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Subregion Jelenia Góra As an Example of Border Region - Case Study Report

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Subregion Jelenia Góra As an Example of Border Region - Case Study Report Working Paper Series Serie 6 Spaces, Territories and Regions Paper No. 6.03.02.01 Subregion Jelenia Góra as an Example of Border Region - Case Study Report Marek W. Kozak* *Centre for European Regional and Local Studies (EUROREG), University of Warsaw 2014 www.grincoh.eu This paper was funded under the FP7 project “Growth– Innovation – Competitiveness: Fostering Cohesion in Central and Eastern Europe (GRINCOH)” under the Programme SSH.2011.2.2-1: Addressing cohesion challenges in Central and Eastern Europe; Area 8.2.2 Regional, territorial and social cohesion. Project Nr. 290657 Marek W. Kozak, [email protected] Centre for European Regional and Local Studies (EUROREG), University of Warsaw www.euroreg.uw.edu.pl Please cite as: Kozak M.W., (2014), ‘Subregion Jelenia Góra as an Example of Border Region - Case Study Report’, GRINCOH Working Paper Series, Paper No. 6.03.02.01 Subregion Jelenia Góra as an Example of Border Region - Case Study Report1 Abstract Jelenia Góra subregion (NUTS 3) is part of the Dolnośląskie Region and borders on Germany (Saxony) and Czech Republic. Subregion underwent lengthy and difficult restructuring with serious social aftermaths. Jelenia Góra is in relatively best shape (together with border town of Zgorzelec), but the region as a whole is among the least developed in South-Western Poland. It still has significantly developed industrial sector but it is low-tech producing. The region is neither innovative nor competitive, suffers from high unemployment rate, has underdeveloped high schools and R&D institutions. Despite all appreciated support from the EU and national budget, its impact is felt mainly in the quality of live, and not in the desirable structural change of the economy and its modernisation, increased innovation and competitiveness (except for some tourist initiatives). Subregional and local authorities turned out to be unable to use external support to restructure and modernize the economy. Content 1. Introduction ........................................................................................................................ 2 2. Trajectories of economic development and structural change, social cohesion ............... 5 3. Development factors ........................................................................................................ 12 3A. External context of development: trade and FDI .............................................................. 13 3B. Endogenous growth factors: innovation and entrepreneurship ....................................... 15 4. Governance and local/regional development policies ..................................................... 16 5. External interventions: national policies and EU cohesion policy .................................... 19 6. Future prospects ............................................................................................................... 21 7. Conclusion ......................................................................................................................... 22 LIST OF INTERVIEWED INSTITUTIONS: ..................................................................................... 25 REFERENCES ............................................................................................................................. 25 1I would like to thank Ms Ilona Stańczyk for her valuable help in organising the meetings. 1 Abbreviations: CAP – Common Agricultural Policy CBC – cross border cooperation CP – Cohesion policy CZSO – statistical office of the Czech Republic (equivalent of CSO, central statistical office) Desk research – analysis of materials (publications, reports, documents) EFRD – European Fund for Regional Development ESF – European Social Fund EU - European Union FDI - foreign direct investments FTE – full-time equivalents GDP – gross domestic product GVA – Gross Value Added IDI – in-depth interview LAU – local administrative unit (LAU 1 – counties [powiaty]; LAU 2 – municipalities [gminy]) MLG – Multi-level Governance NPM – New Public Management NUTS – Nomenclature of Territorial Units for Statistics 0, 1, 2, 3), where NUTS 3 is a subregion, and NUTS 2 is a region R&D - research and development ROP – Regional Operational Programme 1. Introduction This report was prepared on the basis of information from a number of sources obtained using varied tools,such asdesk research, statistics andIDIs. The aim was to combine quantitative and qualitative data to describe the situation more accurately and better explain the observable phenomena. The basis sources of statistical data included Eurostat and GUS – the Polish Central Statistical Office. Qualitative information comes mainly from nine in-depth interviews (IDIs), conducted in September 2013 with experts and practitioners in the specific areas in the subregion (NUTS 3) and in the regional capital, Wrocław. All other information sources are referenced in the text. 1.1. Location and history The Jelenia Góra subregion occupies an area of 5600 km²and forms a part of the Dolnośląskie (Upper Silesia) Voivodship (województwo) situated in south-western Poland (Figure 1). In 2012, it had a population of 579,635. The subregion borders on the Federal Republic of Germany in the west and on the Czech Republic in the south. The southern part of the subregion is occupied by mountains, including the highest range of the Sudeten (Sudety), the Karkonosze (Krkonoše). The subregion’s main city is its capital, Jelenia Góra, with a population of approximately 83,000. Other major cities include the seats of counties (powiat): Bolesławiec (39,000), Zgorzelec (31,000), Jawor (24,000), Lubań (22,000), Kamienna Góra (20,000) and Złotoryja (16,000).The international road Warsaw- Prague (E365) intersects the Jelenia Góra subregion, while the A4 motorway (Kraków- Bolesławiec- Zgorzelec-Drezno) runs in its northern part (near Bolesławiec) so as the A18 section connecting the subregion with Berlin. The future S3 expressway (planned to be upgraded to the expressway standard in the coming years) leads from the Baltic Sea coast to the Czech Republic along the subregion’s eastern parts, via Jawor and Kamienna Góra. The central and eastern parts of the subregion do not have good transport connections with the regional capital, Wrocław, nor with other metropolises in the area. 2 In the Middle Ages (until the 12th century), the subregion formed a part of the Polish monarchy, and later, in the period when the Polish state was divided into autonomous principalities, it was an object of rivalry between Poland, Bohemia and Germany, ultimately won by Bohemia. Later, it was incorporated together with Bohemia into the Austrian Empire and, after the Silesian Wars in the mid- 18th century, into Prussia (and then Germany). In 1945, following the Allies’ decision, the subregion became part of Poland together with Upper Silesia; the German-speaking population was expelled and replaced by Polish population (including people resettled from the territory which was earlier Eastern Poland). As a result of these post-War events, the once strong ties between Berlin and Dresden were considerably weakened, not to be re-established until 1989, and notably until 2004, the year of Poland’s EU accession. The sealed borders, isolation and hostile propaganda, pursued by the Czechoslovakian authorities particularly from the beginning of the “Solidarity” era in Poland (1980) practically until the systemic transition of 1989, were all factors that effectively crippled any existing cross-border ties and linkages. Figure 1. The Jelenia Góra subregion inthe Dolnośląskie Voivodship (http://goo.gl/juhZEiaccessed on 11.12.2013) 1.2. Basic socio-economic characteristics As mentioned above, the subregion has a population of ca. 580,000. Its capital,Jelenia Góra, has about83,000residents, and over 100,000if the functional ties are considered. In the last decade, the number of the population both in the city and in the subregion has decreased, due, first, to the migratory outflow, which, at least according to the official statistics2, is rather insignificant, and, second, to negative demographic growth. Population density is 103 persons per 1 km², which is much 2The official statistics much underrate the volume of foreign migration (by as much as several times, according to some sources). 3 lower than the national (122 persons per 1 km²) and regional average (146 in 2011)(US Wrocław 2012b). The employment in the subregion totalled 194,000. Its level of economic development is rather low, with per capita income of only EUR 7,500 in 2010, i.e. 80% of the national average. This is largely due to a considerable fall in the role of financial service and real estate activities (representing a 6.3% reduction in GVA creation in 1999-2010) and a dwindling share of agriculture (which shrank by 1.7pp in the analysed period). Quite importantly, the diminishing significance of agriculture was accompanied by a relatively slight reduction in employment in this sector (down to 16,800 in 2008). Employment gradually increased in trade, tourism, transport and industry and was relatively stable in public services (generating 19.4% GVA, with employment at a level of 43,500). An increased role of employment in trade and tourism is a consequence of the development of the tourist function in the subregion (including cross-border tourism and shopping tourism). Nonetheless, the gross salary in the industrial sector is lower than the Polish average and, worse still, in the period 2007-2011 it fell from 87.3% to 83.6% of the national
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