Commissioner for Regional and Urban Policy, Johannes Hahn explains what smart and sustainable growth means for European cities.

It is becoming increasingly clear that economic growth in the EU will come primarily from Europe’s towns and cities. The reality is therefore that these days neither MemberStates nor the EU can achieve their economic or social policy objectives without engaging with cities. The figures speak for themselves: metropolitan regions host 59% of the EU population and 62% of all jobs – generating 67% of the Union’s gross domestic product (GDP).

Since cities are places where challenges are raised and where solutions can be most effectively delivered, they are in the driving seat to implement many EU or national policies at local level. For example, if the EU is to meet its climate targets, it needs cities to better address resource and energy efficiency, notably in transport, housing and in overall urban design. Working across levels is also essential for cities to solve problems such as poverty concentration, spatial segregation, ageing populations, etc.

Therefore, the EU offers a wide framework of support for cities and urban areas, with a great deal of European Commission work impacting in some way or another on cities – seeking a holistic approach to their growth and development.

My job, as Commissioner for Regional and Urban Policy, is to ensure that all these initiatives are coherent and create synergies, and that we work in partnership with Europe’s cities. This will, I believe, unleash the potential of cities to help deliver EU-wide goals of green and balanced growth. Cities have to be at the heart of our plans to create a Europe that is prosperous, environmentally sustainable, and where no citizen is marginalised.

With the dawn of a new budgetary and development programming period for 2014-2020, EU Regional and Urban Policy continues to devote its resources to boosting the economy through targeted action in all EU regions – and pioneering work in its cities that can help boost competitiveness throughout the Union.

Under the new Regulations approved recently, all regions have to target between 50 and 80% of their European Regional Development fund (ERDF) investments on innovation, information and communication technologies (ICT), small and medium-sized enterprises (SMEs) and the low-carbon economy. Overall, there will be a very significant amount of EU funding devoted in the next period to making cities ‘smarter’, ‘greener’ and ‘more inclusive’. It is essential for cities to ensure that all ERDF-funded projects are aligned with strategic planning policies for their regions.

For cities, smart growth means that urban areas should support a transition towards a knowledge society, building on social, organisational and technical innovation. Cities should develop new educational pathways and a favourable entrepreneurial environment. They should foster a dynamic local & social economy.

In the EU Smart cities and Communities Initiative, smart cities are regarded as places where flows and interactions become smart through making strategic and relevant use of information and communication in a process that is responsive to the social and economic needs of society.

We have to look for projects that do not look at technology in isolation but together with other key issues such as public space, soft mobility, spatial integration, social innovation, and so on.

Green growth means changing a city’s development path towards a model that uses fewer resources to achieve more. Initiatives and projects can include the redevelopment of brownfield sites such as disused dockyards or steelworks, turning them over to business, educational or cultural use – or a combination of these. Cities are supported to develop sustainability strategies or tools to assist the transition to a carbon-free energy system, as well as exploring new green options to reduce their carbon footprint. For example, the ‘Retrofit South East’ project carried out in Petersfield is a good example of the reduction of energy consumption as one of the aims of housing intervention. The Petersfield project improved the energy efficiency of housing aimed to stimulate the emerging retrofit market and has led to the creation of new quality jobs in the region.

In order to advance the inclusive growth of cities, our Policy invests in local responses stimulated by strategies such as neighbourhood management. Tools include education, health and social infrastructure and the development of local services. It is driven by local actors and plays an important role in creating social inclusion. The vital ingredient of an inclusive growth strategy is lively partnerships, which bring in civil society organisations representing people at risk of exclusion, and which embrace the various tiers of government.

Cities must reposition themselves in looking at these various pillars of urban development. They should use the ERDF and other financial resources to provide good public spaces, efficient administrative services as well as physical workspaces with a range of facilities.

Experience tells us that nearly half of our future funding will be spent in urban areas in one way or another. Our philosophy is that effective investments in urban areas should follow an integrated strategy, based on synergies across sectors. We need to bring together the necessary actions in a holistic view of the development of our urban centres.

A strategic approach is a key element of Regional and Urban Policy, and therefore, we are obliging every MemberState to devote at least 5% of total investments under ERDF specifically on integrated sustainable urban development. We will continue to work with URBACT, who provide a platform for exchange of experience and work on the development of local action plans in the various fields of cooperation between European cities. We will also invest €330m in innovative actions in sustainable urban development which will explore new solutions to today and tomorrows urban challenges.

The key to achieving the Europe 2020 goals of smart, sustainable and inclusive growth is indeed in harnessing the potential of our cities.


Johannes Hahn

Commissioner for Regional and Urban Policy

European Commission


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