Discussion Papers 2007.
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REGIONAL GOVERNANCE IN CENTRAL EUROPEAN
REGION: THE CENTROPE CASE
DANIELA COIMBRA DE SOUZA
Introduction: new modes of governance
Local governments have become increasingly engaged in fostering and encourag-
ing new ways of local development and employment growth and have been in-
volved in economic development activities related to production and investment.
This occurs in a context of “glocalization” (Swyngedouw, 1997: 103) (and
“global-local disorder” that implies a host of institutional changes within the local
and regional state apparatuses (Brenner–Peck–Theodore, 2006) and a “re-scaling”
that differs from the previous state development model – the “National Keynesian
Welfare State” (Jessop, 2002) which emphasized the national scale. In this sense,
local governments strive to respond to an enhanced scope due to the emergence of
important new problems, which cannot be resolved “through top-down state plan-
ning or market-mediated anarchy”, implying a “shift in the institutional centre of
gravity (or institutional attractor) around which policy-makers choose among pos-
sible modes of co-ordination” (Jessop, 2003: 102).
Following Moulaert et al (2002) and Harvey (1989), these changes affecting lo-
cal governments have converged in an entrepreneurialist form of state that devel-
ops a new type of growth coalition, involving local chambers of commerce, local
financiers, industrialists, property developers, etc., resulting, therefore, in a more
intricate form of state, as the power to organize space derives from a whole com-
plex of forces mobilized by diverse agents. Consequently, local governments seek
new technologies of government and a new form of multi-scalar governance is
emerging.
There is a wide array of notions of governance, which can easily be related to
various views of planning or political theories (Moulaert–Sekia, 2003). Govern-
ance is here understood as the “emergence, proliferation and active encouragement
of institutional arrangements of ‘governing’ which give a much greater role in pol-
icy-making, administration, and implementation to the involvement of private eco-
nomic actors on the one hand and to parts of civil society on the other hand in self-
managing what until recently was provided or organised by the national or local
state” (Swyngedouw, 2005: 1992). Additionally, governance also entails explicitly
the multilaterally involved interests and the necessity of mutually satisfactory deci-
sions and projects. It can also be understood as: “the reflexive self-organization of
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DANIELA COIMBRA DE SOUZA
independent actors involved in complex relations of reciprocal interdependence;
this self-organization is based on continuing dialogue and resource-sharing to de-
velop mutually beneficial joint projects and to manage the contradictions and di-
lemmas inevitably involved in such situations” (Jessop, 2003: 103).
In what concerns the governance of governance, i.e. the meta-governance
(Jessop, 2003), states have a major and increasing role. According to Swyngedouw
and Jessop (2006) states “provide the ground rules for governance and the regula-
tory order in and through which governance partners can pursue their aims; ensure
the compatibility or coherence of different governance mechanisms and regimes;
act as the primary organizer of the dialogue among policy communities; deploy a
relative monopoly of organizational intelligence and information with which to
shape cognitive expectations; serve as a ‘court of appeal’ for disputes arising
within and over governance; seek to re-balance power differentials by strengthen-
ing weaker forces or systems in the interests of system integration and/or social
cohesion; try to modify the self-understanding of identities, strategic capacities,
and interests of individual and collective actors in different strategic contexts and
hence alter their implications for preferred strategies and tactics; and also assume
political responsibility in the event of governance failure” (Swyngedouw–Jessop,
2006: 22).
Even pursuing the meta-governance responsibility, local governments, through
local governance systems, seek to promote economic development by a new insti-
tutional setting which incorporates public-private-partnerships and “flexible” in-
stitutions giving much greater role to actors of civil society. It, however, raises the
question of the actors to which role is given and the results of the governance sys-
tem in terms of policies.
Considering these lines, the present work describes the intentions and first re-
sults of a PhD dissertation, which aims at investigating the governance system in
terms of growth alliances in a produced space: the newly emerging so-called Cen-
tral European Region – “Centrope”, in the border region of four European coun-
tries: Austria, Hungary, Czech Republic and Slovakia. In this created region, which
do not coincide with a formal political administrative unit, local governments
launched a project to face economic challenges through a cooperation building that
aimed to gather different actors.
Daniela Coimbra de Souza : Regional Governance in Central European Region : The Centrope Case
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Centrope: re-creating an old trans-national region
An emerging region
Central Europe is an intermediary region between Western and Eastern Europe
with deep historical roots, though later the West became urban and industrialized,
while the East remained rural and agrarian (Anderson, 1980). Within the Habsburg
Empire these centre-periphery relations were found within the political-military
unity of the Austro–Hungarian Empire. Austria ruled over the Western, Hungary
over the Eastern part and their respective nations. After 1918 the region experi-
mented with democratic, authoritarian and fascist regimes and after 1945, the East
was disconnected from the West by the Iron Curtain, a border nearly identical to
the border of the Carolin empire around 800 (Szücs, 1990: 13). After 1989, the fall
of the Iron Curtain, attempts to cooperate with neighbours changed the geopolitical
position of Vienna from the most Eastern part of Western Europe to the historical
position linking Eastern and Western Europe (Musil, 2005) (Figure 1).
Figure 1
The Centrope Region
Source: CENTROPE (2006).
Daniela Coimbra de Souza : Regional Governance in Central European Region : The Centrope Case
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DANIELA COIMBRA DE SOUZA
“Centrope is the lead project which develops a multilateral, binding and lasting
cooperation framework for the collaboration of regions and municipalities, busi-
ness enterprises and societal institutions in the Central European Region”
(www.centrope.info). The launching idea was to “create a prospering European
Region”, where a governance system could be established.
The project is financed 50% by the European Union, in the framework of the
Structural Fund INTERREG III-A, and 50% by the three Austrian Federal prov-
inces of the region: the governments of Lower Austria, Burgenland and Vienna.
The very first aims of Centrope were divulged at its launching event. The pro-
ject was officially inaugurated by a meeting of local governors in September 2003
in the Austrian town of Kittsee. At the occasion, local governments signed the
“Kittsee Declaration”,1 the three main statements of which could be roughly
summarised as: 1) to establish a common region; 2) to create an internationally
attractive location; 3) intensify co-operation, networking existing initiatives, com-
municate the future potential of the region to the public at large and strengthen
social and entrepreneurial commitment to the region.
Additional objectives of the project involve issues such as public relations,
networking and communication; assistance to the coordination of existing cross-
border activities; and mobilisation to engage public, commercial and social bodies
in regional attempts. Further subjects are: research and training; economy and the
labour market; regional development, infrastructures, culture, location marketing
and the promotion of “success in competition between European regions”
(CENTROPE, 2006).
Antecedents of the Centrope Project
Efforts have been made by Austria, and more specifically from Vienna, since the
early 1990’s to establish co-operation with neighbours and “to maintain but also to
extend its grown role as an attractive site for international co-operation and to po-
sition itself as a competence centre of European co-operation” (Vienna–Stad-
tregierung, 2004: 2).
Centrope is not a first action in this direction, some of previous attempts are: (a)
the association of governments of Vienna, Lower Austria and Burgenland in the so
called “Vienna-Region”; (b) the sequence of seminars in the years of 2000–02 with
participants from four countries launched and coordinated by the Europaforum
Wien, a Viennese non-profit organisation, by initiative of Vienna’s government; (c)
the cross-border project DIANE (Direct Investment Agency Net), launched in 2002
1All Political Declarations of Centrope can be downloaded at http://centrope.info/baernew/topics/
Project_Conferences.
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by the three local development agencies of the “Vienna-Region” to build a network
of the local (governmental) development agencies of the four countries of
Centrope.
Nonetheless, before the direct attempts, the Viennese government has made
other movements to benefit from the fall of the socialist regimes in Eastern-Europe
and to associate with its neighbours, which had already belonged to the same state
during the Habsburg Empire at the 19/20th centuries.
The cooperation after the collapse of the Iron Curtain is considered “the return
to a new normality”, as “only the political events of the 20th century that split this
socially, economically and culturally integrated region into a space divided by bor-
ders” (Centrope 2006: 5).
Although based on the partnership idea, Centrope Project represents, however, a
shift in the traditional organisation of social forces in Austria. During the interwar
years, Austria went through an economic crisis and the Vienna social democrat
local government – known as “Red Vienna” – opted for a local welfare state to
diminish the effects of the crisis. After World War II, the whole of Austria was
embedded in a Fordist economic model supported by an alliance between produc-
tive capital, the middle classes and organised labour. A restrictive wage policy –
achieved by agreements with labour unions – and an expansive fiscal base pro-
longed the lifespan of Austrian Fordism until the 1980’s (Becker–Novy, 1999).
Austria turned towards European unification to combat the crisis, by adopting a
restrictive fiscal policy and privatisation. After Austria had joined the EU, the la-
bour unions and new social groups became less capable to organise themselves and
to react to the changes than the enterprise associations. New agreements with un-
ions ended in more restrictive wage policies, which raised unemployment rates and
reduced incomes. The new challenge was to improve international competitiveness;
Vienna strived to “become an international finance and service centre”, turning
itself into the “Gateway to the East” (Novy et al. 2001: 132). Local institutional
changes aiming at the attraction of external investments included restructuring
government towards an entrepreneurial model and new institutions that aim at
giving local government better capacity to respond quickly and flexibly to inves-
tors’ requests (Novy–Becker, 1998: 18). Business agencies were created to imple-
ment new economic policy and large urban projects based on public–private part-
nerships. The new planning forms were more open to the business sector and ap-
pealed to a public of “qualified” persons. Planning started serving an “ideological
shift towards entrepreneurialism, managerialism and business friendly policies”
(Novy et al. 2001: 139). With these attempts Vienna has abandoned the corporatist
system to enter an internationalised liberal European mode of governance.
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The Organisation of Centrope Project
Centrope’s regional development initiative reflects the Viennese ideological shift
towards entrepreneurialism and its engagement in building joint proposals with its
eastern neighbours. Vienna has a key role in the project, which is conducted mainly
by Austrian partners. Four organisational bodies are involved in Centrope:
Political Conferences are the meetings of the heads of the sixteen local govern-
ments of Centrope. It represents the higher decision level, which guides the opera-
tive implementation of Centrope. So far there were three conferences, all in Aus-
tria: the inauguration Conference in Kittsee (Burgenland), September 2003; the
second in April 2005 in St. Pölten (Lower Austria); and the third in Vienna, in
March 2006. The secretary board of Centrope (see below) translate the discussions
of the Conferences into documents, the “Declarations”, which contain the political
guidelines to all Centrope’s actions, their common view and desired common fu-
ture.
Advisory Board is a discussion forum composed by two representatives of each
local government of Centrope. The representatives are “normally from lower po-
litical level or higher administrative level”. That could be, for example, political
secretaries of the local executive government, local legislators (connected to the
head of the executive) or heads of local offices (as in Vienna, whose main repre-
sentative is the head of Planning office). The Board is only a consulting body, not a
decision making level.
Steering Committee: is formed by the three Austrian Federal provinces that co-
fund the Centrope project, i.e. the governments of Lower Austria, Burgenland and
Vienna. The Committee is the actual executive decision making body, responsible
for selecting the projects presented by the Consortium that will receive financial
support, i.e. will have the authorisation to be implemented.
Consortium: is the executive body, responsible for practical everyday imple-
mentation actions, i.e. “building the multilateral co-operation” by assisting the
coordination of existing crossborders activities and the regional working groups,
writing projects to submit to the Committee, selecting ideas, etc. The main tasks
are executed by governmental agencies and collaborators. It is formed by the fol-
lowing Austrian entities:
− Vienna Business Agency (WWFF), the city’s governmental development
agency.
− Ecoplus: the governmental business agency of the province of Lower Austria.
− WIBAG – Business Service Burgenland: the governmental province’s
agency.
− Regional Consulting ZT Ltd: an Austrian private consulting company.
− Europaforum Wien: a non-governmental and non-profit organisation, which
has the Viennese government as main and quasi exclusive client. It holds the
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secretary function: elaborating communication material (as Political Declara-
tions, website and planning documents), launching and coordinating meetings
to strengthen regional cooperation and engagement of neighbours.
Planning, Participation and Discourse in Centrope
In this fashion, the planning and decision making of Centrope is conducted by the
Political Conferences on the general strategy and by the Consortium and Steering
Committee on the tactics and practical issues. Hence, two points are remarkable:
the absence of non-governmental actors; and the concentration on the Austrian
governments.
The second point is already a source of conflict, as non-Austrian governments
complain of the lack of a common space for financial decisions. The intended so-
lution is to foster complementary INTERREG projects under a Centrope umbrella,
with non-Austrian governments as projects leaders and co-financers and, as a result
able to take financial decisions. The first additional project is the Slovakian was to
be launched at the end of 2006. The Czech one is ongoing.
Regarding the absence of private and civil society actors in Centrope, notably is
the lack of formally institutionalized channels to incorporate the interests of non-
public actors. The participation could solely be achieved in the working groups, the
pilot projects or the Centrope Platform. The working groups are formed by “ex-
perts” and organised to discuss development themes. They can produce diagnoses
and “jointly deliberate on appropriate strategies and development steps”
(www.centrope.info). However, the discussed themes are selected by the Consor-
tium and the Secretariat is responsible for publicizing the results of groups’ discus-
sions in Centrope informative channels. Moreover the “experts” are almost totally
from local and regional governments or regional agencies.
Although any local actor can suggest projects, the pilot projects are launched by
the Consortium, as it has the scope of writing projects and submitting them to the
financial decision level: the Committee. They are implemented by various actors,
but analogously to the working groups, it involves mainly public administrators.
The Platform counts in its majority on private and civil society participants, on the
other hand it is an information forum with no decision making or planning scope.
With this concentration on state actors, the discourse is therefore constructed by
collaborators of governmental of the above described organisational levels.
The principal planning document is the brochure “We grow together – Together
we grow: Centrope Vision 2015” which consolidates the results of the third
Political Conference, held in Vienna in March 2006. Furthermore, it brings a syn-
thesis of the working groups and pilot projects results. The common “Vision” is
focused in the selected regional themes such as economy, education and culture
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DANIELA COIMBRA DE SOUZA
and others and describes the intended regional plan, the desired common future. Its
object is to reach the population and promote the project to a mass public.
Official documents related to Centrope are differentiated according to two dif-
ferent target groups, but have the common characteristic of advertising folders: one
aims at the population in general in order to “communicate the future potential of
the region to the public at large” (Kittsee Declaration 2003; www.centrope.info).
These documents stress cultural and employment/labour issues, thereby, con-
structing a regional identity. The second type of documents is directed towards
investors and gives information concerning locational advantages of the region. It
includes information on tax cuts for corporations and all kinds of governmental
subsidies or services offered.
As showed, the main actors in Centrope come from government or outsourced
public bodies. These are highly educated and cosmopolitan bureaucrats who be-
come key opinion maker and “organic intellectuals” (Gramsci, 1971) of regional
integration. They form an increasingly internationalized elite network and elaborate
their own “discourse of competence” (Chaui, 2000), which incorporates and
institutionalizes new (mainly liberal) ideas and embeds it in everyday practices and
common sense through documents and speeches that contain selected narratives.
Governance in Centrope
The conception of Centrope is an attempt to create at the same time a region and a
mode of governance. It is a spatial as well as political innovation. This final section
will display some preliminary analysis of this new arrangement by focusing on the
new institutions and its balance of power and the participation of regional actors.
Centrope is a region with no constitutional status, but a long history. It articu-
lates local and state governments, two federal units, in a supra-regional territory.
Czech Republic, Hungary and Slovakia are unitary states, which implemented de-
centralisation recently during adhesion to EU. In its totality, Centrope is a trans-
borders and trans-national region as well as a top-down initiative of public policy.
The region has not only a historical root, but is increasingly becoming a meaning-
ful territory for living, working and investing. They condense relations of produc-
tion and reproduction, regulation and accumulation and institutionalize socioeco-
nomic relations, a prerequisite for formation of new territory. It shows that the
regional level is becoming more suited to the challenges of socio-spatial restruc-
turing than the local.
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Institutional changes to a new region?
The role of the involved governments in Centrope is marked by leading executive
powers that foster relatively homogeneous strategies and discourses.
Involved in governance system are the head of local governments (in the Politi-
cal Conferences of Centrope) and development agencies, which belong to or con-
centrate only representatives of the executive. The result is a concentration of au-
thority in the executive power. The system formally opens space for local and re-
gional legislators; however, room is given solely in a discussion forum (Advisory
Board). Besides, the degree of their participation is minimal.
In addition, the leading role of executive power is reinforced the “flexible”
agencies responsible for implementing regional development projects. The forma-
tion of governance institutions in the case resulted in creation of more governmen-
tal instances (development agencies) or enhancement of scope of existing ones,
instead of resulting in a minimal state. The mainly public funding of initiatives,
moreover, is also present in the case.
The chosen economic strategies for development emphasise the discourse of
promoting the region by regional marketing, efficiency and competitiveness. Focus
is on attracting foreign investments by advertising the region and on employment
generation by labour market strategies that attract new companies (e.g. fostering
professional qualification and advertising the qualities of their labour force). The
attraction of new investments focuses in the automotive industry and modern ser-
vice-firms. Supporting enterprises is also a main issue.
Implementing these economic development strategies and providing support
services to enterprises became a responsibility of the governmental agencies. How-
ever the embedded discourses of competence and of New Public Management re-
quired a new organisational model, in order to ensure competitiveness. This guide-
line asserted by top strategic level (normally the head of executive) increases the
confusion of function of these agencies between public and private organisational
models, principles and images. Consequently, the collaborators of agencies interi-
orize the above mentioned discourses and tend to see themselves as working in
efficient private services pools that implement the best strategies for development.
Therefore, they reinforce the entrepreneurs discourse by knowledging technologies
as meetings, planning and advertising documents, conversations with other gov-
ernmental spheres and with entrepreneurs (Sum, 2005). Their everyday practices
are changed in order to fit into the “modern and efficient” discourses of compe-
tence and of New Public Management.
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DANIELA COIMBRA DE SOUZA
Growth Alliances and Participation
Concerning the growth alliances in the governance system of Centrope notably is
the lack of incorporation of workers in the governance institutions and planning
procedures. In Centrope the former Austrian corporatist tradition based on a tripar-
tite alliance between state, capital and labour is gradually disappearing.
On the other hand, strong in Centrope is the main intention of building cross-
borders co-operation systems to strengthen entrepreneurial commitment to the re-
gion. However, a long-lasting articulation of public and private actors has not yet
been achieved, although it has contributed to the organization of capital in space:
i.e. in Centrope occurred a stronger association and dialogue between the institu-
tions representatives of enterprises (as industrial and business organisations). This
reveal a improved capacity of enterprises to organise themselves regionally for
lobbying and influencing planning, though using different channels than those in-
stitutionalized by the intended regional governance system.
The structure of governance system permits a type of participation of entrepre-
neurs connected to short term interests. This is mainly due leading role of executive
above affirmed and the absorption by governments of the mainstream discourse of
governance, which preaches that the participation and incorporation of private ac-
tors must be actively encouraged. The concentration of power and actions on ex-
ecutive results in obstacles to accountability and social control and enhances the
effectiveness of dominant private actors’ lobby, which can concentrate their de-
mands in one destiny. The governance discourse enthusiastically assimilated gen-
erally leads governments to celebrate any participation of entrepreneurs in planning
and dialogue. As a consequence their demands tend to be promptly accepted.
Moreover, the structure benefits large enterprises by the privileged incorpora-
tion of business associations, generally administrated by large enterprises, even
when majority of their members are small and medium firms. The lack of formal
participation channels beyond those large enterprises as small firms, communities
and population boosts narrow and exclusive mode governance.
Hence, room is given to private actors to participate in occasions connected to
their short term interests but a solid and long lasting cooperation is not yet clearly
achieved. Austrians invest heavily in its neighbouring countries (Musil, 2005), but
these investors are not formally represented or participating in Centrope. Raffeisen,
an Austrian bank, promotes its own website (www.centrope.at) and activities on
Centrope, parallel to the governmental attempts. The Austrian Industrial Chambers
sponsor an own “Centrope Platform” that gathers together industrials of Centrope
region to discuss their intentions and needs, but this attempt is not connected to the
official governance system.
In this sense, although the analysed experience of association of local govern-
ments have built a new region and created conditions of furthering commodifica-
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tion, by reinforcing the discourse of competitiveness and embedding the belief that
an environment favourable to capital is the only requirement to employment gen-
eration, the local governance systems did not achieve to connect big capital with
local space. Instead, fragile and temporarily alliances were formed. The formation
of accountable institutions for a continuing dialogue and for resource sharing be-
tween broad ranges of relevant actors is not yet a reality in the Centrope region.
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though the author still responsible for all contents of the paper.