Malmo turned itself from a polluted, ugly, declining shipbuilding centre into the exact opposite - a clean, green global capital for sustainable living.
This astonishing metamorphosis took place after the bottom fell out of the shipbuilding industry and the Swedish city which depended exclusively on it was faced with urban extinction. Instead Malmo re-invented itself, using all of the seven principles of 'Magnet Cities' as assessed by KPMG's Vanessa Langley and Caroline Haynes in their global study of such city transformations.
A strong city identity, physical renewal, attracting young wealth-creating people, new ideas and links with academic institutions, connecting the city to other cities, fundraising and strong leadership were all evident in Malmo's resurgence.
KPMG rated it as one of the world's nine Magnet Cities alongside Bilbao (Spain), Changwon (Korea), Christchurch, Denver, Incheon (Korea), Oklahoma City, Pittsburgh and Tel Aviv (Israel).
"Malmo has been an uplifting story," says Haynes, KPMG UK's Advisory Practice Director and author of the Magnet Cities study. "They knew the shipbuilding days had gone and they looked at who they wanted to attract there - young people and science-based people.
"They knew they had to be progressive and provide a quality of life so they determined to turn themselves into a clean-technology city with infrastructure to support a sustainable lifestyle," says Simon Hunter, KPMG partner in Auckland. "Malmo took the same kind of thinking as Waitakere City's Eco-City concept and turned it into a driver of innovation and commerce."
The decline
Malmo's shipbuilding industry declined over 20 years. It had prospered under the reign of the Kockums shipyard, enjoying earnings 20 per cent higher than the Swedish norm. But, when the oil crisis of 1973 hit, Kockums went from having the most orders in the world to none in a year.
The government acted, replacing shipbuilding with the Saab car empire - but in 1990, it merged with General Motors and closed the new car assembly factory; workers who had re-trained from shipbuilding to car assembly were laid off again. When the real estate and financial bubble burst in the 1990s, Malmo saw one in five jobs disappear and had the country's highest unemployment rate. The young left the city in droves.
The fightback
Mayo Ilmar Reepalu refused a government handout and decided not to replace shipbuilding. He knew the dying city had to be re-established as a place young people wanted to be.
He added to the budget deficit, cleaning up the city and beautifying it while searching for a new identity for Malmo. After public consultation, they decided Malmo would be turned into an 'urban laboratory' to test new technologies for sustainable living; the city would be turned into a global capital for practical and enjoyable clean, green city life.
Malmo didn't have a university - it hadn't needed one as almost everyone was apprenticed to the shipbuilding industry - so Mayor Reepalu put up free land for the government to build Malmo University. It now has 24,000 undergraduate and graduate students and 35 per cent of the population have degrees - where previously almost no one did.
With young people coming back to the city, Malmo turned its attention to growth, turning the vast 187-hectare Western Harbour from a filthy, empty shipyard precinct into a worldwide showcase of sustainable housing. A bold plan was devised and carried out to power Western Harbour entirely from renewable energy.
Electricity comes from solar power and wind. Heating comes from sea water stored in natural underground aquifers with a heat pump system. The same system is used for cooling in the summer. There is no rubbish collection in Western Harbour - everything is biodegradably disposed via home garbage disposal units or vacuum pipes, waste piped or trucked to a facility for biogas production.
Grey water is recycled for cultivation purposes, including feeding the green roofs and walls now built into the city's building code. Developers caught on to the creativity of the Malmo experiment, agreeing to green and sustainable ratios in buildings and homes - and the city started to attract more young people interested in the city's experimental and pioneering identity.
New neighbourhoods are being built along similar sustainable lines while areas like Augustenborg and Rosengard have been retro-fitted with new sustainable technologies like stormwater systems, green roofs, sustainable laundry rooms, compost machines and solar cell facilities. Sege Park - a new housing project - will be ecologically sustainable and will host Sweden's only solar power plant.
The architecturally, environmentally and socially progressive city stemmed from an entrepreneurial council that leveraged its own assets to be a test bed for innovation and experimentation - providing momentum and direction for a new high growth economy.
The results
That new identity helped with the next step - encouraging knowledge-based businesses, particularly in the areas of 'cleantech' and life sciences. It led to the city offering itself up as a testbed to complement Malmo University's reputation for research, becoming a kind of urban laboratory.
Malmo became a magnet for science and technology-oriented entrepreneurs. Tourism has also been encouraged, with the city claiming valuable territory as a centre for commercial events.
Malmo has pulled off a major turnaround in the last 20 years, with its income increasing 15 per cent over five years and with the average per capita income now 92 per cent of the Swedish average.
Lessons for Auckland
Hunter says the key observation from the Malmo story is that councils can innovate: "Malmo took its weakness and through innovative thinking, commercial nous and smart use of its own physical assets, created an exceptional city. Its actions triggered economic recovery and growth because of the science and technology entrepreneurs it attracted. It is not clear Auckland has a licence to innovate but it is very clear it needs one."
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