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Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
Future Forum 2013 - Debra Mountford
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Future Forum 2013 - Debra Mountford

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  • 1. Adjusting to new economic realities: local growth and investment strategies. Debra Mountford Udine, 2013
  • 2. A challenging context for local development • Local economies confronted by serious challenges in the pursuits of viable economic growth and job creation. • Local government budgets have been reduced. • National level funding streams and redistributive grants have diminished. • Access to private capital more demanding and risk averse.
  • 3. Lessons from our work • • • • • • Growth Strategies Investment tools and trends Economic leadership City approaches Challenges for national governments The changing role of the private sector.
  • 4. Growth Strategy (1) More strategic cluster consolidation capable of growing employment – Improved pathways for intra-sector sharing of technology and investment opportunities (2) Clearer support for SME research base around leading universities - commercially profitable synergies - More self-conscious HE cluster - international students/universities. (3) Growing jobs base by maximising reach into new global markets – pathways (events, missions, new air routes) for executives and business tourists – local businesses as international ambassadors and advocates
  • 5. Growth Strategy Economic Board • • • Integration along 2 development corridors ‘Humuslaag’- densification of research Conversion of office space • Amsterdam 7-sector approach with Amsterdam Barcelona Key initiatives Start-up culture: financing, employment markets, space China outreach round-table Mobile World Capital Barcelona Creixement (Growth) 30• point plan • Boston Brisbane • 2031 Economic Development Plan Cape Town Economic Development Strategy Hamburg Innovation District Create Boston, single PoC • • • Conventions and cultural events Programme for Asian resource firms Digital Economy governance • • Metropolitan public transport corridors Radically improve the skills base. • • Cluster strategy in aviation, maritime, renewables Upgrade of port Initiatives of City of Boston and BRA • Vision Hamburg - Responsible Growth
  • 6. Growth Strategy Manchester Greater Manchester Strategy Lyon Nanjing Devised with CoC, the Univ/Lyon, and business groups Key initiatives • • • Expand trade links - China, India, ME Grow Oxford Road science corridor Employer-led skills programmes • • • La Part-Dieu and Confluence districts BIOASTER institute of research Business ambassadors Live business development strategy • since 2009 • 321 Talent Plan to attract 3,000 entrepreneurs by 2016 Attract anchor engineering institutions • • World-class cluster groupings High-speed rail links with Gothenburg and Copenhagen • • • Qianhai – major new financial zone Large expansion of HE $2bn Creative Valley project Oslo Untitled Shenzhen Implemented through Five-Year Plan Zurich Metropolitan initiatives + Strategien • • Zurich 2025 Integrate clean technology cluster Expand spatial access for creative industries
  • 7. Investment Tools and Trends Public investment •Retention of revenues generated within metropolitan area (eg. Manchester) •Decentralisation of nationally/provincially-held infrastructure funding mechanisms(Zurich) •Pursue core projects by trimming budgets (Amsterdam). •Consolidatation of regional investment capabilities (Cape Town) •Investment in training to maintain private sector jobs (Hamburg) Private investment •Privately-backed funds to grow science sectors (e.g. Amsterdam, Lyon and Nanjing). •Business-friendly Zones with favourable tax offerings and high accessibility (e.g. Manchester, Boston) •Competitions, accelerators and investment forums to better connect start-ups to private funds (e.g Lyon, Barcelona)
  • 8. Main sources of investment since 2008 What’s changed? Amsterdam • • American investment leads in ICT, creative, finance. Twice as many Chinese companies investing Barcelona • • Netherlands, US and France - key sources in software, • Grasp of Barcelona’s potential as a chemicals, imaging, automotive, agrifood gateway to Mediterranean €500m Hong Kong investment in Port expansion. Boston • • • Developers instrumental in innovation district Influx of European life science firm investment Harvard Business School support from Tata Group Brisbane • Foreign and institutional investment mostly active in • Firms seek direct exposure quality central property assets, and toll road PPPs thriving Queensland economy Cape Town • • Banks primary funders of central city overhaul Convention Centre precinct €500m, private-led Hamburg • Logistics and industrial firms engaged in office- • Increase in private house-building building projects • More Korean and Japanese Open-ended real estate funds very active investment in energy/shipping • • Strong, growing Japanese logistics presence around airport. • Funding more school tuition • Summer internships scheme • Surge in wind/photovoltaic sectors • New interest from S.A./ Singapore to
  • 9. Main sources of investment since 2008 What’s changed? Manchester • Reliance on expanding US firms, also German and • Recognition as a cheaper and viable Italian, esp.ICT, life sciences, advanced location for headquarters manufacturing Lyon • • French biotechnology firms Fast growing SME setup in e-commerce Nanjing • Most foreign investment through Development Zone. • Investment higher up the value chain in software and outsourcing. Oslo • • Investment in cultural flagship projects Surrounding niche financial services • Large real estate investment influx due to stability and low debt Shenzhen • • • Japanese investment in retail, electronics. MNC interest in business-equipped offices HK and global financial firm interest in Qianhai • FDI boom in real estate, vehicles • Recognition of Qianhai Zone’s regulatory advantages Zurich • • • Established tech firms show more support for SME and start-ups Swisscom CHF300m investment in fibre-optic network • More partnered investment in Local investment from headquarter bodies: e.g. FIFA cultural institutions
  • 10. Public investment tools Amsterdam Barcelona Boston • Scholarship Fund, 50% local govt, to attract PhD-level talent • Pla Empenta – redirects €80m of local funds from investment budget into housing, to attract €300m private investment • Brisbane • Cape Town • Hamburg • Relies on state government for capital grant funding for life science/transport Accelerated shared city-state-federal funding for road tunnels, resurfacing Pool resources at provincial and city level City’s own VC company for SMEs (BTG Hamburg) supports companies’ equity base. Private investment tools • Life Sciences Fund - investment capital to early-stage biomedical firms. Backed by major banks • • Barcelona City Protocol - certification system Tax Free Zone for mobile technology start-ups • Up to 20% tax cuts for Innovation District firms MassChallenge $1m entrepreneur competition • • • 40-45% R&D tax offset for mining sector 3-year moratorium on hotel developer charges • • From Red Tape to Red Carpet Building upgrade cost offset in UDZs • Employee Qualification Programme, funds up to €3k of training per employee Programme to support high-risk SME tech start-ups •
  • 11. Public investment tools Manchester • • • Lyon Nanjing Private investment tools ‘City Deal’ to earn back up to £30m/yr £300m Evergreen fund using pension fund • investment Regional Growth Fund • • City of Entrepreneurship programme ‘Future Investments’ for funds in edu, digital • Re-organisation of SOEs to improve efficiency of large-scale housing and transport projects • • • • Oslo • • Toll fare increase to fund road tunnels • €100m state fund for life science start-ups • Shenzhen • 3-5 year bond tranches as a check on local government debt Zurich • Rail Infrastructure Fund to integrate funding governance + waive interest on debt financing • High-tech Enterprise Zone around the airport, offering 5-year business rate discounts BoostInLyon start-up accelerator €90m in BIOASTER microbiology institute Personal financial incentives of €120k 50% loan interest offset for small firm incubation new regional Knowledge Partnership National R&D tax credit scheme - SkatteFUNN • Creation of coastal development zones, with simplified tax system, more liberal HR laws Relocation subsidies for IT firms • tax assistance for some entrepreneurs
  • 12. Delivery and organisational adjustments Overcome political fragmentation through integrated city-regional bodies -Increased applicability and efficacy of innovation and mobility strategies -Shared ideas about integration and regional identity (Zurich, Lyon) -Pathway for dedicated and evidence-led private sector input (Manchester, Cape Town) -More professional approach to the fundamentally metropolitan and commercial character of economies. -Overturning the lack of shared vision and co-operation between stakeholders. Cluster agglomeration as driver of strategic cooperation across political boundaries. (eg Zurich) Improved relations with higher tiers of government: delegated powers (Oslo, Brisbane, Hamburg) More influence for expert development agencies over workforce development, landuse and infrastructure (Boston)
  • 13. How has national/regional government role changed? Amsterdam • Commitment to specific core projects (especially logistics and transport-related) Barcelona • Emergency debt-relief financing support Boston • Growing amount of state aid (from Massachusetts) Brisbane • • Queensland state government more attuned to city needs Incremental devolution of planning and tourism powers Cape Town • • Delegation of greater transport and housing powers Sharing national fuel tax with local government to replace council levies Hamburg • Recognition of cluster competitiveness to complement infrastructure support Manchester • More competition for funding based on economic case. City beginning to be more successful in bids. Lyon • More targeted funding for a handful of growth sectors Nanjing • More national support for software ambitions Oslo • Preparation of SMEs for international competition Shenzhen • • • Recognition of functional economic region size of Guangdong Province Permitted creation of joint ventures Regulatory relaxation in Qianhai Zone Zurich • Overcoming deadlock over funding channels and arrangements for key infrastructure projects
  • 14. A new kind of leadership New ethos of pragmatism •Compromises to improve the coherence of cluster and mobility strategies •Mindful of previous over-ambition •More astute lobbying for favourable national/federal investment Lead the agenda for open-ness •Communicate value of diversity and high-value immigrant workers for value chain position Positive and authentic engagement with private sector •Business support and market knowledge to re-assure end-user firms/investors Commitment to sound fiscal platform •Careful stewardship of balance sheets, projection of reliability and consistency Long-term, multi-cycle approach •encourage reflection on core assets
  • 15. What’s needed from national government? • Local business climate and stable framework conditions • Rationalisation of complex policies and programmes into simple-topursue frameworks • National-level transport infrastructure investment (greater fiscal and organisational authority over transport needs) • Initial investment in niche higher education facilities • Recognition of practical economic geographies • Facilitate expansion of the private rented housing sector • Evidence-based and trend-based rather than politicised approach to local economies
  • 16. What’s needed from the private sector? • Grasp the changing economic requirements of local areas. • Foster a competitive business climate • Support the internationalisation process with specialist knowledge • Activity and leadership in the housing sector • Address the jobs challenge for young people • Become a systematic strategic partner

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