Corridors and Tech Regions: International Case Studies
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CORRIDORS AND TECH REGIONS: INTERNATIONAL CASE STUDIES GREATER COPENHAGEN AND SKÅNE - THE ØRESUND GREATER COPENHAGEN AND SKÅNE: THE ØRESUND REGION (DENMARK AND SWEDEN) > CREATING A LARGER FUNCTIONAL ECONOMY Creation of a larger functional economy with new regional The new regional brand identity may be losing relevance. As of brand/name. With a total population of 3.6 million, the Øresund is January 1st 2016 the Øresund Committee will officially be renamed one of the most well-known example of European cross-border to the Greater Copenhagen & Skåne Committee. collaboration, building on the metropolitan area around Infrastructural improvements are an essential driver for regional Copenhagen and, across the sound, southern Sweden following integration and competitiveness, but are not sufficient on their the opening of a fixed-link bridge/tunnel in 2000. own. Wider policy efforts were needed to connect the assets and The collaboration aimed to create critical mass and increase the capabilities in the enlarged region. Many of the initiatives in the ‘effective density’ of the Greater Copenhagen area. Benefits Øresund have been to create networks and collaborative include agglomeration economies by creating a larger platforms. metropolitan region, with an integrated labour market, serving to The growth and benefits from integration have tailed off. The overcome the disadvantages of the area’s peripheral location in bridge, while initially the catalyst for greater integration, is no global terms. longer sufficient. After integration jumped in the years following Building a large, more integrated knowledge economy. The the bridge opening, the crisis and changing price differentials have Øresund Region is a technology hub with innovation potential, contributed to the current stagnation in integration and cross- world-class scientific infrastructure and a good environment for border mobility. start-ups. The Øresund accounts for a large share of total Swedish Without wide buy-in from all levels of government and policy and Danish R&D. Life sciences/medical tech employs 40,000; ICT communities, progress is not assured. The Øresund has benefited employs 100,000. from EU funding and initiatives due to its transnational nature. Apparently, support from national and regional governments has not been as overt or integrated as necessary. 1 GREATER COPENHAGEN AND SKÅNE: THE ØRESUND REGION (DENMARK AND SWEDEN) > CREATING A LARGER FUNCTIONAL ECONOMY Introduction The Øresund is one of the most well-known example of European cross-border collaboration, building on the metropolitan area around Copenhagen and, across the sound, southern Sweden with the cities of Malmö, Lund and Helsingborg. Cross-border integration intensified following the opening of a fixed-link bridge/tunnel in 2000. As of January 1st 2016 the Øresund Committee will officially be renamed to the Greater Copenhagen & Skåne Committee. The Øresund region has a population of 3.6 million people (the Skane Region of Sweden, and the Sjaelland region of Denmark), and was created by the construction and opening (in 2000) of a road and rail bridge linking Copenhagen/Zeeland (Denmark) and Malmo/Skåne (Sweden). Until the opening of the Øresund Bridge, commuting across southern Øresund was limited with only around 2,000 people living in one country and working in the other. The increased accessibility offered by the fixed link enabled far more people to commute across Southern Øresund within an acceptable journey time – with commuting has rising tenfold so that by 2009, almost 20,400 people commuted to work or to college/university on the other side. Commuting is highly one-directional, with around 95 per cent of all commuters living in Sweden and working in Denmark. An interesting feature is the development of industry-specific corridor initiatives – such as Medicon Valley, a life sciences industrial development zone. During the first years following the opening of the Øresund Bridge, growth in commuting was largely driven by differences in property prices between the two countries, which resulted in many Danes relocating to Scania while continuing to work on the Danish side. A capital with 1.3 million inhabitants, Copenhagen offers a diverse labour market with higher salaries and greater job opportunities compared to Malmö. This is, of course, attractive to Swedish job-seekers. It was, however, not until 2005 that Swedes began to make an impact on the Danish labour market when the booming Danish economy forced many employers to recruit Swedes. A few small companies even chose to move their production to Scania to get access to the workforce they needed. 2 The economy and rationale for spatial integration The OECD1 has argued that many of the pre- conditions for a functional region area present: Physical internal accessibility, thanks to the Øresund Bridge External accessibility, thanks to Kastrup Airport Similar levels of economic development Similar industry specialisms and activities There have been efforts to build an “Øresund identity” in a culturally and linguistically similar but still diversified population stand high on the political agenda, albeit the sense of an Øresund identity appears to be much higher on the Swedish side. The main rationale for establishing the Øresund region is to achieve greater critical mass. These include the benefits of agglomeration economies by creating a larger metropolitan region, with an integrated labour market, serves to overcome the disadvantages of the area’s peripheral location in global terms. Although Copenhagen is a large city, it is small by global standards. Common drawbacks of metropolitan regions relate to congestion costs as well as higher land and housing prices. The Øresund actually helps relieve these pressures by combining the advantages of a successful metropolitan economy with an extended hinterland (Malmö-Lund). Exploiting complementarities in knowledge assets is another driving force for the Øresund that can benefit both sides. The bi-national life science cluster is a flagship initiative within the Øresund, supported by the Medicon Valley Alliance (MVA), which contributes to the region’s international visibility. While the MVA promotes external linkages to global life science knowledge hubs, there is a view that the potential for collaboration projects across the border remains under-exploited2, in part due to the loss of a key pharmaceutical player on the Swedish side (AstraZeneca). Actors in other sectors, such as food, ICT and cleantech, are also working towards the goal of mobilising their strengths to reap benefits from cross-border collaboration, but lessons should be drawn as to why 1 Nauwelaers, C., K. Maguire and G. Ajmone Marsan (2013), “The case of Øresund (Denmark-Sweden) – Regions and Innovation: Collaborating Across Borders”, OECD Regional Development Working Papers, 2013/21, OECD Publishing. http://dx.doi.org/10.1787/5k3xv0lk8knn-en 2 Ibid. 3 several previous cross-border cluster associations have essentially reverted back to only one side of the Øresund. Branding is another goal in the Øresund project. From the mid-1990s, many “O” organisations and initiatives were born to give life to the “Øresund” brand. This has been used for developing an internal identity and networking. It has also helped with international profiling, along with the MVA. Several possible new brand names for the region have been under discussion. Key industries and the knowledge-based economy Both Danish and Swedish sides of the sound share similar levels of development and types of industry. They both have knowledge-based economies, with strong universities and innovative companies. Regional strategies across the area share many similar economic development priorities for high-tech areas in life science, ICT, material science and clean technology. The Øresund Region is a technology hub with excellent innovation potential, world-class scientific infrastructure and a good environment for start-ups. The Øresund accounts for a large share of total Swedish and Danish R&D: its R&D expenditure (4.9% of GDP), mainly of private origin (73%), outperforms national figures. The Øresund has a critical mass of workers in high-technology sectors among its already well-educated labour force. The bi-national region is characterised by a concentration of research-intensive multinational companies, innovative SMEs, and leading higher education and research institutions, specialised in life science and ICT. Pharmaceuticals and electro-medical equipment are its most important high-tech specialisations. Large infrastructure adds to the scientific potential and high-tech image of the region: two large scientific facilities for materials science research are being built, MAX IV and the European Spallation Source (ESS). Their reach extends much further than the cross- border region, but efforts are devoted to stimulate spillovers from the new infrastructure to regional companies. They are also giving a reason for the Danish side to look towards its “little brother”, Skåne, where the facilities are located. Several incubators and other initiatives exist on both sides of the straight to support start-ups in knowledge-based activities. The main technology- or knowledge- based industries where there is a significant presence include: Life sciences and medical technologies: 3 regions, 12 universities, 32 hospitals, over 300 bio/medtech companies with R&D and/or production and over 40,000 employees. Dedicated industry cluster organisation – Medicon Valley Alliance