REPORT LAUNCH
We are glad to inform you that The United Nations Human Settlements Programme - UN-Habitat will launch “The State of the European Cities in Transition: Taking stock after 20 years of reform” report next Tuesday 9th October 2013 between 11:30 and 12:30. The event is hosted by the Permanent Representation of Lithuania to the European Union in Brussels, Rue Belliard 41-43.
The report offers an overview of the urban trends, conditions and opportunities of 23 post-sovietic countries. Most of these countries entered in haste the transformation of their centrally-planned economies into market-based systems. This led to sudden decentralization, privatization and rapid urban change. The Baltic States, the Visegrád countries and some countries in the Eastern Balkans are today members of the European Union. Others in the region are either candidates for EU membership or aspiring future members. Regardless of their current status, they are required to address the emerging urban agenda of the EU as exemplified by the Leipzig Charter and the debate over territorial cohesion. The State of European Cities in Transition Report 2013 provides an overall stock taking of trends and conditions, after two decades of reform, describing the state of the cities and providing policy-sensitive recommendations for elevating urban issues on national and regional agendas.
20 YEARS AFTER SOCIALISM: THE NEW EU MEMBERS ARE THE WINNERS
Today, the United Nations released its report: The State of European Cities in Transition 2013: Taking stock of 20 years of reform. In this publication, the UN-Habitat analyzes the impacts on the cities of the 23 countries and territories of transitional Europe that in the early-1990s embarked on their transition from Socialist centrally-planned economies to democratic and market-based systems.
Although all transitional countries of Europe have made remarkable progress over the past two decades, the report notes that the reforms - while broadly considered urgent - were implemented with too much haste. Driven by the desire to quickly establish democratic and market-based systems and rapidly pass through this transition, short-term political time horizons and opportunistic interventions have frequently compromised sound longer-term policy-making. The impacts of these early decisions are becoming increasingly evident in Eastern Europe’s complex political, economic and social realities.
In the early 1990s, there was widespread belief that free markets would resolve most of the urban problems in transitional Europe. This proved incorrect and with the broad reforms now mostly in place. Europe will have to decide whether market forces alone can resolve Eastern Europe’s still daunting urban, housing and social problems. It needs to be decided how regulation and new interventions can address the many undesirable societal outcomes that transition has brought, especially the increasing economic inequality and political exclusion.
Improving political, economic and social standards was among the main objectives of the transition. But better conditions neither reached all strata of society nor all parts of these countries evenly, the UN report concludes. Inequality has increased because economic growth typically concentrated in the capitals and other large cities. Small and intermediate-size cities continue to have great difficulties keeping up because they do neither have the diversified urban economies of their larger counterparts nor equal access to the foreign investment that made it easier for the larger cities to compete with Europe and the world.
Rapidly-growing differences in well-being have caused depopulation of economically depressed small and intermediate cities and rural areas, especially by young people. This led to sharply declining fertility rates not only because large shares of the reproductive age groups left, but also because childbirth has often been postponed for economic reasons.
Overall population trends in transitional Europe therefore show significant demographic ageing. With large numbers of young, economically active and reproducing people leaving, the share of elderly has increased rapidly, particularly in rural areas and smaller towns. This will have major implications because the costs of elderly care, health and pensions will have to be borne by declining productive populations. Also, depopulation in some areas of Eastern Europe has been so severe that future repopulation may have been compromised.
The UN report notes that the larger cities of the 2004 entrants to the EU (the Baltic States, Poland, Hungary, the Czech Republic, Slovakia and Slovenia) have generally performed better than the cities of non-EU member states. Several of these larger cities have moved through the transition quite well and are now among Europe’s economically more dynamic urban areas. Their economic performance was less determined by the degree of privatization but more by foreign and domestic investment flows. Investments focused on these cities because of their well-educated and adaptable but still cheap labour forces; their superior infrastructures; and their rapid economic, legal and financial adaptation to market forces.
The largest cities in Central-Eastern Europe are the clear winners of transition, the report concludes. But at a price, because economic growth in the larger metropolitan areas of Eastern Europe went at the expense of the small and inter-mediate cities and contributed to increasing economic inequalities. Moreover, investments in Eastern Europe have not always lead to positive outcomes. Some industries where bought up simply to be shut down by their new owners to eliminate competition, adding to local unemployment and hardship.
Full report available as a free pdf at
PRESS RELEASE 2 (EMBARGOED UNTIL 07 OCTOBER 2013)
ALL HOMEOWNERS NOW BUT MANY TOO POOR FOR THEIR HOUSING
Today, the United Nations released its report: The State of European Cities in Transition 2013: Taking stock of 20 years of reform. In this publication, UN-Habitat analyzes the impacts on the cities of the 23 countries and territories of transitional Europe that in the early-1990s embarked on their transition from Socialist centrally-planned economies to democratic and market-based systems.
Transition has brought much turmoil, including the breaking up of the former Yugoslav Republic, which exploded in conflict, war, death and displacement. Many industries and manufacturing processes throughout transitional Europe collapsed when exposed to European and global competition. The latter proved particularly traumatic for cities whose economies were based on a single industrial sector. Almost overnight, such cities saw their factories closing and jobs disappearing, causing an exodus of their mostly young and entrepreneurial inhabitants. Out-migration and depopulation in some economically depressed areas of transitional Europe has been so severe that insufficient people may be left to assure future repopulation.
Transition also brought widespread privatization of the formerly state-owned housing stock. Sitting tenants became the owners, either for free or against a low fee. But the UN report notes that housing privatization occurred far too quickly and mostly unregulated. Today, many house-owners in transitional Europe are simply too poor for house ownership and many are now threatened with eviction.
Housing privatization has been too radical and most transitional European countries now have far too few affordable public social housing units for their vulnerable inhabitants. Central and Eastern European countries now need to urgently build urban social housing for the needy. With most urban households living in apartment blocks from the Socialist period, a near total lack of maintenance provisions for the shared facilities of these ageing flats has led to severe upkeep backlogs. Overall housing quality is therefore rapidly deteriorating and many Socialist-era apartment buildings have turned into ‘vertical slums’.
The report also notes that, after 1990, residential and housing-related costs in most transitional countries have generally risen much sharper than incomes. Domestic energy and utility costs grew particularly fast, partly due to price liberalization and partly as the outcome of monopolistic public sector companies pursuing their institutional interests. This has led to particularly difficult problems in multi-family buildings, where water, heating, energy and services bills have to be shared among all occupants. Housing allowance subsidies proved unable to bridge the widening affordability gaps.
Housing finance in Europe’s transitional countries, the report concludes, is also deeply troubled. Privatized banks indiscriminately provided mortgages and so contributed to rapid house price increases and speculative house purchases, especially in the economically dynamic larger cities. Moreover, many borrowers obtained mortgages in Euros or Swiss Francs because of their lower interest rates if compared to national currencies. Many of these borrowers got into trouble during the 2008/9 financial crisis when changing exchange rates pushed up the monthly mortgage payments. Hungarian foreign currency borrowers, for instance, experienced a 30 to 40 per cent increase in their mortgage payments. Subsequent and widespread defaulting led to rising numbers of foreclosures and the subsequent bursting of house price bubbles.
Full report available as a free pdf at
PRESS RELEASE 3 (EMBARGOED UNTIL 07 OCTOBER 2013)
EASTERN EUROPE: CLEANER BUT FAR FROM CLEANEST
Today, the United Nations has released its report: The State of European Cities in Transition 2013: Taking stock of 20 years of reform. In this publication, UN-Habitat analyzes the impacts on the cities of the 23 countries and territories of transitional Europe that in the early-1990s embarked on their transition from Socialist centrally-planned economies to democratic and market-based systems.
The UN report notes that transitional Europe has made great strides in addressing its notorious air, soil and water pollution. But much still remains to be done and especially the quality of urban air remains a matter of growing concern. The closure of many bankrupt heavy industries was an environment-friendly act. But transportation became the next major source of air pollution, mostly on account of the old vehicle stock. Motorization in Eastern Europe has increased dramatically over the past two decades due to growing mobility demand associated with suburbanization. This has lead to sharply increasing levels of PM10 and other airborne particles in most of the larger cities. More investment in urban public transportation systems could relieve these problems.
Radical shifts to address climate change have neither occurred nor are expected soon. Eastern European cities mostly show little interest because few experience any direct threats. Since almost two-thirds of the transitional region’s population is urbanized, cities’ compliance with the EU 2020 targets would be of paramount importance. Therefore, national policy reform is required in all transitional countries to help municipalities improve their air quality, waste management and energy efficiency. Urban brown field redevelopment is another urgent matter to be addressed so that polluted and abandoned urban areas can be used for urban redevelopment.
With rising oil and gas prices, the report notes, improving urban energy consumption and efficiency should become a priority. Households are the main energy consumers because housing stocks are mostly old, energy-inefficient and equipped with energy-intensive appliances. Energy inefficiencies in district heating are of particular concern, with systemic losses up to 88 per cent recorded. Also, given the climatic conditions in the Baltic States, energy saving through improved house insulation could be very significant.
Waste water and solid waste disposal also remain problematic in many cities throughout transitional Europe. That is particularly the case among the smaller municipalities who typically lack the capacities to adequately deliver these services. Connections to sewerage systems, for instance, vary widely throughout transitional Europe but, at only 39 per cent, are worryingly low in Montenegro. Albania performs similarly poorly in this respect, with less than two-thirds of the housing stock fitted with an indoor toilet.
Full report available as a free pdf at