Deindustrialization, tertiarization and suburbanization in Central and Eastern Europe. Lessons from Bucharest City, Romania

1. Introduction. Targets

After 1989, once communism had fallen, the European states East of the former Iron Curtain faced major economic and social transformations caused by the transition from the centralized economic system to that based on free competition. Political and economic openness has translated to a greater or lesser extent, from state to state, through an opening to globalizing flows and an of ten-sudden shift from autarchy to integration [1]. The disappearance of political and ideological constraints has radically changed the paradigm of urban development from one based on the political and ideological factor to one subordinated to economic and social constraints [2] in which cultural influences caused by globalizing flows play an increasingly important role [3,4,5]. Cities, especially large ones, were the first to be marked by this evolution trend. Industrial units, mostly energy-consuming and uncompetitive, ceased or reduced their activity, their place being taken over by units from the tertiary sector, insufficiently developed during the communist period. The urban organization has seen profound changes, the industrial peripheries being replaced by peripheries with tertiary and especially commercial functions, developed most often in the vicinity of major roads and railways, thus favoring the processes of suburbanization and peri-urbanization [6,7]. Large cities have developed by incorporating peri-urban spaces, polarized spaces have become integrated spaces, as the urban surface was in a continuous expansion [8].

In this global and regional context, this paper puts forth a prospective analysis of the consequences of the insertion of these phenomena in Romanian cities, casting a special look at its capital, Bucharest, a case study for an area less addressed in the international geographic literature.

The article aims to deepen the current understanding of the ways in which the transition from a centralized economy to one based on free competition has led to changes in large urban centers by reconfiguring the development of peripheral urban spaces and the connection with suburban settlements.

The research focused on tracking the relationship between globalization, deindustrialization and tertiarization, as well as the latter’s impact on urban and suburban space planning. In this context, the common characteristics in particular are highlighted for cities in Central and Eastern Europe, as well as Romania, influenced by the policies of centralized development in the last five decades of the last century.

This paper is based on the experience of an extensive participatory research process carried out over a period of ten years (between 2012 and 2022) in Bucharest, the Romanian capital. Bibliographic sources, data and statistical information, historical maps, as well as the results of field observations and surveys were used. The results were compared with statistics and publications of other authors who addressed this topic.

2. Literature Review

Changes in the organization of the territory arising from the dynamics of urban spaces have been the subject of systematic research since the first half of the 20th century. Studies performed by [9,10,11] remain a cornerstone for the expansion of American cities, as well as those of V. Mihăilescu [12,13] and N-Al. Rădulescu [14] regarding the urban-rural relationship in Romania during the interwar period.

The political and ideological clash of the 1950s, coupled with post-war reconstruction efforts, made the research in this field somewhat come to a halt, then resuming in the 60s-70s. Among the authors who contributed at that time to the improvement of the theoretical and methodological framework regarding the connection between cities and areas of influence are [15,16,17,18,19,20,21,22,23]. Romanian geography rose up during that time through the studies of Cucu [24], one of the first monographic syntheses on the cities of Romania, and Iordan [25] who issues studies on the peri-urban area of the Capital. The 1980s marked a transition towards quantitative approaches, by introducing mathematical models of analysis [26,27,28] etc.

The second political and ideological clash of the 20th century due to the failure of the communist ideology was reflected in a considerable expansion of the range of approaches in the field of urban and social geography. Studies have multiplied quantitatively and diversified in terms of thematic area. Urbanization and, in particular, the dynamics of the urban-rural interfrange, were analyzed both in terms of exurbanization [29,30,31] and peri-urbanization [32], urban morphology [33,34], cultural segregation of space [35,36,37], physiognomy [38,39], the degree of integration [40] or the improvement of the theoretical and methodological framework [41,42,43]. Studies regarding Central and Eastern Europe thus departed from the ideological approaches and related more to the influx of global concerns. The Romanian urban system thus began to be analyzed in terms of the dynamics of relations between settlements [44,45,46]; the degree of connectivity [47]; of industrial dynamics and unemployment [48,49,50,51,52,53], of urban image and segregation [54,55,56,57] or of the quality of urban life [58]. Given the context, the present study wishes to contribute to improving the knowledge of current processes affecting Romanian urban areas, as part of a globalized continent, with a focus on the consequences of industrialization and urbanization of the socialist era and on the relationship between deindustrialization, deurbanization, suburbanization and tertiarization.

3. Methodology & Data Set

The methodological approach is based on the analysis of the historical and political context of industrialization and urbanization (on the one hand), deindustrialization, tertiarization and suburbanization (on the other hand) in Romania and its capital, Bucharest, both based on bibliographic sources and on the analysis and processing of statistical data.

Urbanization in Romania was analyzed in a comparative manner, in the broader context of urbanization within the former socialist states, based on documents and bibliographic sources, emphasizing both general characteristics and regional differences imposed by the economic and socio-political particularities of each country. Certain aspects were highlighted, such as the features of the Romanian urban system, the urban functional typology, as well as the role of the political factor in industrialization and urbanization, the demographic flows that accompanied these processes and their consequences.

Statistical data sources took into account the dynamics of the number of active people employed in industry at the 1992, 2002 and 2011 censuses; the number of people employed in services, urban industrial entrepreneurship, as well as the dynamics of the number of deindustrialized cities, by degrees of deindustrialization. At the same time, a corresponding graphic and cartographic representation of the analyzed phenomena was taken into account, at regional, national and local level.

4. Results & Discussions

4.1. Industrialization and Urbanization in Central and Eastern Europe 1

The collapse of the communist political system highlighted the consequences of centralized planning according to the Soviet model, which in 1945 had already been implemented for over two decades in the USSR, being "exported" to states that came into its sphere of influence after World War II. This development model was based on an economic growth caused by the hypertrophied development of the industry, especially heavy industry, metallurgical and machine building industry, the promotion of the working class and defense-oriented investments, in an autarchic political and social framework in relation to the global constraints at the moment. All this when since the 1960s, the industry in Western Europe and the USA had already begun to enter a restructuring process, in parallel with the large industrial investments east of the former Iron Curtain, where the center of gravity of development was transferred to high-tech branches.

The industrialization of Central and Eastern Europe, out of phase in relation to its western part, generated profound social and spatial mutations, which imprinted differentiated particularities on this part of the Continent, the consequences of which are still felt today. The policy of industrialization generated a rapid urbanization after 1945 either by building new cities near existing industrial centers or on an empty site, as a result of new industrial investments, or the expansion of existing ones as a result of migratory flows from the rural area to new industrial units. In most cases, development policies have directed new industrial investments to small towns, with predominantly agricultural or commercial functions (former fairs), or even to rural settlements, which has led to their explosive population growth based on migratory flows, followed by lending an urban status to these settlements. Thus, there appeared workers' replicas of museum-cities, old cultural, historical or religious centers, seen at that time as "aristocratic", in order to change their image in the minds of the inhabitants [60]. Thus, Krakow, Poland's historical and religious center of tradition, was "doubled" by Nowa Huta, who deemed itself its "proletarian face" counterpart. New suburbs appeared, some even gaining a city status: Novi Beograd (1948), Nowe Tychy (1950), Novi Zagreb (1953), Halle-Neustadt (1967) [61] or even the New Bucharest district, integrated in Bucharest in the 1950s, virtual cities within a city, working-class neighborhoods of traditional urban centers. For example, Militari district, which became part of the Romanian capital in 1950 2, numbered in 1983 over 125,000 inhabitants and about 40,000 apartments, comparable to the big cities of Romania. Their characteristic was lent by a uniform and monotonous urban landscape [62], consisting of large block-type collective buildings, inspired by the model of Soviet cities, oriented towards creating new social relationships, in which individual personality and any trace of opposition to the political system could be easily annihilated [63]. Part of another category are the cities developed on the basis of the political-administrative function, their assigning of an administrative status preceding the setup of industrial objectives. It is the case of cities such as Târgovişte or Călăraşi, to name just two in Romania. They are urban centers that registered a strong development in the 6th and 7th decades of last century, as a result of their becoming county capitals in 1968. This fact was one of the decisive arguments in the setup of large steel companies in these cities.

Currently, the common characteristic of all these urban centers is given by an intense degradation of the urban architectural heritage, the uniformity of the peripheries and suburbs, which require high maintenance costs, the under sizing of green spaces and urban transport infrastructure, and until the 90s, by the insufficiency of service and leisure characteristics. Thus, in terms of infrastructure, the degree of technical and urban features and the urban way of life in general, many of these cities, especially those of a small and medium category, are far from meeting the minimum European standards, to which the Romanian legislation was aligned 3. Wherever it manifested itself, however, the Soviet-type spatial model produced poorly developed territorial structures functionally dependent on central urban nuclei, but at the same time served as a framework for a real modernization of states lacking an industrial tradition and a well-developed, urban infrastructure.

4.2. Deindustrialization and tertiarization. The suburbanization of large cities in Romania

Deindustrialization, as the reverse of industrialization, implies the reduction of industrial capacities, followed by the reconversion of the laid-off labor force [64]. In large cities, this is done with mainly towards the services sector or generates divergent migratory flows [65], often materialized by a decrease in urban population.

Romania was no exception to these developments that have been a main trait, since the 1980s, of all the states located east of the former Iron Curtain. The disappearance of inter-industrial ties, a consequence of the collapse of the centralized economic system associated with failed privatizations, corruption and incompetence at all levels of decision-making has led to the disappearance or reduction in the activity of a large number of industrial units. Thus, if at the end of 1989, the final year for the centralized economy, 58% of Romania's national income was generated by industry and only 27% by services, almost three decades later, the 2018 data showed a reversal in the share of the two sectors in terms of GDP: 62.6% for the service sector and only 33.2% for industry. In Bucharest alone, out of 47 large industrial units 4, only 12 still ran in 2008, and at a much-reduced capacity [66]. In most cases the former productive units were demolished and the lands capitalized on the real estate market (Figure 1).

A. The profile of disused industrial units: 1. energetic, 2. metallurgy, 3. mechanical engineering, 4. electrical and electronics, 5. optics, 6. Chemistry, 7. lumber industry, 8. fabric industry, 9. leather and footwear, 10. food industry; B. Types of reconversion of former industrial spaces: 11. demolished and replaced with commercial areas, 12. demolished and replaced with business parks, 13. demolished and replaced with residential areas, 14. converted into storage spaces. C. The price of land (2019) and its evolution (2018-2019). D. Other signs: 15. Former industrial areas (platforms), 16. industrial heritage buildings, 17. urban boundary, 18. street plot.

Thus, new residential districts, business centers, malls and supermarkets cropped up on the site of former industrial areas (Figure 2). Several former halls and industrial buildings were sold and later used for other purposes (storage, commercial services, car repairs, etc.) or abandoned waiting to be demolished when the price of land becomes attractive enough.

New reconfigurations took place concerning urban spaces, the industrial units located in the urban area were demolished or relocated towards the periphery, and peripheral ones were replaced with residential districts, commercial and storage areas. For most large cities in Romania the consequence was an increase in urban areas. The evolutions ranged significantly, varying between stagnation (Braşov) and increases of over 100% (Râmnicu Vâlcea, 143%) (Table 1), which led to a considerable decrease in urban population density 5. The city of Buzău registered an increase of 64.7% in urban area due to a slight demographic decrease (-0.5%). Significant increases of urban areas were also registered in Galaţi (41.92%), Sibiu (28.38%), followed by Cluj-Napoca (13.43%), Iaşi (11.44%) and Timişoara (10 , 62%). The urban area of the capital saw the largest increase (with an area of 8,040 ha, namely 33.24%), which exceeded the total area of some regional metropolises such as Constanța, Iaşi, Timişoara, Craiova, Galați or Ploieşti). This increase was due to the suburbanization processes, especially at the northern, western and eastern peripheries along the major road ways to Craiova-Timişoara, Ploieşti-Braşov and Constanţa, respectively (Table 1).

On the other hand, deindustrialization has led to layoffs and centrifugal migrations, either regarding a return to the countryside (motivated by land laws enacted in 1991 and 1996), or people leaving to work abroad. These departures, associated with the sharp decline in natural growth, due to the elimination of pronatalist legislative constraints during the socialist period, have led to a decline in population in most urban centers of the country, but predominantly in small and average-sized cities with fewer opportunities for professional retraining. Compared to the general trend, large cities have had an atypical demographic evolution, registering most of the substantial demographic increases. Thus, while the total population of Romania decreased by 1,893,213 inhabitants and the urban population by 1,346,440 inhabitants 6, the largest cities in Romania 7 registered an increase of 340,881 inhabitants and 19,195 ha in urban area, resulting in an obvious tendency to concentrate the population within large cities. The increase was achieved mainly through suburbanization [67], followed by the integration of newly developed areas in the urban area. Surplus land in the suburbs obtained as a result of deindustrialization and a drop in prices compared to those in central areas, have created the premises for profitable real estate investments and services in the peripheral areas of large urban centers. Thus, new spatial polarizations were created at the urban level, generated by the new demographic flows, which put pressure on the transport and urban services infrastructure, which has developed at a slower pace, as it was managed by municipal authorities 8.

Therefore, the dynamics of peripheral urban spaces result from the complementarity of the potential of the two types of local administrative structures (LAUs) which converge here: those benefitting from an advanced degree of urbanization, namely large cities, nuclei of regional and departmental (county) convergence on the one hand, and the communes included in their peri-urban area, on the other hand. The former, characterized by the highest population densities in the urban area and by small administrative territories, have the largest local budgets; neighboring communes, on the other hand, having limited financial resources, have surplus area. The high price of land in the urban area fuels the exurbation phenomenon by locating investments related to the city in its suburban and peri-urban areas, while administrative boundaries becoming purely formal. The city expands through suburbanization, sometimes beyond its administrative boundaries, the rural area thus changing status from polarized space to integrated space.

4.3. Case-study : Deindustrialization and tertiarization through commercial investments. Changes in urban space organization.

The first malls built in Romania were raised on the site of the unfinished buildings of former food complexes, whose construction had begun in the 1980s in areas of population flows convergence, subsequently contributing to the development of their neighborhoods. In a second stage, the policy of industrialization had in view to overlap agro-food and public food units in the big industrial areas for workers to have swift access to them and, thus, shorten dinner-break time [68]. Since the construction of these units was abandoned in the early 1990s, the foreign capital came in, to make them functional for mall-style shopping centers (Bucharest Mall, 1999; Plaza Romania, 2004; City Mall, 2005; Liberty Center, 2008).

Bucharest Mall, the first of its kind in Romania, was located in the former industrial area of Vitan district, and swiftly grew into a demographic convergence core. A second mall (Plaza Romania), opened by the same investor, is situated in the Western part of the city (DrumulTaberei and Militari districts) also on the precincts of buildings left unfinished before 1990 (Figure 3).

The placement of other commercial investments focused on either empty spaces on the outskirts of the city (Carrefour and Metro Militari, Cora Pantelimon), using the rail-and-road infrastructure existing at the outskirts of Bucharest, or the sites of former industrial units later demolished (e.g. Cora Lujerului, built on the site of a dairy factory, could use Cotroceni railway station). Similarly, AFI Cotroceni Mall (the biggest in Romania), situated on the precincts of some former production shops of the Bucharest Electric Machines Plant, had the advantage of a railway infrastructure, while the Megamall (in Pantelimon district) is located on the grounds of the former Electroaparataj Plant.

Commercial and Business Parks, i.e. Sema Park, located on the precincts of the former Semănătoarea Plant in Bucharest; Atrium Center, in Cluj-Napoca (occupies the former production units of Someşul knitware factory); Electroputere Park, Craiova (functions in the shops of the homonymous plant); Plaza Center, Timişoara (stands on the precincts of the former slaughter-house); Korona Shopping & Entertainment Center, located in the former Fartec Plant, and Coresi Shopping Resort, which occupies the former Tractorul industrial platform (both in Braşov), or Bistriţa Retail Park (on the precincts of the former UCTA Plant). These are only a few examples of the reconversion of some former industrial areas into commercial areas.

In many situations, big commercial investments were preferentially located in the administrative territories of certain communes situated in and around big cities, where real-estate prices were lower (the case of such supermarkets as Auchan Timişoara-South, Piteşti-Bradu, Piteşti-Găvana, Sibiu-Şelimbăr; Carrefour Brăila-Chiscani, Floreşti-Cluj, Piteşti-Bradu, Ploieşti-Blejoi, Real Oradea-Episcopiei, Selgros Bucureşti-Pantelimon, Târgu Mureş-Ernei, Dedeman Constanţa-Agigea, Roman-Cordun, Brăila-Baldovineşti (catering to both Galaţi and Brăila cities), Hornbach Baloteşti, Leroy-Merlin Bragadiru, Praktiker Voluntari (near Bucharest), etc. Advantageous locations have led, in time, to the development of commercial parks outside Bucharest: Bǎneasa on the DN1 highway to Ploieşti; Militari on A1 motorway to Piteşti and Dragonul-Roşu on the highway to Voluntari-Urziceni. A similar commercial park is scheduled to develop outside Sibiu (European Retail Park in Şelimbăr residential area, on the highway to Bucharest), Ploieşti (Ploieşti Shopping City on the highway to Braşov), Constanţa (on the highway to Mangalia), Braşov (on the highway between Ploieşti and Bucharest), Galaţi (on the highway to Brăila), Piteşti (on the A1 motorway to Bucharest) etc.

Another location strategy is to modernize the large commercial units built before 1989 in the center of each county-seat (the so-called universal stores) and turn them into malls (Winmarkt Shopping Center in Galaţi, Tomis Mall in Constanţa, Mureş Mall in Târgu Mureş, Moldova Shopping Center in Iaşi, River Plaza in Râmnicu Vâlcea, Maramureş Shopping Center in Baia Mare, Aktiv Plaza in Zalău, etc.). A typical example of such a strategy are the Unirea stores in Bucharest, which were extended and updated into what is now Unirea Shopping Center, with a Carrefour supermarket developing in its proximity. New commercial investments, making best use of the local polarization nuclei in the center of some 2nd-tier towns, have been made in Alba Iulia (Alba Mall), Piatra Neamţ (Forum Center), Deva (Deva Mall, Ulpia Shopping Center), Satu Mare (Satu Mare Shopping Plaza), etc.

Student campuses are considered potential markets for commercial complexes. In Bucharest, Carrefour Orhideea, placed in the close vicinity of the student campuses Grozăveşti and Regie, is a typical example of such a strategy. Iulius Mall in Cluj-Napoca, located in Gheorgheni district, near the campus of the University of Economic Sciences, or Iulius Mall in Iaşi, located near the campus of the Polytechnic University, follow the same location logic, in other cases entertainment is complementary to shopping. Bucharest stands out by number and volume of new commercial investments. According to estimates [69], the city market, which concentrates about one-third of Romania’s commercial leasable area (2.9 mill. sq.m), is already oversaturated. At the same time, Bucharest is the only administrative unit in this country boasting an above-EU living standard average [70], which confirms the close relationship between poverty grade and the spread of commercial investments.

At the same time, the big international retailers chose the Romanian market, opting for locations on the outskirts of the city, or around it, along the big, intensely circulated highways. Thus, large commercial areas would appear, first in the west of Bucharest (Militari Commercial Park) on the motorway to Piteşti city and, at a later date, in the north (Băneasa Commercial Park), on the motorway to Ploieşti city, and on the highway to Urziceni town and Moldova region (Red Dragon stores). Westwards, a commercial area on the outskirts of the city started being developed ever since 1996, when a second supermarket Metro was opened in Romania, followed by Praktiker, Carrefour, KIKA and Hornbach retail networks; supermarkets Auchan and Militari Shopping City (2009). At the North-Eastern periphery of Bucharest stands “Dragonul Roşu” (Red Dragon) which is part of the China Town Project (10 supermarkets on 147,570 sqm commercial area) in the north-west: Colosseum Retail Park (2011) on the Bucharest-Târgovişte highway; in the south-west: Ghencea Shopping Centre (2013); in the south-east: Vulcan Value Centre (2014) (Figure 4).

Inside Bucharest, new malls opened in dismantled industrial areas [71], and became centers of demographic convergence: City Mall was the first investment (2005) in the south of the city, next came Liberty Centre (2008), AFI Cotroceni (2009), Sun Plaza (2010), Promenada Mall (2013) and Megamall (2015). In 2016, they commissioned Park Lake Plaza on the site of a former sports and leisure activity base in Titan Park; Veranda Shopping Centre on the precincts of a former plastics factory, both in the north-east of the city. Thus, the density of modern commercial locations in Bucharest exceeded 490 sqm/inhabitant, which was high above the national average (103.6 sqm/1,000 inhabitants [72].

And yet, new investments are on the way (i.e., Victoria City Lifestyle Retail Centre in Bucureştii-Noi District, in the north-west of Bucharest), while other investments have been abandoned since 1990. It is the case of Dâmboviţa Centre, lying on the banks of the Dâmboviţa River, on the site of a former turf; its construction started in early 1986, initially intended to host the National History Museum of the Socialist Republic of Romania. Abandoned after 1989, the building, in an advanced stage of construction, was put forward for various purposes, first as the Romanian Broadcasting Centre (Radio House) (1992-2008), then sold to an Israeli company to develop a commercial and business center. After being sectioned and the central structure demolished, it was again abandoned (2009), because of the economic crisis [73].

5. Conclusions

Romania and its capital, Bucharest, represent a case-lesson for a comprehensive approach of three complex processes and phenomena showing a solid cause-effect relationship: deindustrialization, tertiarization and suburbanization. When these are happening on a very dynamic (not necessary in a positive way) economic, legislative and demographic backgrounds, the effects are more complicated, even tangled, and the results consist in many and varying new shapes and trends of urban development. În the Central and Eastern Europe, the big moment of change was in 1989. Since then and we can say that until now, the consequences of the oversized, politically coordinated industrialization, but which was not correlated with the potential of the cities' areas of influence, were materialized and they generated somewhat severe imbalances between the urban nuclei and their peri-urban areas. On the other hand, the transition from a central-based economy to an economy relying on free competition generated imbalances in the provision of services between the central urban nuclei and the large residential districts located on the periphery and hastily built as a reflection of industrialization. Also, the collapse of ideological barriers after 1989 put the cities east of the former Iron Curtain back on a natural development trajectory, in relation to the potential and constraints of economic factors relying on free competition.

Three major issues had the main impact on the Romanian towns: the post-1990 industrial restructuring, the Romania’ accession to the EU (2007) and the financial crisis begun in 2007. The transition from the pre-1989 industrial town type to the early 21th century one, with well-represented services, was complex and long-lasting for Romania on the one hand, and with social implications and high costs on the other. The post-1989 economic and urban crisis caused the functional destructuring of towns and rose up the future urban functional model based on the future services town. This was reflected in many cases through the process of deindustrialization, as residential districts or service areas, especially commercial ones, were developed on the site of former industrial units, with a view to absorb the services deficit in peripheral urban areas.

Romania and its capital, Bucharest, are typical cases for such developments. While the total population of the country and the urban population decreased considerably, the population and the urban area of the big cities increased. This growth was achieved mainly through the development of peripheral urban areas and suburban spaces and the replacement of former industrial units with residential and commercial areas. Thus, the functional urban areas were reconfigured, as well as the directions and intensities of the flows from the urban spaces and between them and the suburban areas. The issue is if the case-lesson teach us – the academics and the actors in urban planning – how to avoid the errors in the future and how to resolve or to fix the current imbalances appeared and developed within the urban dynamic in Romania, especially in large towns, and in the Bucharest City in the most visible way. For the future, the research should be focused on different categories of towns approached as study-cases, in this way being sustained scientifically the future urban planning actions.