Metropolitan Research Institute

Metropolitan Research Institute, Budapest

Projects

Győr: How to compete with capital cities (2018-2019)

Client: European Investment Bank – City, transformed

Duration: June 2018 – February 2019

Located between three European capital cities, Győr has to work hard to attract investment and jobs. The Hungarian city has set itself up to attract innovative companies, creating new urban values such as education-based innovation, a high-quality urban environment and a lively cultural sphere. Here’s how a “secondary city” builds on its industrial past even as it breaks away from its dependence on it.

European Investment Bank (EIB) contracted MRI to elaborate a study on the development pathway of Győr in the last decades, and the role EIB played in it. The study pointed out that Győr is located in between three major cities (Vienna, Bratislava, and Budapest), consequently it had limited potential to attract a mix of large companies and investors. Nonetheless, it had the potential to deploy smart specialisation – and it succeeded in doing so. Győr has been known for its highly qualified work force: before the regime change and economic restructuring, one of the largest state-owned companies (RÁBA machinery) was located here. After the transition, the decreased relevance of RÁBA was compensated by the newly settled Audi Hungaria plant, which has come to employ as much work force as RÁBA did in its heyday. In addition, this considerable manufacturing capacity attracted numerous smaller companies to join the value chain.

The operation of Audi Hungaria is one of the economic engines of the second-tier city. However, it also runs the risk of mono-functionality and high dependence on car industry trends. In order to diversify the local economic structure, a new cooperation is currently being established between the local university (Széchenyi István University), the municipality, and local economic actors. This already resulted in new developments, like the Higher Education and Industrial Cooperation Centre (FIEK in Hungarian).

Győr’s recent development has been strongly supported by European funds (similarly to all Hungarian cities), in which national co-financing was secured by EIB loans. The majority of these funds was absorbed by the private sector, although large scale public developments were also implemented, like the two-stage renovation of the inner city, and the social rehabilitation of Győr-Újváros. In addition, EIB provided loans to commercial banks for various purposes, among others for the renovation of privately owned residential buildings in ESCO schemes (the RaabSol project).

The study is available on EIB’s website in English, German, French, and Hungarian; and was also promoted on the EIB’s blog and social media.

Conversation paper on the energy transition in Central and Eastern Europe (2018-2019)

Client: University of Cambridge Institute for Sustainability Leadership

Duration: October 2018-March 2019

The Prince of Wales’s Corporate Leaders Group (convened by the University of Cambridge Institute for Sustainability Leadership) contracted MRI as the leading party of a consortium to produce a conversation paper on the energy transition in Central and Eastern Europe (CEE). This relatively short, business oriented document sought to highlight the main aspects of energy transition and called attention to the business opportunities it offers. The paper covered three interrelated topics: the transition in energy generation, the energy efficient interventions in the building stock and finally the transition trends in urban mobility. MRI cooperated with Energiaklub, Mobilissimus ltd as companies, and Ada Ámon from E3G as a private consultant to cover all aspects.

The paper emphasized both the similarities among the Central and Eastern European countries (11 new member states of the EU according to the interpretation of the study except for Malta and Cyprus) rooted in the socialist past, the relatively lower level of economic productivity and such factors as high homeownership rates, lower level of energy awareness, and high price sensitivity. It also showcased the growing differences, with a few front runner countries in building renovations and mobility solutions (e.g. Czech Republic), some with well advanced digital solutions (e.g. Estonia), and others suffering from particular difficulties, such as high level of pollution and the related coal mining problems (e.g. Poland).

The study demonstrated that the existing high potential of the region regarding renewables is far more than the currently exploited capacities. This gap is the result of political considerations (being reluctant to upset the status quo) and the high public investment needs.  Furthermore, there is great potential in the energy efficiency renovation of the building stock, especially that the mass construction of industrialised buildings allows the development of standardised renovation solutions. Finally, while CEE countries are more used to environmental friendly mobility modes (public transport accounts for a considerable share of all journeys even today), the lower purchasing power can be a barrier to effective energy transition in the mobility sector, as it slows down the uptake rate of electric vehicles.

In spite of these difficulties, the CEE region has a high growth potential regarding the energy efficient investments. However the spread of a reliable and stable regulatory environment will be crucial in all CEE countries in order to allow businesses to operate and make use of the high market potential.

The full report is available at the The Prince of Wales’s Corporate Leaders Group website.

HomeLab: Integrated Housing and Labour Services in the Social Rental Enterprise Model (2016-2019)

Project duration: 2016 october – 2019 march

Client: Programme for Employment and Social Innovation (EaSI) of the European Commission. 

MRI is the coordinator of HomeLab.

HomeLab aims to implement the Social Rental Entreprise (SRE) model in five pilot projects in four Central and Eastern European (CEE) countries ((CZ, HU, PL, SK). The pilots allow the adaptation of the model to the local circumstances in countries with varying social benefit and service provision systems, taking into account the differences in the institutional environment, housing systems and labour market conditions. Based on the experience the refinement of the SRE model will be developed for each pilot that will contribute to scaling up the results, to the possible adaptation of the model both on national and on EU level in order to ensure institutional and financial sustainability beyond the grant period. Furthermore, based on the synthesis of the national models EU level recommendations will be developed with regard to how the EU could support/promote the wider application of the SRE model in other Member States.

Evaluation of Urban Innovative Action (UIA) proposals in the topic of Housing (2018)

Client: UIA Secretariat

Duration: May 2018

Éva Gerőházi, senior researcher of MRI, carried out strategic evaluation of 26 UIA proposals in May 2018 in the theme of housing. The proposals came from different countries of Europe and aimed at implementing innovative housing projects to be elaborated by local municipalities and their local partners. The main strategic evaluation criteria to award the projects was Innovation, which is not easy to achieve taking into account that housing is a cost intensive sphere where any innovation may have a high risk in implementation. That may have been the reason which is why the projects have more innovation in combining the already tested pilot elements rather than creating a brand new mechanism or solution. The evaluation made it also clear that writing a proposal requires a clear vision of what should be achieved and a well-defined way of how to achieve it as without these precise ideas the proposal becomes a hard-to-follow set of activities which the evaluators cannot judge properly.

Development of social support system in the housing and utilities sectors in Kazakhstan (2016-2018)

Project duration: 21 November 2016 – 31 December 2018

Client: Government of Kazakhstan and EBRD TC Account Regarding The Programme of Technical Cooperation

The Government of Republic of Kazakhstan has been committed to a broad economic reform program. Part of this reform is improving the tariff policy by introducing cost recovery tariffs in the public utility sector. The aim of the project is to design social protection mechanisms in order to protect the population from excessive burden of coming tariff increases in utility sector. The project includes the identification of main deficiencies in the existing system of Social Support System (SSS) for low income population, preparing recommendations on legal, institutional and methodological changes of the SSS, preparing recommendation for selection of appropriate level of support on a country-wide level or by regions, assessing the need for integration of information systems of various state authorities, developing policies and procedures for implementation of a pilot project and assisting the administration of the pilot city in their implementation and the quality and quantity assessment of the results of the pilot city implementation.