In terms of the impact caused by the Coronavirus, where does Luxembourg stand in comparison with other countries? Infection rate per capita is lower than in Belgium but higher than in France or Germany. The number of infections has risen to 3,292, the death toll has arrived at 69 as of 13 April 2020, which is high given the total population of just above 600,000. Policy responses to the COVID-19 outbreak, which were introduced in the Grand Duchy before mid-March, are in line with the practice of other countries. As elsewhere, Luxembourg’s government announced a lock-down of public life, with schools and higher-education institutions (such as the UL) effectively closed down, retail and commercial activities limited to the essentials (such as grocery or pharmacies for example), and also international travel reduced to a significant extent. People and institutions of the country’s health and safety sectors work hard in order to mitigate the outcomes of the outbreak.
The capital city, which is used to be pretty busy on workdays, has switched to a Sunday morning feeling of calmness and silence. Much of the economic life has come to halt, and neighbouring countries such as France or Germany have introduced border controls precluding cross the border without proper reason (mainly commuting to essential work). As mentioned in a previous entry, the national airline has suspended all passenger travel until early May, while cargo planes are still frequent users of the airport. As elsewhere, it is difficult to estimate how long such measures will last, what sort of exit-strategy would be taken, and when. An early attempt of the OECD to quantify the influence of the shutdown on the Grand Duchy’s GDP has estimated the short-term losses to account for roughly 20 per cent, with which Luxembourg would still be affected rather modestly, compared to other member states.
However, it is likely that highly connected, effectively globalised places such as Luxembourg (capital city, country) will experience a massive impact on their economy in the longer term. The shutdown has also demonstrated the particular, two-fold vulnerability of the small state against shocks like a global pandemic. Firstly, a particular combination of far-reaching connectivity on the one hand, mobilities of all kinds that are essential for its open economy, but that also bring the virus to its territory. Secondly, the rising density of land uses particularly in the booming capital which contribute to exposing higher numbers of people to possible infections. This combination makes such places prone to risk and thus specifically vulnerable (see Parts I and II of this Blog entry).
As a consequence, the question is whether there are any particular adjustments to the spatial pattern of city and country possible that would contribute to minimising risk and vulnerability: Are there alternative geographies that would help to stabilise the country’s society and economy, not to forget its ecosystems, which would thus make it more robust and also more independent from risk posed by viruses and pandemics? As to the first of the two factors causing risk—global connectivity—it seems extremely difficult to get any closer to proper strategies and measures, given that the country’s economy and state’s budget almost entirely depend on the inflow of capital from outside. Of course, it can be questioned to what extent this is an ultimate necessity (“Sachzwang”), or whether things can be operated at more modest levels. Speaking honestly, it is difficult to imagine that the economic dependence on places and sources of wealth abroad, and the continuous inflow of foreign capital, could be reduced in the foreseeable future. All the global services and financial market places are situated in a figurative golden cage, from which it is hard to escape. It is a pity that the imperative of growth and the related determination of the country’s development path have hardly been made subject to a serious, open and constructive debate so far (… more than a footnote here that the government once hired Jeremy Rifkin as an advisor and spiritus rector for change, but didn’t include the question of growth in this debate at all). The economic slowdown experienced during the COVID-19 pandemic may however highlight the sensitivities of the national economy and show that things can actually become rather difficult; developing strategies to adapt to such changes seems more justified than ever.
In concrete terms, more space for manoeuvre is perhaps available with regard to the internal organisation of territory under the conditions of relational urbanisation. What are the specific strategies that may help overcome the second-order problems created by excessive accumulation, most notably spatial inequality across the country, and the over-heated development in and around Luxembourg City? The big question to address here is whether relationality can be achieved, or maintained, at a smaller scale. Even in the light of the primacy of the political economy of the country, it is important to ask whether a certain re-scaling of relationality is possible that allows a rebalancing of the exuberant economy and the private rent-and-profit-making machine against social life of the many, in order to develop a new sense of the commons.
Alternative geographies would seek to develop a new spatial equilibrium in various terms: First and foremost, it seems urgent to plan for a re-balancing of jobs and economic growth compared to housing as a basic social need; it is widely acknowledged that the housing problem in the country is pressing and wicked but hard to accept. Affordability of housing taken seriously would, for example, challenge the dedication of many communes to create even more office real estate (or luxury apartments). Second, a re-balancing of the power of the capital city as against the rest of the country should be considered as well; not a new idea, as it was key to the government’s spatial programmes from the early 2000s. A robust approach to decentralised concentration is needed that takes the pressure away from the capital city, to the benefit of the Southern and Northern regions. However, the rationale of the market still works in the opposite direction, which triggered some critical commentaries recently, when it was announced that after post offices also bank branches will be closed in several rural communities.
Associated with rebalancing the potentials of capital city and country, one must also be critical of the property-led politics of density that are pursued almost everywhere in the Grand Duchy. The pandemic is only one aspect of the many externalities and vulnerabilities of excessive density in the urban environment, which now deserves a more critical treatment. A resilient Luxembourg would have to be less crowded, even if this would mean a slightly more dispersed development pattern (and an associated ceiling to be placed on recently rocketing real-estate profits). Third, a re-balancing would be required with regard to the role of Luxembourg in the context of the Greater Region. Likewise at the global scale, the Grand Duchy is small but highly interconnected at the regional level, serving as a magnet that attracts an increasing range of commuter flows from its neighbour countries. Spatial mismatch is most obvious here, and it needs a strategy comprising multiple means of implementation, on the housing market, as concerns digitalisation and tele-working, and in terms of common development planning. The time is right for giving the Greater Region more than talks and annual summits, or non-binding strategic schemes as real food for thought and development.
The idea of re-balancing the spatial development and economy of the country touches upon the fundamentals of spatial planning (‘Raumordnung’ or ‘Landesplanung’) – so there is a certain temptation to craft models and plans of a re-balanced small state that develops in harmony rather than polarisation and fragmentation. However, such concepts seem equally attractive in theory, as they have hardly worked out in practice in recent times. One reason for this deficiency is that previous debates had underestimated (if not totally ignored) the power of the political economy, the inherent growth machine and its hunger for more which is deeply entrenched in the country’s development path. Another reason is that the binding power of the state is limited, being constrained by private property and municipal autonomy simultaneously.
A fresh approach to planning is urgently needed in this country, which seems to be both under-strategised and over-regulated in terms of planning and development practice. Alternative geographies would not only have to develop a new sense of realism as to what extent such guidelines and strategies are deemed a) practically possible to implement, and b) effective in steering development. One would also need to sketch some cornerstones of alternative economic pathways for the small state and its spatial development. Ideas that are already under discussion and thus offer some strategic entry points include the diversification of the country’s economic portfolio; a true greening of the financial industry; or the introduction of the circular economy as a principle – not a trendy sector – for future development more generally.
Once asked for the possible questions and issues to be covered by any ad-hoc research on the geographical and urban implications of the COVID-19 disease, these issues could mark our priority. It remains to be seen to what extent these ideas could be brought into a consistent set of strategies that are ready to be confronted with practice. However, among all the difficulties, deprivation and loss which the Corona pandemic has brought about, it is notable that the lockdown allows us to raise questions that might have been difficult to ask when everything was running seemingly as normal. Besides dealing with the pandemic, this ‘normal’ is actually what the crisis is casting a spotlight on.
Markus Hesse
