How one Polish town delivers high quality of life and a competitive business climate—learning from Środa Wielkopolska

Image result for środa wielkopolska mapaThe town of Środa Wielkopolska in central Poland has had a remarkable turnaround. With poor infrastructure, a weak economy and high unemployment in the early 1990s, it’s now a place that delivers high quality of life for its residents and a competitive business climate. There’s a free public transport system that links surrounding rural areas to the town; all families have access to low-cost child care; attractive public spaces and bike lanes are a draw; businesses have grown and so has the population—from around 22 000 inhabitants in 2009 to 31 000 in 2016.

So what’s the secret? How has the town managed to delivery high quality of life and attract businesses—a standout among its peers?

The answer lay on a number of fronts. The town’s economic development strategy promotes low taxes, a supportive business environment, effective spatial planning and high quality of life. Investments have been made both in technical infrastructure to support business development and cultural and leisure facilities in order to make the town attractive to residents. In effect, the town’s approach to local economic development is grounded in a focus on the multiple dimensions of well-being. Local taxes have been kept as low as possible in order to attract businesses and residents. Economists call this strategy “beggar thy neighbour” – there is a risk that such an approach leads to diminished public finances and in turn a reduced ability to provide infrastructure and services. But to date it seems to have worked well for Środa Wielkopolska and the town’s municipal budget has increased 3.5 times over the past 14 years. Residents note how public engagement between the local government and residents is a key part of the town’s turnaround. The town has a policy of being open to both businesses and residents and engages citizens in community planning. There are also strong connections between surrounding villages and Środa Wielkopolska. It is also undeniable that Środa Wielkopolska has benefitted from its proximity to the regional capital of Poznan—so proximity to a bigger city also plays a role in its success.

Making the most of smaller places—rural-urban linkages

The town of Środa Wielkopolska has taken an encompassing view of local development—it has looked beyond its own municipality to forge connections with nearby rural communities. This has proved beneficial for all. This approach—linking up smaller places—forms one of the cornerstones of Poland’s new national development strategy, the Strategy for Responsible Development. The new strategy recognises that recent economic growth in Poland, while impressive, has been mainly driven by increased prosperity in larger urban agglomerations, and that many of the more rural areas and smaller towns have not adequately participated or benefited from it. The resulting poverty and social exclusion has created stresses in Polish society that the new strategy seeks to erase. Poland proposes a number of actions on this front, one of which it to better link up small and mid-sized cities and market towns with rural areas to improve the delivery of social services, labour market outcomes and to help propel economic development.

The OECD’s work on rural-urban linkages has pointed out the value of such an approach, finding that better integration between these areas is important for socio-economic performance. The concept of rural-urban linkages has had widespread application in both developed and developing countries and a growing number of policy instruments to encourage such partnerships have been developed. But while the linkages between larger urban areas and surrounding peri-urban and rural communities have been widely explored, the linkages between small cities and towns (those with a population of 50,000 and below) and rural communities has been far less of a focus of research or policy design. As countries like Poland promote policies for more balanced growth—this is going to be a policy area to watch.

For more info see OECD Rural Policy Review of Poland 2018.

Contact: Tamara.Krawchenko@oecd.org

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