Published on March 17, 2009
Cornwall : Cornwall Objective One Background : Background In 1999, Cornwall was successful in gaining EU Objective One funding. Objective One aims to reduce social and economic differences within the European Union (EU). The funding comes from the EU and is granted to areas where the GDP is 75% of the EU average. How does Objective One Work? : How does Objective One Work? Investors start the process and then apply for equal amounts of money from other sources, known as match funding. For Example: Set up with £20,000 of their own money ? Get a bank loan for another £20,000, creating £40,000 ? Ask local councils to match it to make £80,000 ? Bid for the South West Development Agency to match it to £160,000 ? Finally, bid for Objective One funds to match it, creating £320,000. How Successful has it been? : How Successful has it been? The Cornish Economy has grown faster than the UK average. It has grown at 5.8% from 1994-2004, ahead of the UK average of 5.4%. It has also shown the greatest improvement of any region in the EU. Varying Success’ – Greater-than-expected success of the Eden Project, to failing schemes like South West Films. Feedback : Feedback Professor Peter Gripaios claims that ‘the jam has been spread too thinly on too many projects’. The extreme sports academy is now employing 50-60 people year-round in 2006, compared to 15-20 in 2003. Fifteen Restaurant, trains local young people in catering skills and profits fund further training and development. Fowey holds an annual Du Maurier Festival in May, hosting authors, musicians and broadcasters for 11 days. HOWEVER, South West Film Studies, received 2m from Objective One and were expected to create 200 permanent jobs. In 2004, the studios went bankrupt and the project was halted and never re-started. Slide 6: Regional and National Disparities in Portugal Portugal shows positive feedback at a national level, but negative feedback in terms of its convergence with other member states of the EU Portugal is a Periphery of the ‘core’ countries of the EU. Between joining the EU in 1986, and 1994, Portugal has received 17.5% of EU structural funds. However, since 1986; the unemployment rate as halved and the GPD has doubled. Inward investment has also increased. Therefore, as a result of it’s EU membership, Portugal has benefited on a European scale. However, within Portugal, regional disparities have been created. REGIONAL Periphery Core Portugal – by James Dutt : Portugal – by James Dutt This is a good case study to show that although EU funding can cause convergence on a regional level between the core and the periphery, there still may be divergence on a national level. EU money in this case has helped a country as a whole. The previous example is about helping an area within a country. Slide 8: NATIONAL Core: This area has developed around Oporto and Lisbon, due to the opportunity for business there and its proximity to the sea. Investment in transport Setubal (south of Lisbon) has attracted most foreign investment. Periphery: Since 1993, agriculture has declined due to competition from other EU countries. Vale do Ave textile region will lose 30,000 jobs due to European restructuring. Therefore, on a European scale, disparities don’t exist, but nationally they do. Core Since joining the EU, different areas within Portugal have seen different effects. Italy : Italy This piece of work, half done by Arran shows an example of how national policies may still not be able to stop inequalities persisting. in Italy over the past 40 years millions has been spent but diversity between the north and south is huge. However it does offer some advantages for the investor. Regional Inequalities in Italy : Regional Inequalities in Italy There are a wide range of regional inequalities within Italy. For example first time job-seekers comprise 30% of the unemployed on a national scale, however they comprise 50% in the South, and the south’s rate of unemployment is around four times higher than the rest of the country. Regional inequalities have been increasing rapidly over recent years. For example the average GNP in the south was only the equivalent of 56% of that of the north, this has been an obvious divide since the mid-80s, but has rapidly accelerated since 1992 when a recession set in. Another comparison of the regional inequalities within Italy is that since 1992, the economic growth of the South has only been around 1.5%, whereas the North has grown by about 6%. Secondly, the South of Italy contains about 40% of Italy’s land area, 35% of its people and yet earns only about 24% of the countries GDP. A popular term used to describe this divide between the rich north and poorer south is the ‘Ancona Wall’ and the divide separates Tuscany, Umbria and Northern Italy from the South. The main reasons for the South lacking behind the North are: The weakness of the state’s authority – it is weak and undermined by corruption and organized crime. Administration is poor. Infrastructure is inadequate. Credit is costly and banks are run at a poor standard. The economy is insufficiently geared to exports to offset lower domestic demand. State transfers, the traditional motor of growth are being reduced. The four main points of view of why the inequalities between the North and South are: 1) Southernist View – explains regional contracts in political terms. The argument is that the South was neglected by northern politicians who concentrated expenditure on public works and technical education in the north. 2) Two Nations view – A number of contrasts illustrate the perception of the North as modern and the south as backward, basically efficiency vs inefficiency; urban vs rural; metropolitan vs provincial. 3) Peripherality – the South’s distance from the core markets of the EU shows that the relative inaccessibility of the south is not helped by its poor infrastructural to the north. 4) Economical and Structural – points to rural decline as one of the reasons for the poverty of the south. Harsh Mediterranean climate with long periods of intense heat and little rain made non-irrigated farming difficult. Absentee landlords who rented land to low paid peasants had little incentive to improve the land. Slide 11: This is a good example of someone putting facts and figures in without knowing what they mean. If you use figures than make a point out of them! Cassa per il Mezzogiorno : Cassa per il Mezzogiorno Set up in 1950 to raise living standards to the same as the north Land reform – set up small farms from absentee landlords Growth pole strategy – 60% state investment goes to the south. Large investments in steel and chemical plants Results : Results Belief that south is incapable of self-generated growth Many growth poles failed and known as “cathedrals in the desert” Notable exception – Melfi – Fiat factory set up in 1993. Created 7000 jobs as labour costs 30% less than north. However, after 40 years left with dual industrial structure – northern or foreign financed giants and small artisan style local industry. No linkages as predicted by growth pole strategy. ? Is has inequality persisted. Maybe without any help it would have been even worse. SoUtH WaLeS : SoUtH WaLeS A n E d u c a t i o n a l E x p e r i e n c e Industrial growth, decline and regeneration Case study by Ian Dicks This is a good case study of how scanning sections of a book can be used as a way of not reading and summarising a case study. It is also a good case study of a half done piece of work. It shows nicely how South Wales has declined but has not shown any policies. Brazil Case Study by Royston : Brazil Case Study by Royston In the early years it was the North-East that became the wealthiest region of Brazil with many plantation crops especially sugar, leading to growth, imports and exports. In more recent times the South- East region has been home to urbanisation and industrialisation, with the creation of jobs and wealth. Today the North –East has 30% of the population but only 14% of the wealth. The South-East has 42% of the population and 64% of the nations wealth. South-East became the core of Brazil, the main cities being Sao Paulo and Rio De Janeiro, centred around coffee growing, gold and diamond prospecting and the export of these goods. Growth continued with the mining of iron ore and steel production, the region became the centre of commerce for brazil with improvement in services and jobs attracted many from the surrounding rural areas. The North East Became the Periphery. Overtime the soils have become poor and frequent drought has caused insufficient yields to feed the local population. The crops that do grow are mainly for export, e.g. sugar cane. There is a high birth rate meaning the region is overpopulated, and due to lack of investment there is poor industry and services causing a lack of jobs resulting in high migration to the South East. From 1950-1970 some 20 million people moved from rural to urban areas in Brazil. Slide 20: There was an increasing gap of wealth between the South East and other regions. To combat this in 1952 it was decided to create a new capital city to help shift the wealth. The chosen location was 1200km inland from former capital Rio, it was an uninhabited site used to create Brasilia. The hope was to open up the centre of the country to spread out Brazils economic growth , Brasilia's population reached 1.9 mill in the 1990’s but its economy was based around commerce and administration rather than industry, with many people still preferring to live in Rio and Sao Paulo. 1960 – Five regional Development Agencies set up. One was SUDAM, which would develop Amazonia. However access was needed first = Trans Amazonia Highway, this became a growth corridor where landless farmers were re settled along. However this soon failed as once the forest had been cleared the soil soon washed away, consequently the new farmers ended up leaving to the large urban centres along with everyone else. 1975 – Government tried to develop Polamazonia by investing large sums of money to generate economic activity. Such activities included highways, mining, free ports, agriculture, industry and hydro electricity. Overall creating new jobs and wealth for Brazilian companies creating a trade surplus. However it has resulted in the destruction of large areas of the rainforest and the traditional Amerindian way of life.