More actions Cities and Economic Resilience in Pacific
toward appropriate precautions and pre- Asia”, Environment and Urbanization 14(1):
ventions are needed to reduce negative 53–68.
externality of megacities in terms of envi- Dunn, K. (2004) “Islam in Sydney: Contesting the
ronmental and health risks (Yang, Hsu et al. Discourse of Absence”, Australian Geographer
2009). 35(3): 333–353.
Firman,T. (1999) “From ‘Global City’ to ‘City of
References Crisis’: Jakarta Metropolitan Region Under
Economic Turmoil”, Habitat International
Asian Development Bank (2008) Managing 23(4): 447–466.
Asian Cities – Sustainable and Inclusive Urban Hill, R.C. and K. Fujita (1998) “Osaka’s Asia
Solutions, Manila, Asian Development Bank. Linkages Strategy – Regional Integration in
East Asia, Local Development in Japan”, Urban
Banerjee, T. and S. Chakravorty (1994) “Transfer Affairs Review 33(4): 492–521.
of Planning Technology and Local Political Hsing, Y. (1996) “Blood, Thicker than Water:
Economy – A Retrospective Analysis of Interpersonal Relations and Taiwanese
Investment in Southern China”, Environment
and Planning A 28(12): 2241–2262.
Jessop, B. and N.-L. Sum (2000) “An
Entrepreneurial City in Action: Hong Kong’s
Emerging Strategies in and for (Inter-)
Urban Competition”, Urban Studies 37(12):
2287–2313.

504

GL OBAL IZ AT IO N , U R BA N IZATION A N D D EC E N TR A LIZATION

Kelly, P.F. (2009) “From Global Production Yeung, H.W.-c. (2003) Strategic Governance and
Networks to Global Reproduction Networks: Economic Diplomacy in China: The Political
Households, Migration and Regional Economy of Government-linked Companies from
Development in Cavite, the Philippines”, Singapore. Regional Governance: Greater
Regional Studies 43(3): 449–461. China in the 21st Century, The Centre of
Contemporary Chinese Studies, University of
Mee, K. (2002) “Prosperity and the Suburban Durham, UK; 24–25 October.
Dream: Quality of Life and Affordability in
Western Sydney”, Australian Geographer 33(3): Yeung,H.W.-c.and G.C.S.Lin (2003)“Theorizing
337–351. Economic Geographies of Asia”, Economic
Geography 79(2): 107–128.
Murphey, R. (1969) “Traditionalism and
Colonialism: Changing Urban Roles in World Bank (2009) China quick facts.Available at:
Asia”, The Journal of Asian Studies 29(1): http://web.worldbank.org/wbsite/external/
67–84. countries/eastasiapacificext/chinaextn/0,,cont
entMDK:20680895~pagePK:1497618~piPK:
Olds, K. (1997) “Globalizing Shanghai: The Global 217854~theSitePK;318950,00.html. Accessed
Intelligence Corps and the Building of 31 May 2009.
Pudong”, Cities 14(2): 109–123.
Further reading
Olds, K. and H.W.-c.Yeung (1999) “(Re)shaping
‘Chinese’ Business Networks in a Globalising Croissant, A. (2004) “Changing Welfare Regimes
Era”, Environment and Planning D: Society and in East and Southeast Asia: Crisis, Change and
Space 17(5): 535–555. Challenge”, Social Policy and Administration
38(5): 504-524.
Olson, M. (1965) The Logic of Collective Action:
Public Goods and the Theory of Groups, Douglass, M.,T. Q. Le, et al. (2004) The Livability of
Cambridge, MA, Harvard University Press. Mega-Urban Regions in Southeast Asia: Bangkok,
Ho Chi Minh City, Jakarta and Manila Compared.
Pike, A., A. Rodríguez-Pose, et al. (2007) “What International Conference on the Growth
Kind of Local and Regional Development Dynamics of Mega-Urban Regions in East
and for Whom?”, Regional Studies 41(9): and Southeast Asia. Singapore.
1253–1269.
HO, K. C. and H.-H. M. Hsiao (eds) (2006) Capital
Ruck, M. and Munich Re Group (2004) Cities in Asia-Pacific: Primacy and Diversity,
Megacities- Megarisks- Trends and Challenges for Taipei, Center for Asia-Pacific Area Studies,
Insurance and Risk Management, Munich, Academia Sinica.
Germany, Munchener Ruckversicherungs-
Gesellschaft. Jones, G. and M. Douglass (eds) (2008) Mega-
Urban Regions in Pacific Asia: Urban Dynamics in
Shatkin, G. (2000) “Obstacles to Empowerment: a Global Era, Singapore, Singapore University
Local Politics and Civil Society in Metropolitan Press.
Manila, the Philippines”, Urban Studies 37(12):
2357–2375. Lin, G.C.S. (1994) “Changing Theoretical
Perspectives on Urbanization in Asian
Shatkin, G. (2004) “Globalization and Local Developing Countries”, Third World Planning
Leadership: Growth, Power and Politics in Review 16(1): 1–23.
Thailand’s Eastern Seaboard”, International
Journal of Urban and Regional Research 28(1): Marcottullio, P.J. (2001) “Asian Urban
11–26. Sustainability in the Era of Globalization”,
Habitat International 25(4): 577–598.
Sit, V. and C. Yang (1997) “Foreign-Investment-
Induced Exo-Urbanisation in the Pearl Ng, M.K. and P. Hills (2003) “World Cities or
River Delta, China”, Urban Studies 34(4): Great Cities? A Comparative Study of Five
647–677. Asian Metropolises”, Cities 20(3): 151–165.

United Nations Economic and Social Affairs Schmidt, J. D. (1998) “Globalization and Inquality
(2008) World Urbanization Prospects the 2007 in Urban Southeast Asia,” Third World Planning
Revision, New York, United Nations. Review 20(2): 127–145.

Yang, D.Y.-R., J.-Y. Hsu, et al. (2009) “Revisiting
the Silicon Island? The Geographically Varied
‘Strategic Coupling’ in the Development of
High-technology Parks in Taiwan”, Regional
Studies 44(3): 369–384.

505

42

Local development
A response to the economic crisis.
Lessons from Latin America

Antonio Vázquez-Barquero

Introduction financial crisis, which spills over into the real
economy. The developed economies have
For over 30 years, parallel to the intensi- begun a process of economic recession and
fication of the process of economic inte- the emerging economies have seen their
gration and globalization, multiple local growth rates substantially reduced, industrial
development experiences emerged and activity has shrunk, internal and foreign
unfolded in Latin American countries (Aghon demand is falling, unemployment rates grow,
et al., 2001; Altenburg and Meyer-Stamer, and poverty is increasing once again. Faced
1999;Vázquez-Barquero, 2002, 2007). Local with this scenario, the response to the crisis
initiatives change from one place to another should combine measures that aim both
because they are designed and imple- at re-establishing trust in the financial mar-
mented for a specific locality or territory. For kets and expanding bank credit, and at
the old industrialized regions, such as the increasing productivity and competitiveness.
Greater ABC in Sao Paulo, Brazil that is This chapter argues that local development
experiencing a strong industrial restructur- policies are useful for approaching the prob-
ing process; for rural areas with development lems that characterize the crisis of the real
potential, such as the region of the Sierra economy. As in the past, the objectives are
de los Cuchumatanes in Guatemala, that is to make the productive system more com-
in the early stages of the process of deve- petitive, to create jobs and improve social
lopment; for places that are trying to eradi- well-being, and local development policy acts
cate poverty, as in the case of the UNDP as a catalyst of the development mechanisms
project in Cartagena de Indias, Colombia, or through local initiatives.They facilitate entre-
to overcome the effects of a natural disaster preneurial development and the creation of
such the earthquake in the case of Villa El firm networks; they encourage the diffusion
Salvador, Peru. of innovation and knowledge; improve urban
diversity; and stimulate the development of
But the economic, political and institu- the institutional fabric. The local develop-
tional environment in which local initia- ment tools act on the determining forces
tives emerged has changed since the middle of capital accumulation and contribute to
of 2007. Developed and emerging econo- economic and social progress.
mies have found themselves affected by the

506

LOCAL DEVELOPMENT

This chapter is organized as follows. After Brazil; and of 7.3 per cent for Mexico.
describing the current crisis and its financial Growth projections in the most dynamic
and economic effects, some policy measures emerging economies have been revised for
adopted to counter the growing financial 2009 (GDP growth rate of 7.5 per cent in
crisis by advanced and emerging economies China; and of 5.4 per cent in India); while
are presented. Following this, the chapter for Russia a significant fall of 6.5 per cent in
argues that local development tools foster 2009 is foreseen.
increased productivity and make economies
more competitive, and, therefore, local initi- The advanced economies are experien-
atives can help overcome the crisis. The cing a strong restructuring process in their
chapter ends with some final comments service sectors. Financial activities are re-
on the strengths and weaknesses of local dimensioned, following the shutdown of
development. investment banks and their absorption by
commercial banks. In any case, as a conse-
Economic and financial crisis: quence of the reduction of financial activi-
some facts ties, job loss increased and branch networks
are being restructured. It is estimated that up
The current crisis is a global financial crisis to January 2009, 325,000 jobs were lost in
that is spilling over into the real economy. It the global banking system, and 20 banks have
started in the United States in August 2007 declared themselves bankrupt in Europe.
with the lack of liquidity and the decline in
solvency in the financial markets when the At the heart of the crisis is the restructur-
banking system incurred important risks ing of industrial activities in developed and
because of the default on an important part emerging countries. In the Eurozone, a rapid
of the subprime mortgages.After the collapse decline in industrial production took place
of the investment bank Lehman Brothers during the second semester of 2008, and
and the nationalization of the insurance continued in 2009. Eurostat reported that in
company AIG, in September 2008, the crisis April 2009 compared to the same period a
spread to international markets through the year ago, the European Industrial Production
stock exchange, the international banking fell 21.6 per cent in the Eurozone; 24.2 per
system, and the monetary standard (Bordo, cent in Italy; 23.2 per cent in Germany;
2008). 21.2 per cent in Sweden; and 19.7 per cent
in Spain. Activities in sectors such as auto-
The financial crisis is contaminating the mobiles, consumer electronics, suppliers for
functioning of the economy and this gener- the construction sector, textiles and garments
ated a decline in the GDP during the last and the food processing industries, have
quarter of 2008, and this contraction is sharply reduced their production.
expected to worsen throughout 2009 (IMF,
2009a). According to the update of the IMF In emerging economies industrial restruc-
World Development Outlook of July 8, the turing is also taking place, because of the
global activity will contract by 1.4 per cent sharp contraction of international demand,
in 2009. GDP, in real terms, will decline by foreign trade and direct investment. In China
2.6 per cent in the United States; and by 4.8 a noticeable slowdown in the growth of
per cent in the Eurozone; it will fall by 6.2 industrial production can be seen, dropping
per cent in Germany; and by 4.2 per cent in from 11.4 per cent in September to 5.4 per
Spain. The forecasts for Latin America show cent in December 2008. Furthermore, thou-
a GDP growth rate decline of 2.2 per cent; of sands of companies have closed down, espe-
1.5 per cent for Argentina; of 1.3 per cent for cially in the provinces of Guangdong and
Zhenjiang, during this period, and the steel,
car, petrochemical, and textile sectors are,
as the Chinese authorities recognize the

507

ANTONIO VÁZQUEZ-BARQUERO

need for profound restructuring. In Korea, Inequalities increase in the emerging
industrial production has fallen since October economies, which is why the reduction in
2008 and it is foreseen that it will continue the growth rate may increase social unrest,
to fall during 2009, as indicated by the reduc- especially when it combines with an increase
tion in car sales and exports. in poverty and a worsening in the functional
and regional income distribution. In Latin
According to the International Labor America, where the number of poor fell
Organization, unemployment is increasing by more than 12 million between 2002
as a consequence of the recession of the and 2005, the poverty rate continues to be
international economic system. The OECD high: 21.0 per cent of the total population
(2009) report states that the unemployment for Argentina in 2006; 33.0 per cent for
rate in the United States was 5.8 per cent in Brazil; and 31.7 per cent for México. Income
2008 and is foreseen to worsen and surpass distribution continues to be very unequal
9.3 per cent in the course of 2009 (10.1 per in Latin American countries as shown by
cent in 2010). Unemployment rose in the the Gini coefficient: in Brazil it was 0.590
Eurozone during the second semester of in 2007; in México it was 0.506 in 2006.
2008, and it is foreseen that this trend will In China, where the number of poor fell
continue throughout 2009, reaching 10.0 per from 835 million in 1981 to 208 million in
cent at the end of the year (12.0 per cent in 2005, income distribution worsened in a sin-
2010). In Spain, which has the highest unem- gular manner since the beginning of the
ployment rate in the Eurozone, the foreseen reforms in 1978, as the Gini coefficient
unemployment rate will be over 18 per cent increase from 0.33 in 1980 to 0.49 in 2005
in 2009 (20 per cent in 2010). In the emerg- shows.
ing economies, unemployment is on the rise
because of plant shutdowns. In China, the Structural policy measures
unemployment rate was 9.2 per cent in 2007 for the economic crisis
and the situation may worsen during the
coming months if the growth rate of the The current economic crisis is like no other,
economy falls below 8 per cent in 2009, and as it affects, in a singular manner, the financial
this is because the capacity of the economy system, and is destroying the productive
will be reduced for the absorption of the fabric of most of the dynamic regions and
new workers in the labor market. countries, which is why it cannot be resolved,
as on other occasions, by monetary policy
The economy’s incapacity to absorb new measures alone. What is needed are policies
workers and the increased unemployment that stimulate the quantitative expansion of
rate are having a negative effect on the living the money in circulation, but the reality in
conditions of the people, especially in the ter- the economies also asks for a treatment that
ritories with a low per capita income. During combines a number of measures that aim, on
the last 30 years poverty was reduced spec- the one hand, at re-establishing the trust in
tacularly throughout the world; according to the financial system and extending bank
the estimates of Chen and Ravallion (2008) credit, and, on the other hand, at improving
the share of the poor has fallen from repre- the productivity of firms and making econo-
senting 51.8 per cent of the developing world mies more competitive.
population in 1981 to 25.2 per cent in 2005
(in Latin America it fell from 11.5 per cent A necessary condition for overcoming the
to 8.4 per cent). Nevertheless, the tide may economic crisis is to make the financial
turn during the near future, if international system of the advanced and emerging econ-
demand is reduced, the slowdown of global omies work again. The combined action of
economic growth continues, and the labor
absorption capacity worsens.

508

LOCAL DEVELOPMENT

several countries has as its main objective to through the central or local admi-
satisfy the needs for liquidity, if and when the nistrations, is an initiative that the
banking system requires it, and to act deci- majority of the G20 countries take
sively in cases of bankruptcy of financial into consideration.
firms and banks. Therefore, actions aimed at iii) Policies for entrepreneurial develop-
rescuing banks in difficulties vary from coun- ment play a key role among the meas-
try to country: the nationalization in the case ures that the countries have announced
of insolvent banks and firms, as announced in they will try in their attempt to neu-
the United Kingdom and the United States; tralize the effects of the economic
the injection of funds into solvent banks that crisis. Among these are support to
are short of liquidity; the encouragement of small and middle-sized companies, the
mergers between financial entities; and the fostering of strategic activities, such as
support of the banks’ recapitalization through high technology or defense, and the
public and private funds, as the Federal development of renewable energies.
Deposit Insurance Corporation in the United iv) Social policy measures can also be
States is doing (Tamames, 2009). found among the initiatives that have
been proposed during the last months.
The banks’ task of recovering their role as Some actions aim at improved health
financial intermediaries, as well as to activate care (such as those that affect the
the functioning of the markets through the endowment of hospitals and doctors)
credit system is not easy. The adjustment of and education (improving the quality
the assets nominal value to their real value is of human resources); but also measures
a win-lose game and countries are seeking a that aim at supporting vulnerable
negotiated solution to the problem. In any groups such as the unemployed, poor,
case, changing the rules and norms of the and pensioners.
financial system’s functioning seems urgent,
and this requires an agreement between the Local development and the
economic operators and the institutional economic recovery
agents.The purpose is to recover trust in the
financial system so that the market regains its Local development policy emerged and
role within the economic activity. developed in poor and late developing coun-
tries, as an answer on behalf of localities and
Nevertheless, economic recovery requires territories to the challenges of poverty, pro-
a number of stimuli to foster increased produc- ductive restructuring and increased competi-
tivity and competitiveness. The International tion. Is local development a strategy for
Monetary Fund (2009b) describes some meas- fostering entrepreneurial development in
ures that the G20 countries have adopted, or places that are affected by the current crisis?
plan to adopt. Among these the following Why are local development tools useful in
should be emphasized: times of crisis?

i) A fiscal stimulus to demand. On the The search for a territorial
one hand, some of the G20 countries response to the crisis
have announced reductions in per-
sonal income tax, indirect taxes, and Local development and structural policies
corporate income taxes. But they also share the same objectives: increased produc-
plan to stimulate consumption through tivity, improvement in social cohesion, and
a line of credit to citizens with low conservation of natural and cultural resources.
income levels.
509
ii) Increased spending on transport and
communications infrastructure, either

ANTONIO VÁZQUEZ-BARQUERO

But their approach to the crisis problem is and local community change, and, also, the
different. Whilst structural policies choose a priorities to be incorporated in their devel-
functional approach, local development poli- opment policies differ from one local com-
cies define their actions under a territorial munity to another. Territorial strategic
viewpoint that seems more effective in the planning has turned, therefore, into a valua-
process of structural change. The reason ble instrument for the rationalization of
for this is that actions carried out in territo- decision-making and management in cities
ries must interact with the social, institu- and rural areas. There are multiple examples
tional, and cultural dimensions of the places. of this, such as Rosario and Córdoba in
Therefore, measures are more efficient when Argentina,or cities and regions in El Salvador,
they make use of local resources and are Guatemala, Honduras, Republica Dominicana,
articulated toward the investment decisions Ecuador, and Colombia where UNDP and
of the local actors. ILO encourage the creation of Local Eco-
nomic Development Agencies, on the basis
Two aspects condition the results of policy of strategic plans.
actions: the development potential that exists
within the territory, and the organizational Innovation, a strategic factor
capacity of the local actors. From this per- in production adjustment
spective, all localities and territories have their
development potential. This is true for rural Understanding the crisis as an opportunity
areas,such as the Cuchumatanes in Guatemala, for transforming the production system, and
as well as for dynamic cities, such as Rosario making the economy stronger and more
in Argentina.At the local, regional or national competitive at the international level, should
level one can find a determined production be at the core of the strategy for overcoming
structure, labor market, technical knowledge, the crisis. The key element is the introduc-
entrepreneurial capacity, natural resources, tion and diffusion of innovations throughout
social and political structure, or tradition and the productive fabric. Local development
culture, on which local initiatives are based. policies face the question of the adjustment
and restructuring of production systems in
On the other hand, the development of order to make firms more competitive in
a locality or territory requires public and product and factor markets. Income growth
private actors to carry out the investment and the changes in demand have led to the
programs in a coordinated manner. In Latin diversification of production in cities as well
America, the local development projects are as in rural areas. The development of the
coordinated and managed through new tourist activity in the cities of Cartagena de
forms of governance where public and pri- Indias and Havana, as well as the strength of
vate actors, international organizations, and cultural tourism in Chiapas and in the
non-governmental organizations participate. Yucatan Peninsula show how changes in
In Villa el Salvador, Peru, the ‘Autoridad international demand stimulate a diversifica-
Autónoma del Parque Industrial del Cono tion of production and therefore create the
Sur’ was created, and unites public and private conditions for the continuous introduction
actors with the goal of building up the indus- of innovations that upgrade local resources
trial park.In Jalisco,Mexico,local entrepreneurs, and make them competitive.
including the managers of multinational cor-
porations, participate jointly with public actors When economic integration increases,firms
in the creation of local supplier networks. try to develop their competitive advantages
in local and international markets. In this
Finally, the local development strategy way, production systems are always evolving
differs from one case to another, because the
demands of each territory are different, the
capacities of the inhabitants, companies,

510

LOCAL DEVELOPMENT

and, frequently, the activation of change is in the search for overcoming the economic
carried out on the basis of a renovation of crisis. Its strength rests on the fact that the local
traditional know-how by introducing new policy tools used stimulate capital accumula-
knowledge during the structural change tion, and therefore contribute to increasing
process. In the case of Cuchumatanes, for productivity and competitiveness (Vázquez-
instance, reproduction and feeding tech- Barquero, 2002).
niques have improved in ovine production,
and the technological package that led to the One of the objectives of local initiatives is
restructuring of natural coffee production fostering entrepreneurship and the forma-
into organic coffee was perfected and brought tion and development of firm networks.The
about increased coffee output and quality start-up and development of firms is a neces-
(Cifuentes, 2000). The adaptation and trans- sary condition in the development process,
fer of technology allowed the differentiation as firms transform savings into investment
of production that has made local products through entrepreneurial projects; further-
more competitive in national and interna- more, when the development of networks
tional markets. and clusters of firms is encouraged, it favors
the appearance of external economies of
In other localities and territories the ques- scale and the reduction of transaction costs.
tion is not so much the differentiation of pro-
duction or the reduction of cost but the Fostering firms’ development is used
finding of new products for markets in which often by local initiatives in Latin America,
local companies may maintain their competi- as seen in the case of the Cuchumatanes
tive advantage.This is the case inTapachula, in mountain area (Cifuentes, 2000).The project
Mexico, for instance, where the coffee pro- was launched by Guatemala’s Ministry of
ducers had to react in the face of strong com- Agriculture, Cattle and Food in 1994, and
petition from Vietnam in their markets, with affected 9,000 poor rural families, with a net
whom they could not compete over prices. income per family of less than $1,200 per
The answer was to change their production year. In order to favor sustainable develop-
activities and start cultivating tropical flowers ment, the improvement of local entrepre-
for markets such as the United States, for neurial and managerial capabilities was
which the farmers had to adopt new produc- encouraged.The experience and knowledge
tion technologies from abroad, to enter into of self-management that existed within the
new markets, and to adapt their knowledge to local population before the civil war was
the new productive and commercial reality. recovered, and cooperatives and associations
of peasants began to acquire full legal capa-
Firms and territories can also opt for the city. Moreover, more informally structured
production of new goods and services for organizations,or Interest Groups were encour-
which the demand in markets is increasing, aged, and this brought people with common
such as for products that incorporate high- productive and commercial interests together.
tech components and for which a strong
internal and international demand exists, as On the other hand, fostering cluster devel-
occurs in the electronics cluster in Jalisco, opment has become more frequent during
Mexico (Rasiah, 2007). the last decade,as shown by the case of Jalisco,
in Mexico.The Jalisco state government cre-
Local initiatives and increasing ated the Jalisco Development Corporation
productivity (JDC), whose main objective was the forma-
tion and development of an electronic clus-
It is through development actions that local ter (Rasiah, 2007). The JDC helps strong
initiatives can make an important contribution systemic coordination locally and fosters
clustering and human resource synergies, and
motivates new firm creation. In this way,

511

ANTONIO VÁZQUEZ-BARQUERO

the cluster makes an important contribution training skills strategic in obtaining entrepre-
toward differentiation of production and neurial and technological development for
division of labor, and the diversification of Rafaela,as does the Institute for Qualification
the local productive fabric, job creation and and Study for Local Development, a munici-
economic development. pal entity founded in 1997 to foster changes
and transformations in the local community.
Another main axis of local development
policy is the diffusion of innovation and Finally, initiatives targeting the building up
knowledge throughout the local productive and improvement of overhead social capital
fabric, which allows for the introduction of and of infrastructures are instruments fre-
new products and the differentiation of exist- quently used in local and regional develop-
ing ones, changes in production processes, ment policies. Firms prefer locations in
and the opening of new markets. All of this accessible places that are well endowed with
contributes toward the increase of produc- services which allow them to make good
tivity and competitiveness of the companies. use of economies of agglomeration and to
have good accessibility to product and factor
A particularly interesting case is that of the markets. Furthermore, the improvement of
Technological Centre do Couro, Calçado e infrastructures attracts industrial and service
Afins (CTCCA) of Novo Hamburgo, Rio activities to rural and peripheral localities
Grande do Sul in Brazil. This is a private, and regions, generating economies of diver-
non-profit institution established in 1972 sity and favoring an increase in productivity.
and founded for the purpose of helping the
footwear firms during the early stages of Sometimes, the question is to build up
their export activity, by providing services infrastructures, as in the Cuchumatanes
that would allow them to maintain the quality Project, where in order to reach Guatemala
standards required by international markets. City and international markets a link from
After more than 30 years, it has become an the mountain area to the Panamericana
institution capable of stimulating research highway was built. Other times, the question
activity and product and process develop- is the creation of a town, as in the case of
ment in the shoe industry of Brazil. Villa El Salvador, located 20 km south of
Lima and close to the Panamericana highway
Actions for training of human resources (Aghon et al., 2001).This is an initiative that
are strategic instruments for local develop- allowed the transformation of a deserted area
ment policy, for it is through this that know- into a city that at present has a population of
ledge is incorporated into the production of over 400,000 inhabitants. A Self-managed
goods and services and in the management Urban Community was created, and one of
of their own development strategy. When the main projects was the buildup of an
training activities are included in the devel- industrial park in order to provide industrial
opment strategy, the improvement in the land, equipment and the services required by
quality of human resources can help increase micro-firms and small and medium-sized
productivity, stimulate competitiveness, and firms.
even affect the cultural model in which the
development process must seek support. At times, the purpose is for transport
infrastructures to become a tool for sustain-
In Rafaela, an industrial district in able development like that of Curitiba,
Argentina, training is a recurring objective Brazil (Cambell, 2001). During the late
issue in all the institutions created through- 1990s, a project was launched that tries to
out the 1990s. Initially, the town promoted integrate urban infrastructure actions (con-
the improvement of personnel skills in order struction of a road that connects 14 neighbor-
to strengthen municipal management. The hoods in the periphery of the city) with
Center for Entrepreneurial Development business initiatives which use the premises
and the Regional Center in Rafaela consider

512

LOCAL DEVELOPMENT

(community huts) in which micro-firms and way contributes to increasing the sustainabil-
small enterprises can be located with the ity of the territory.
support of the services available through pro-
fessional and entrepreneurial training. The Finally, local development is not a strategy
urban transport system was transformed into whose results are guaranteed. Local develop-
a surface metro system and it became the ment policy seeks economic and social progress
strategic element for local development. and job creation by stimulating entrepre-
neurial development; but, an excess of exter-
Final comments nal aid would reduce the creative capacity of
entrepreneurs and local actors and therefore
Advanced and emerging countries experi- would limit the results of local initiatives.
ence a process of important productive Furthermore, it is a policy whose results
and social change due to the financial crisis depend on an efficient coordination of the
and the bank credit crunch, which start to measures and the actors in the territory; but
have profound effects on the real economy. it would lose effectiveness when actions are
Therefore, for solving these problems it carried out in an isolated manner because
would be helpful to combine measures the positive feedback effects from the inter-
that lead to the recuperation of trust in the action between the development instruments
financial institutions and to expand bank would be neutralized. Finally, local develop-
credit; with actions directed toward increasing ment is a participatory policy in which the
productivity and competiveness. local actors are the ones who design and
control its implementation; therefore, its
This chapter sustains that local develop- results would be affected when actions and/
ment is an instrument for helping to over- or objectives are imposed in a unilateral way,
come the economic crisis. Its strength is by local and external actors.
inherent to its strategy which focuses on the
question of productive adjustments under a References
territorial perspective. This allows finding
out concrete solutions to the problems of Aghon, G., Alburquerque, F. and Cortés, P. (2001)
specific territories, using precisely the devel- Desarrollo Económico Local y Descentralización
opment potential that is not utilized because en América Latina: Un Análisis Comparativo,
of the crisis. Its merits lie in that local devel- Santiago de Chile: CEPAL/GTZ.
opment is a strategy that stimulates increasing
returns to investments and, therefore, helps Altenburg, T. and Meyer-Stamer, J. (1999) “How
increase productivity and competitiveness. to Promote Clusters: Policy Experiences
from Latin America,” World Development, 27:
Yet, local development also seeks social 1693–1713.
progress and sustainable development. Devel-
opment is a process in which economic Bordo, D. M. (2008) “An Historical Perspective on
growth and income distribution are two the Crisis of 2007–2009,” Working paper,
aspects of the same phenomenon, given that 14569, Cambridge, MA: National Bureau of
the public and private actors, when they Economic Research.
choose and carry out their investments, do so
for the purpose of increasing productivity Cambell, T. (2001) “Innovation and Risk-taking:
and improving social well-being.Local devel- Urban Governance in Latin America,” in
opment is, likewise, a strategy that is based on Scott, A.J. (ed.) Global City-Regions. Trends,
the continuous improvement of available Theory, Policy, Oxford: Oxford University
resources, and particularly the natural and Press, pp. 214–235.
historic and cultural resources, and in this
Chen, S. and Ravaillon, M. (2008) “The Develop-
ing World is Poorer than we Thought, but no
Less Successful in the Fight Against Poverty,”
Policy Research Working Paper, 4703,
Washington:The World Bank.

Cifuentes, I. (2000) Proyecto Cuchumatanes. Trans-
ferencia de servicios técnicos a las organizaciones

513

ANTONIO VÁZQUEZ-BARQUERO

de productores, Huehuetenango, Guatemala: —— (2007) “Endogenous development: analyti-
Ministerio de Agricultura, Ganadería y cal and policy issues,” in A. Scott and G.
Alimentación. Garofoli (eds.) Development on the ground,
IMF (2009a) World Economic Outlook. April London: Routledge, pp. 23–43.
2009. Crisis and Recovery. International
Monetary Fund,Washington. Further reading
—— (2009b) “World Economic Crisis. Stimulus
Measures Bolstering Demand Amid Crisis,” Alburquerque, F., Costamagna, P. and Ferraro, C.
IMF Survey Magazine: Policy, February 6. (2008) Desarrollo económico local, descentralización
Washington: International Monetary Fund. y democracia, Buenos Aires: UNSAM.
OECD (2009) Economic Outlook, 85, June, Paris:
OECD. Courlet, C. (2008) L’Économie territoriales,
Rasiah,R.(2007)“Cluster and Regional Industrial Grenoble: Presses Universitaires de Grenoble.
Synergies:The Electronics Industry in Penang
and Jalisco,” in A. Scott and G. Garofoli (eds) Friedman, J. and Weaver, C. (1979) Territory and
Development on the Ground,London:Routledge, Function, London: Edward Arnold.
pp. 223–250.
Tamames, R. (2009) Para salir de la crisis Garofoli, G. (1992) Endogenous Development and
global. Análisis y soluciones, Madrid: Editorial Southern Europe,Aldershot:Avebury.
EDAF.
Vázquez-Barquero, A. (2002) Endogenous Massey, D. (1984) Spatial Divisions of Labour. Social
Development: Networking, Innovation, Institution Structures and Geography of Production, London:
and Cities, London: Routledge. Macmillan.

Sen, A. (2001) Development as Freedom, 2nd edi-
tion, New Delhi, Oxford: Oxford University
Press (Chapter 48).

514

43

North American perspectives on local
and regional development

Nancey Green Leigh and Jennifer Clark

Introduction targeted poverty alleviation and other specific
economic development strategies).
This chapter explores distinctions in US
and Canada local and regional development Looking beyond the national level, this
patterns that are framed by two approaches. chapter explores international influences that
The first approach is functional regional are shaping the two nations’local and regional
development – metropolitan regionalism – development patterns.These include trade and
which is focused on the scale of the city- immigration policies, divergent approaches to
region. The second is territorial regionalism regional innovation systems and the coordi-
which defines the region not by the bounda- nation of national, provincial, and regional
ries set by urban and industrial growth, but technology-led economic development. We
through natural resource or social-cultural conclude this chapter with a discussion of
spatial definitions.A further factor generating early evidence as to how the two nations’
regional and local development distinctions local and regional development practices are
between the two North American nations is being affected by the Global Recession as well
their degree of governmental decentralization. as to the pre-existing challenges of climate
change, inequality, and globalization.
In Canada, coordination at the federal
level has produced regional development Country overview
characterized by priority-setting and targeted
investment in city-regions and in industries Canada and the United States are, respectively,
and technologies. In the US, limited territo- the world’s second and third largest countries
rial-regional development programs are by physical size, but Canada has only one-
coordinated at the federal level while city- ninth of the US population (Table 43.1). In
regional development is an ad hoc collabora- fact, Canada has approximately 3.5 million
tion among states, local jurisdictions (towns, fewer people than the State of California
cities, and counties), and private interests. (36.8 million in 2008). In both countries,
The resultant US regional development however, the population is overwhelmingly
projects are generally aimed at discrete rather urban (80 percent), though Canada’s largest
than comprehensive goals (e.g. transportation cities are significantly smaller than those in
coordination; water resource management;
515

NANCEY GREEN LEIGH AND JENNIFER CLARK

Table 43.1 Key indicator comparison – United States and Canada

Indicator Canada United States

Land area 9,093,507 sq km 9,826,630 sq km
Administrative divisions 10 provinces/3 territories 50 States/1 District
Population (2008 est.) 33.2 million 303.8 million
Net migration rate 5.62 migrants/1,000 population 2.92 migrants/1,000 population
GDP (2008 est.) $1.567 trillion $14.33 trillion
2% 1.2%
Agriculture 28.4% 19.2%
Industry 69.6% 79.2%
Services $40,200 $48,000
GDP per capita (2008 est.) 32.1 (2005) 45 (2007)
Distribution of family income/GINI Index United States Canada
Trade 78.9/54.1 21.4/15.7
Exports (2007)/imports(2008 est.) 1867* 1776
Year became independent nation

* Became fully self-governing in 1931.
Source: Compiled from CIA The World Factbook; www.cia.gov/library/publications/the-world-factbook/;Annual
Estimates of the Resident Population for the United States, Regions, States, and Puerto Rico:April 1 2000 to July 1
2008 (NST-EST2008-01) from Population Division, U.S. Census Bureau, release date: December 22 2008

the US (Figure 43.1). Ninety percent of all greater than that of Canada’s. Further, nearly
Canadians live within 160 km (100 miles) of 30 percent of Canada’s GDP is still generated
the common border that Canada and the US by industry, as opposed to services (70 per-
share. Immigration is a larger driver of popu- cent), while industry only generates 20
lation growth for Canada than for the US, pecent of US GDP. US GDP per capita is 20
but Canada does not experience the same percent greater than that of Canada’s, but this
level of illegal immigration, largely because is accompanied by a 40 percent greater level
it does not share a border with a relatively of family income inequality. Greater income
poorer developing nation (Mexico). inequality is a documented trend accom-
panying the shift to higher levels of service-
Administratively divided into ten prov- based economies, and over the last three
inces and three arctic territories, Canada is decades most of the gains in US household
both an independent sovereign democracy income have gone to the top household
and a federal state. The US democracy is quintile (Blakely and Leigh 2010).
a constitution-based federal republic, and
includes 50 states, the District of Columbia, Significant increases in trade and eco-
and several territories. Among the many dif- nomic integration between Canada and the
ferences between the US and Canada, one of United States have come about since the
the most significant is Canada’s official bilin- enactment of the 1989 US-Canada Free Trade
gualism that formally recognizes its cultural Agreement (FTA) and its 1994 successor,
diversity and inherent regional distinctions. the North American Free Trade Agreement
Although the US is broadly diverse, it holds (NAFTA) that incorporated Mexico. The
onto a single national identity and recognizes US absorbs nearly 80 percent of Canadian
cultural distinctions and regional difference exports annually, resulting in a large trade
at the sub-national scale. surplus for Canada. Further, most US energy
imports (oil,gas,uranium,and electric power)
Both Canada and the US are considered come from Canada.
affluent, industrialized nations with signifi-
cant levels of advanced technology. Their Largely attributable to its abundant natural
gross domestic products are over the trillion- resources, Canada’s economic growth from
dollar level, though US GDP is 11 times 1997 to 2007 was accompanied by balanced

516

NORTH AMERICAN PERSPECTIVES ON LOCAL AND REGIONAL DEVELOPMENT

Figure 43.1 Top 25 metropolitan areas in the US and Canada, 2006.
Source: (1) Natural Resources Canada; (b) Statistics Canada; (c) US Census
Note: Maps of Hawaii, Puerto Rico, and the Virgin Islands are not to scale

federal budgets, unlike the US which has or metropolitan regionalism, is focused on
experienced trade and budget deficits over the scale of the city-region and parallels
the same period. The US set off a Global much of the regional development practices
Recession in 2008 due to its sub-prime emerging in other developing countries
mortgage crisis, falling home prices, slow- (Pike 2009). Territorial regionalism defines
down in construction, failures in the banking the region not by the boundaries set by urban
and investment industries, and tightening and industrial growth, but through natural
of all types of credit. Canada’s economy was resource or social-cultural spatial definitions.
significantly affected. The tension between these regionalisms has
been consistent in the US and less pronounced
Two analytical frameworks for in Canada. Canadian coordination at the fed-
local and regional development eral level has produced regional development
projects characterized by priority-setting with
North American regionalism has evolved provinces and targeted investment in city-
along two major trajectories: functional and regions, in industries, and in technologies
territorial. Functional regional development, (Wolfe and Holbrook 2000).While the chal-
lenge for Canadian federal regional policy

517

NANCEY GREEN LEIGH AND JENNIFER CLARK

has long been smoothing out the uneven when they do not coincide with natural
development patterns between affluent and environmental boundaries (i.e. watersheds)
lagging provinces and rural and urban areas, or functional economic boundaries (i.e. a
these policies at the federal scale of govern- metropolitan economy that encompasses
ance have been consistent and coordinated multiple county units of government or even
(if not wholly effective) (Wellar 1981; Savoie states).
1986; Wolfe and Holbrook 2002; Doloreux
and Dionne 2008). Because Canada is divided into only ten
regional administrative units or provinces
The historical experience in the US is and three territories below the national level,
described in Friedman and Weaver’s Territory there is much greater capacity to implement
and Function (1979) and Markusen’s Regions regional approaches than there is in the
(1987). The US experience with territorial US that is divided into 50 states. Further
regionalism is intermittent, with occasional inhibiting regional approaches in the US
federal policies targeted at specific technical is the fact that states are subdivided into
challenges (rural electrification, the interstate counties, each with their own local govern-
system) or disadvantaged regions (Appalachian ment. The total number of counties is over
Regional Commission).The US experience 3,000, compared to 288 Census Divisions
with metropolitan regionalism is rooted in in Canada – the most analogous geo-
the continuing interest and concern of plan- graphic unit. Furthermore, the number as
ners with metropolitan and urban govern- well as land area of counties varies widely
ance and the challenges of urbanization, amongst US states (for example, the State of
exemplified by the work of Clarence Stein, California with a land mass of nearly 156,000
Lewis Mumford, Robert Moses and other square miles has 58 counties while Georgia’s
metropolitan planners and regionalists (Caro nearly 58,000 square miles are divided into
1974; Sussman 1976; Friedmann and Weaver 156 counties (Blakely and Leigh (2010)).
1979; Weir 2000). However, this strategy Finally, in addition to its county units, the
has been erratic in implementation with US has approximately 35,000 municipalities
moments of dramatic policy shift (e.g. met- and towns.
ropolitan governance in the Twin Cities and
Portland; progressive cities initiatives, the In the US, local economic development
Smart Growth Movement), and long periods has historically been defined as job or wealth
of significant federal and state disinvest- creation (Fitzgerald and Leigh 2002). With
ment (Clavel 1986; Orfield 1997; Dreier, few exceptions, the approach has been mar-
Mollenkopf et al. 2001). ket-based and modeled explicitly on export
base theory. Consequently, policy has taken
Influence of decentralization on two interrelated forms: (1) tax-based subsidies
regional and local development to individual firms (usually basic) intended
to influence their location decisions, and
A further factor generating regional and (2) redevelopment incentives to increase prop-
local development distinctions between the erty values (Malizia and Feser 1999). In the
two North American nations is their degree first case, that of firm-specific subsidies, results
of governmental decentralization. It has long are measured in terms of jobs created. In the
been acknowledged in local and regional second, the measure of success is an increase
development that the delineation of admin- in the local tax base. Redevelopment has been
istrative boundaries (i.e. a city or county’s particularly favored in cities because of its
legal boundaries) for a territory can create potential to increase property values (Sagalyn
problems for planning and policy-making 1997; Fainstein 2001).

518 The efficacy of these strategies has been
critiqued for 60 years but those responsible

NORTH AMERICAN PERSPECTIVES ON LOCAL AND REGIONAL DEVELOPMENT

for implementation have shied away from regional interests and obtain federal resources.
accounting for their results.When they have For example, the Northeast-Midwest Institute
done so,stated objectives were rarely achieved was formed during the 1970s when states in
(Bartik 1991; Bingham and Mier 1997). More those two regions (which came to be called
recently, ideas counter to this economic the Rustbelt) were beginning to experience
development practice have gained popularity. severe de-industrialization effects.The Institute,
They include concepts such as regional inno- focused on creating economic vitality, envi-
vation systems, the creative class, industry ronmental quality, and regional equity for
clusters and sustainable economic develop- Northeast and Midwest states, has close ties
ment (Porter 1998; Cooke 2002; Florida to Congress through the Northeast-Midwest
2002; Newby 1999; Leigh and Fitzgerald Congressional and Senate Coalitions. These
2002). These strategies tend to emphasize bipartisan coalitions advance federal poli-
regional solutions to shared problems and a cies that can enhance the region’s economy
reorientation of investment to innovative and environment (see www.nemw.org ). State
institutions, human capital, and emerging governors from the South also formed an
(green) technologies rather than direct firm organization to promote their regional econ-
subsidies (Clark and Christopherson 2009). omy and quality of life in the 1970s. The
Southern Growth Policies Board represents
In Canada, the practice of local economic the 13 southern states as well as Puerto Rico
development, particularly the focus on firm and partners with legislative groups as well as
attraction, retention, and expansion strategies others to promote its development agenda
has been generally consistent with US prac- (see www.southern.org).
tice. However, while the Canadian model is
business-oriented, it has included a broader The United States’ limited territorial-
commitment to distributional equity. In regional development projects are generally
other words, the distributional concerns sur- aimed at discrete rather than comprehensive
face in assessing both the allocation of costs goals (e.g. transportation coordination; water
and benefits of development.While this prac- resource management; targeted poverty alle-
tice is uneven across Canada (as it is in the viation and other specific economic develop-
US), the growth of neoliberalism within ment strategies). However, the most significant
Canada in the past 15 years has eroded the transportation project for regional develop-
commitment to social services and distribu- ment was not specifically targeted to regions.
tional equity (Reese and Fasenfest 1996; It was the National Interstate and Defense
Reese and Rosenfeld 2004). Highways Act of 1956 which led directly to
the auto-dominated pattern of local and
The US has limited territorial-regional regional development that is now creating
development programs coordinated at the significant problems for the goals of sustaina-
federal level while city-regional development bility. Other federally funded “Development”
is an ad hoc collaboration among states, local highways were later piggy-backed onto the
jurisdictions (towns, cities, and counties), and 1956 Act and targeted some of the country’s
private interests. Much of the country’s local poorest regions.
and regional development patterns are shaped
by political fragmentation and competition The Tennessee Valley Authority Act of
between jurisdictions. The federal govern- 1933 is an early example of the federal gov-
ment does not have a pro-active policy of ernment’s targeted regional development
encouraging cooperation between states, and program. In a letter to Congress, President
instances where states encourage cooperation Franklin D. Roosevelt described the new
between counties or municipalities are rare. entity’s responsibilities as: “planning for the
proper use, conservation, and development
There are, however, instances where states of natural resources of the Tennessee River
have banded together to protect their common
519

NANCEY GREEN LEIGH AND JENNIFER CLARK

drainage basin and its adjoining territory for established by federal legislation in 1959, and
the general social and economic welfare of the creation of coordinating agencies in the
the Nation” (Owen 1973: 14, requoted in form of Councils of Governments and
Forrest 2002). Subsequent major federal tar- Metropolitan Planning Agencies. Support for
geted regional development programs include these efforts began to wane under the Reagan
the Appalachian Regional Commission (1965), Presidency (Mitchell-Weaver et al. 2000). By
Delta Regional Authority (Mississippi 1965), the 1990s, however, sprawling metropolitan
Denali Commission (Alaska 1998),Interagency areas became a key focus of federal, state,
Task Force on the Economic Development and local government. In 1996, the US
of the Southwest Border (1999), and the Environmental Protection Agency partnered
Northern Great Plains Authority (2002). with non-profit and government organiza-
tions to create the Smart Growth Network
The largest impetus for US local and which advocates for compact growth (see
regional development planning, however, is Smart Growth Network, www.smartgrowth.
found at the metropolitan level. While the org). Growing attention has been focused on
quote below is from 2008 (Mitchell-Weaver intra-metropolitan changes such as declining
et al. 2000), observe that the roots of US inner-ring suburbs, new residential growth
metropolitan regionalism began in the early in some downtowns while others are hol-
nineteenth century. Moving into the twenti- lowing out, new suburban and exurban
eth century, they write that US metropolitan immigrant populations, and widening ine-
planning was a reaction to the second indus- quality (Lee and Leigh 2007).
trial revolution and focused on four themes:
housing reform, park and boulevard plan- The importance of metropolitan areas to
ning (a component of the City Beautiful national and state economies argued in the
Movement), using social statistics and land quote below is reinforced and extended by
use data to plan for metropolitan expansion, two additional concepts. First, clusters of
and government reform targeting profes- metro areas are growing into “megaregions”
sionalization and annexation. This planning that cross state boundaries and represent a
was initiated by civic associations, the most new form of functional regionalism (Goldfeld
famous of which continues to be the 2007). Second, the largest metro areas have
Committee on Plan of New York which become global cities that are characterized
published its first plan for the metropolitan by Sassen (2006: 54–55) as “partly denation-
area in the 1920s. The committee is now alized territorializations with considerable
known as the Regional Plan Association and regulatory autonomy through the ascend-
encompasses 31 counties in the tri-state area ance of private governance regimes” (2007:
of New York, New Jersey and Connecticut. 54–55). Katz et al. (2009: 23) argue that:
It has made two major revisions to the metro-
politan plan and is now focused on implement- America doesn’t really possess a natio-
ing the third plan in the areas of community nal economy, or even a collection of
design, open space, transportation, workforce 50 state economies. Instead, America’s
and the economy (see www.rpa.org). long-term prosperity stands or falls on
the more local prosperity of its 363 dis-
The federal government did not become tinct, varied, clustered, and interlinked
involved with metropolitan problems until metropolitan economies, dominated by
the Great Depression.There has never been a the 100 largest metros—many of which
major movement to create actual metropoli- cross county and state jurisdictions
tan government at the federal level; there and incorporate multiple city centers,
have been efforts to create greater intergov- suburbs, exurbs, and downtowns in a
ernmental cooperation such as the Advisory way that the old hub-and-spoke model
Commission on Intergovernmental Relations

520

NORTH AMERICAN PERSPECTIVES ON LOCAL AND REGIONAL DEVELOPMENT

of urban geography never did. In technology investment with traditional eco-
that sense, America is quite literally a nomic development practices using a targeted
“MetroNation,” utterly dependent on industry or technology approach, often based
the success of its metropolitan hubs. on a clusters framework (Doutriaux 2008).
The celebrated success of Silicon Valley, par-
Targeted local and regional ticularly during a period when other regions
development policies were experiencing precipitous declines, shaped
much of US regional development since the
Emerging technologies and industries have 1980s (Saxenian 1994).These strategies devel-
had a significant influence on North oped as cluster-based approaches, often linked
American local and regional development to research centers and frequently based in
policies. Industry cluster strategies dominated universities. While primarily articulated at
the local and regional economic develop- the regional scale in the US, the cluster-based
ment policy discourse and practice in the approach was adapted in other countries as
1990s, stimulated by the success of Silicon national industrial policy or as science and
Valley and Michael Porter’s “diamond” technology policy in an effort to initiate,
model for national and regional competi- through policy and planning the connection
tiveness (Porter 1990). In recent years, between technology and the growth seen as
cluster strategies have merged with local and the root of the Silicon Valley success story
regional technology-led development strate- (Bluestone and Harrison 1982; Atkinson-
gies, including sustainable or green technolo- Grosjean 2002; Hospers et al. 2008).
gies and industries (Martin and Mayer 2008).
Concurrently there has been a renewal of local In the United States and Canada, the tech-
and regional development policies focused on nology-led economic development strategies
human capital, regional capacities, and innova- neither began with the major policy trans-
tion systems. formations of the 1980s nor followed the
same path. In both countries, the “Centers of
The merger of regional economic devel- Excellence” or “Innovation Centers” model
opment strategies and technology-led or represented a simultaneous expansion and
innovation-based policy has led to multi- deviation from the network of national
scalar innovation systems in many industrial- government labs implemented over the
ized countries including in North America post-Second World War era and sponsored
(Pike et al. 2006).The intentional placement by a variety of national-level agencies. The
of the region as the central scale of economic emphasis of the traditional research centers
development investment characterizes these was a sector of the economy (e.g. energy
systems and policy approaches (Perry and or defense) rather than a specific industrial
May 2007). This model of technology-led sector (e.g. automobiles or semiconductors)
economic development integrating innova- or a targeted technology (e.g. biotechnology,
tion and commercialization strategies with nanotechnology, or optics and photonics).
regional development objectives arrived in This new economic development involved
the US and Canada in the 1980s (Roessner several key elements: inclusion of techno-
1985; Feller 1997). The impetus to reorient logy transfer, emphasis on the collaboration
economic development policy was precipi- between academic and industry researchers
tated by a popular perception of a wide gap with the goal of commercialization, reorien-
between innovation and commercialization tation toward an emerging technology rather
in both Canada and the United States. than an established industry sector, and rec-
ognition of the role of regions as engines
The emerging economic development and containers of agglomeration economies
models in North America integrated (Rood 2000).

521

NANCEY GREEN LEIGH AND JENNIFER CLARK

In the mid-1990s, the US and Canada spillovers through investment in research and
undertook two different national strategies development infrastructure and an emphasis
aimed at institutionalizing technology-led on technology transfer (Feller 1997). In par-
economic development at the sub-national ticular, the Centers of Excellence in Ontario
scale. These two paths, the decentralized impressed state-level policy-makers in the
US approach and the coordinated Canadian US. In New York, Georgia, and Texas the
approach, in many ways mirrored the previ- model emerged as explicit components of
ous policy path dependencies in each coun- state-driven regional innovation systems
try and their divergent approaches to the intended for economic development and
role of government in the distributional based, in part, on an industry clusters analysis
consequences of economic development (Christopherson and Clark 2007).
planning.
In NewYork, the implementation of these
In Canada, the National Centers of centers was accompanied by promises of
Excellence (NCE) program began as a part- impressive job growth, a traditional economic
nership of Industry Canada and three other development metric from industry investment.
federal agencies: It was based in universities Like the Canadian NCE program, the state-
and emphasized a “distributed network level Centers of Excellence programs oriented
approach.” This approach took two direc- toward existing industry clusters, regional
tions. It paired a national network of scien- technology specializations,or specified national
tific excellence with a local network of or state priorities (e.g. genomics or stem cells).
firms and industry actors. Thus, the Centers Unlike the Canadian programs, the proli-
of Excellence were embedded in existing feration of state-level technology-led regional
regional industrial clusters and connected economic development strategies developed
across Canada to a national research network without explicit multi-scalar coordination,
(Globerman 2006). In general, funding of thus magnifying existing issues of interjuris-
scientific priorities has been set by the federal dictional competition for public and private
government and implemented through the investment (Malecki 2004; Christopherson
university networks and regional institutions and Clark 2007).
(Salazar and Holbrook 2007).
At the center of the collaborative,
In the US, the technology-led develop- Canadian approach has been the “distributed
ment model took several paths following network model” in which technology-led
parallel but less coordinated tracks at the economic development strategies interact
state and national levels. At the national with and complement existing concentra-
level, a Centers of Excellence model was tions of capital (human, social, and venture)
implemented incrementally through the in dominant urban areas. The distributed
existing framework of the National Science network model explicitly takes the tension
Foundation.These centers never emerged as between the goal of providing national access
linked, in design or in practice, to regional to education and research resources with
innovation systems or as active and consistent the imperatives of the highly concentrated
coordinators of regional economic develop- and localized geographies produced by
ment strategies. A version of that center both agglomeration economies and the poli-
model, closer in character to the Canadian cies intended to support them (e.g. techno-
NCE project, emerged instead at the state logy transfer). Although it remains unclear
level in the US. Beginning in the late 1990s, whether lagging regions are advantaged
several states in the US recognized the through the distributed network model, the
potential of university-based technology- Canadian approach attempts to avoid work-
led development strategies as a mechanism ing against the economic success of periph-
for broader regional economic development eral regions (Doloreux 2004; Trippl and

522

NORTH AMERICAN PERSPECTIVES ON LOCAL AND REGIONAL DEVELOPMENT

Tödtling 2007; Doloreux and Dionne 2008). years. Canada’s banking sector, known for
In the US, the absence of a coordinated conservative lending practices and strong
strategy results in a devolution of equity and capitalization, cannot be implicated in the
distributional concerns to the state and local economic downfall. However, a key fallout
scale. of the mismanaged US banking sector is
the decline in US housing and commercial
Evolving perspectives construction and sales, new car sales, and
world commodity prices. This, in turn, par-
Prior to the Global Recession which began ticularly affects the regional economies of
in 2008, there were key distinctions in how Canada that supply these different segments
the two nations’ local and regional develop- of the US market. Moreover, it is possible
ment practices responded to the challenges that the heated incentives competition for
of climate change, inequality, and globaliza- global capital (Markusen 2007) that has
tion. For example, Canada was one of the been pursued by economic developers in
original signatories of the Kyoto Protocol in both countries in recent decades will be
1998, but the two-term Bush Administration halted.
refused to sign. However, a local level move-
ment begun by the Mayor of Seattle led Prior to the Global Recession’s onset,
to more than 900 towns and cities signing efforts in both Canada and the US to
the treaty by early 2009. Further, five years promote local resilience and sustainability
after Canada signed onto the Kyoto Protocol, were gaining momentum (see, for example,
rising oil prices made Alberta’s oil sand the MacArthur Foundation-funded Building
production commercially profitable for the Resilient Regions network: brr.berkeley.
first time in decades. Oil sand production is edu). In Canada, struggling rural economies
estimated to emit three to five times more were part of the impetus while a key driver
greenhouse gases than conventional produc- of the US movement has been the urban
tion. In the US, green economy initiatives at tragedies of the attack on New York’s World
all government levels are one of the key fea- Trade Towers and financial industry on
tures inserted by the new Obama Presidential September 11, 2001, and Hurricane Katrina
Administration into the multi-billion stimu- hitting New Orleans in 2005. In particular,
lus package initiated by the outgoing Bush Katrina showed just how devastating the
Administration and left for passage and impacts could be on a concentrated urban
implementation by its successor. Beyond the poverty population of a region that misman-
stimulus package, the new Administration aged its flood plains and disaster responses.
quickly began to move to control US green-
house gas emissions. As the major consumer For evolving North American perspec-
of Canadian oil, this move may cause US tives, we can consider whether local and
firms to meet their oil needs elsewhere, regional sustainability and resiliency initia-
thereby creating conflict between the two tives, as well as the megaregion movement,
nations and challenging the possibility of a suggest the emergence of a new regionalism
NorthAmerican Climate ChangeAgreement that seeks to incorporate the perceived con-
to complement the existing Free Trade flicting goals of competitiveness and sustain-
Agreement. ability. In the US, prior even to President
Obama signaling support for green economy
The Global Recession has the potential initiatives, this does appear to be the case.
significantly to alter the path of world devel- However, while it is too soon to know
opment, although the full extent and nature whether these will generate fundamental
of the alteration will not be known for some changes in the theory and practice of func-
tional and territorial regional development,
they clearly warrant close watching.

523

NANCEY GREEN LEIGH AND JENNIFER CLARK

References Doutriaux, J. (2008) “Knowledge Clusters
and University–Industry Cooperation”, in
Atkinson-Grosjean, J. (2002) “Canadian Science at C. Karlsson (ed.) Handbook of Research on
the Public/Private Divide: The NCE Experi- Innovation and Clusters, Northampton, MA:
ment”, Journal of Canadian Studies, 37(3): 71. Edward Elgar.

Bartik, T. (1991) Who Benefits from State and Local Dreier, P., J. Mollenkopf, et al. (2001) Place Matters:
Economic Development Policies?, Kalamazoo, Metropolitics for the 21st Century, Lawrence,
Michigan: The Upjohn Institute for Employ- Kansas: University Press of Kansas.
ment Research.
Fainstein, S. S. (2001) “Competitiveness, Cohesion,
Bingham, R.D. and R. Mier (eds) (1997) Dilemmas and Governance:Their Implications for Social
of Urban Economic Development,Thousand Oaks: Justice”, International Journal of Urban and
Sage Publications. Regional Research, 25(4): 884.

Blakely, E.J. and N. Green Leigh (forth- Feller, I. (1997) “Manufacturing Technology
coming 2010) Planning Local Economic Centers as Components of Regional
Development, 4th edition, Thousand Oaks: Technology Infrastructures”, Regional Science
Sage Publications. and Urban Economics, 27(2): 181.

Bluestone, B. and B. Harrison (1982) The Fitzgerald, J. and N. Leigh (2002) Economic
Deindustrialization of America: Plant Closings, Revitalization: Cases and Strategies for City and
Community Abandonment, and the Dismantling of Suburb, London: Sage Publications.
Basic Industry, New York: Basic Books.
Florida, R. (2002) The Rise of the Creative Class:
Bozeman, B. and C. Boardman (2004) “The NSF And How It’s Transforming Work, Leisure,
Engineering Research Centers and the Community, and Everyday Life, New York:
University-Industry Research Revolution: Basic Books.
A Brief History Featuring an Interview with
Erich Bloch”, Journal of Technology Transfer, Forrest, T.J. (2004) “Regional Theory, Regional
29(3–4): 365. Policy and Southern Poverty”, unpublished
manuscript, City and Regional Planning
Caro, R. A. (1974) The Power Broker, New York: Program, Georgia Institute of
Random House, Inc. Technology, April.

Christaller, W. (1933) Central Places in Southern Friedmann, J. and C. Weaver (1979) Territory
Germany, Jena: Fischer. and Function:The Evolution of Regional Planning,
London: E.Arnold.
Christopherson, S. and J. Clark (2007). Remaking
Regional Economies: Power, Labor, and Firm Globerman, S. (2006) “Canada’s Regional
Strategies in the Knowledge Economy, New York: Innovation Systems: The Science-based
Routledge. Industries”, Canadian Journal of Political Science,
39(2): 432.
CIA – The World Fact Book https://www.cia.
gov/library/publications/the-world-factbook/ Goldfeld, K.S. (ed.) (2007) The Economic Geography
geos/ca.html. of Megaregions, The Trustees of Princeton
University.
Clark, J. and S. Christopherson (2009) “Integrat-
ing Investment and Equity: A Critical Hospers, G.-J., F. Sautet and P. Desrouchers (2008)
Regionalist Agenda for a Progressive “Is There a Need for Cluster Policy?”,
Regionalism”, Journal of Planning Education in C. Karlsson (ed.) Silicon Somewhere: Handbook
and Research, 28 (Spring): 341–354. of Research on Innovation and Clusters,
Northampton, MA: Edward Elgar.
Clavel, P. (1986) The Progressive City: Planning
and Participation, 1969–1984, New Brunswick, Katz, B., M. Munro and J. Bradley (2009)
NJ: Rutgers University Press. “Miracle Mets: How U.S. Metros Propel
America’s Economy and Might Drive Its
Cooke, P. (2002) “Regional Innovation Systems Recovery”, Democracy: A Journal of Ideas,
and Regional Competitiveness”, in M. Gertler Spring 2009, pp 22–35. http://www.brookings.
and D. Wolfe (eds) Innovation and Social edu/articles/2009/0311_metro_katz.aspx,
Learning, New York: Palgrave Macmillan. accessed 18 March, 2009.

Doloreux, D. (2004) “Regional Innovation Lee, S. and N.G. Leigh (2007) “Intrametropolitan
Systems in Canada: A Comparative Study”, Spatial Differentiation and Decline of Inner-
Regional Studies, 38(5): 481. ring Suburbs: A Comparison of Four U.S.
Metropolitan Areas”, Journal of Planning
Doloreux, D. and S. Dionne (2008) “Is Regional Education and Research, 27 (2): 146–164.
Innovation System Development Possible in
Peripheral Regions? Some Evidence from the Malecki, E. J. (2004) “Jockeying for Position:What
Case of La Pocatière, Canada”, Entrepreneurship It Means and Why It Matters to Regional
and Regional Development, 20(3): 259.

524

NORTH AMERICAN PERSPECTIVES ON LOCAL AND REGIONAL DEVELOPMENT

Development Policy When Places Compete”, Salazar, M. and A. Holbrook (2007) “Canadian
Regional Studies, 38(9): 1101. Science, Technology and Innovation Policy:
Malizia, E. E. and E. J. Feser (1999) Understanding The Product of Regional Networking?”,
Local Economic Development, New Brunswick, Regional Studies, 41(8): 1129.
NJ: Center for Urban Policy Research.
Markusen, A.R. (1987) Regions:The Economics and Sassen, S. (2006) Territory, Authority, Rights: From
Politics of Territory, Totowa, NJ: Rowman and Medieval to Global Assemblages, Princeton, NJ:
Allenheld. Princeton University Press.
Markusen, A. (ed.) (2007) Reigning in the
Competition for Capital, Kalamazoo, Michigan: Savoie, D. J. (1986) Regional Economic Development:
W.E. Upjohn Institute for Employment Canada’s Search for Solutions, Toronto: Buffalo,
Research. University of Toronto Press.
Martin, S. and H. Mayer (2008) “Sustainability,
Clusters, and Competitiveness: Introduction to Saxenian, A. (1994) Regional Advantage: Culture
Focus Section”, Economics Development and Competition in Silicon Valley and Route
Quarterly, 22(4): 272–277. 128, Cambridge, MA: Harvard University
Mitchell-Weaver, C., D. Miller and R. Deal Jr. Press.
(2000) “Multilevel Governance and Metro-
politan Regionalism in the USA”, Urban Sussman, C. (1976) Planning the Fourth Migration:
Studies, 37 (5–6): 851–876. The Neglected Vision of the Regional Planning
Newby, L. (1999) “Sustainable Local Economic Association of America, Cambridge, MA:
Development: A New Agenda for Action?”, MIT Press.
Local Environment, 4(1): 67–72.
Orfield, M. (1997) Metropolitics:A Regional Agenda Trippl, M. and F. Tödtling (2007) “Developing
for Community and Stability, Washington DC: Biotechnology Clusters in Non-high
The Brookings Institution Press. Technology Regions – The Case of Austria”,
Perry, B. and T. May (2007) “Governance, Science Industry and Innovation, 14(1): 47.
Policy and Regions: An Introduction”,
Regional Studies 41(8): 1039–1050. Weir, M. (2000) “Coalition Building for
Pike, A. (ed.) (2009) Whither Regional Studies?, Regionalism”, B. Katz (ed.) Reflections on
London: Routledge. Regionalism, Washington DC: The Brookings
Pike, A., Rodríguez-Pose, A. and Tomaney J. Institution.
(2006) Local and Regional Development,
New York: Routledge. Wellar, B. S. (1981) National and Regional Economic
Porter, M. E. (1990) “The Competitive Advantage Development Strategies: Perspectives on Canada’s
of Nations”, Harvard Business Review, 68(2): 73. Problems and Prospects: Colloquium Proceedings,
Porter, M. E. (1998) “Clusters and the New Ottawa, Canada: University of Ottawa
Economics of Competition”, Harvard Business Press.
Review, 76(6): 77.
Reese, L. A. and D. Fasenfest (1996) “Local Wolfe, D. and J. A. Holbrook (2000) Innovation,
Economic Development Policy in Canada and Institutions and Territory: Regional Innovation
the US: Similarities and Differences”, Canadian Systems in Canada, published for the School of
Journal of Urban Research, 5(1): 97. Policy Studies, Queen’s University by McGill-
Reese, L. A. and R. A. Rosenfeld (2004) “Local Queen’s University Press, Montreal.
Economic Development in the United
States and Canada: Institutionalizing Policy Wolfe, D. and J. A. Holbrook (2002) Knowledge,
Approaches”, American Review of Public Clusters and Regional Innovation:Economic Develop-
Administration, 34(3): 277. ment in Canada, published for the School of
Roessner, J. D. (1985) “Prospects for a National Policy Studies, Queen’s University by McGill-
Innovation Policy in the USA”, Futures, Queen’s University Press, Montreal.
17(3): 224.
Rood,S.A.(2000) Government LaboratoryTechnology Zysman, J. and L. D. A. Tyson (1983) American
Transfer: Process and Impact,Aldershot [England], Industry in International Competition: Government
Burlington, USA:Ashgate. Policies and Corporate Strategies, Ithaca, NY:
Sagalyn,L.B.(1997)“Negotiating for Public Benefits: Cornell University Press.
The Bargaining Calculus of Public-private
development”, Urban Studies, 34(12): 1955. Further reading

Blakely, E.J. and N. Green Leigh (forth-
coming 2010) Planning Local Economic
Development, 4th edition,Thousand Oaks: Sage
Publications.

Clark, J. and S. Christopherson (2009) “Integrating
Investment and Equity: A Critical Regionalist
Agenda for a Progressive Regionalism”,

525

NANCEY GREEN LEIGH AND JENNIFER CLARK

Journal of Planning Education and Research, Markusen, A.R. (1987) Regions: The Economics
28 (Spring): 341–354. and Politics of Territory, Totowa, NJ: Rowman
Cooke, P. (2002) “Regional Innovation Systems and Allenheld.
and Regional Competitiveness”, in M. Gertler
and D. Wolfe, Innovation and Social Learning, Markusen, A. (ed.) (2007) Reigning in the
New York: Palgrave Macmillan. Competition for Capital, Kalamazoo, Michigan:
Friedmann, J. and C. Weaver (1979) Territory and W.E. Upjohn Institute for Employment
Function: The Evolution of Regional Planning, Research.
London: E. Arnold.
Goldfeld, K.S. (ed.) (2007) The Economic Geography Mitchell-Weaver, C., D. Miller and R. Deal Jr.
of Megaregions, The Trustees of Princeton (2000) “Multilevel Governance and Metro-
University. politan Regionalism in the USA”, Urban
Lee, S. and N.G. Leigh (2007) “Intrametropolitan Studies, 37 (5–6): 851–876.
Spatial Differentiation and Decline of
Inner-ring Suburbs: A Comparison of Reese, L. A. and D. Fasenfest (1996) “Local
Four U.S. Metropolitan Areas”, Journal Economic Development Policy in Canada and
of Planning Education and Research, 27 (2): the US: Similarities and Differences”, Canadian
146–164. Journal of Urban Research, 5(1): 97.

Sassen, S. (2006) Territory, Authority, Rights: From
Medieval to Global Assemblages, Princeton, NJ:
Princeton University Press.

526

44

Area definition and classification and
regional development finance

The European Union and China

Michael Dunford

Introduction degrees of interdependence and strong com-
plementarities. Examples include market areas
Area development policies are widely imple- that combine market centres where the func-
mented. In each case such measures involve tion is performed and the places in which
the definition and classification of geogra- the people who use those market centres
phical areas, the establishment of information reside.A classic case is afforded by Christaller’s
systems to support policy initiatives, the deter- (1933) theoretical account of the size,number
mination of strategic policy goals, the estab- and spacing of market centres and market
lishment of policy instruments and the areas in Southern Germany. Another exam-
allocation of financial and other resources to ple is a travel-to-work area which combines
plan, implement, monitor and evaluate the places of employment and the places where
measures adopted. The aim of this chapter the people who work in those places of
is to deal with two of these dimensions of employment live. As this definition implies,
area development policies: the definition functional areas are essentially city regions.
and classification of areas and the allocation
of financial resources. These issues will be The degree of emphasis placed on func-
considered in relation to the experience tional definitions of regions varies. In part
mainly of the European Union but also of this variation reflects the shifting relative
contemporary China. importance attached in geography to the
study of regions as self-contained entities (as
Defining regions in the regional tradition and more recent
‘territorial’ approaches to regional develop-
A region is essentially a part of the land ment studies) and as places that can only be
surface of the earth. In the geographical understood in terms of their relationships with
literature regions are defined in three ways as, other places (as in the locational tradition
respectively, uniform, functional and admin- and in recent relational approaches to eco-
istrative areas. Most useful for economic nomic geography) (Wrigley, 1965; Pike, 2007).
development purposes are functional areas
which combine places characterized by strong Although functional definitions are from a
scientific point of view the most useful, most
used are regions defined for administrative
purposes. Once a regional division is put in

527