Reinventing Bilbao, the Story of the Bilbao Effect

Abstract

The City of Bilbao, Spain, garnered worldwide recognition for its economic regeneration, known as “The Bilbao Effect”. It suffered a total economic collapse in the 1980s after a downturn of its industrial economic base and a devastating flood. This paper examines the methods The City of Bilbao used to forge its path back to international success, and ultimately win The European City of the Year Award in 2018. While Bilbao is known for its world-famous Guggenheim Museum, the critical elements of the regeneration strategy are less well known. They include its system-wide urban planning strategy, its housing programs, its job training programs, the leveraging of its local culture, banking system, long history of technical ingenuity, and the determination of the Basque people. This paper is a companion to the documentary film “Reinventing Bilbao, the Story of the Bilbao Effect” by Manta Wake, LLC. Bilbao collapsed due to a significant reduction of its shipbuilding of industry, a dramatic flood of the city’s historic center, and high levels of pollution. The strategy to recover and reinvent the city included three components: conversion of the economy from an industrial economy to a professional service economy, cleaning the environmental problems, and transforming their former industrial brownfield sites into new walkable mixed-use districts that would host the new economy. One of the most visible projects is the redevelopment of Abandoibarra District, a large abandoned industrial brownfield site adjacent to the city center. The new walkable mixed-use development on this site is a focal point of the regeneration plan. It includes new housing, offices, university facilities, cultural facilities, retail, and parks. One of the last major buildings constructed on the site is The Guggenheim Museum by architect Frank Gehry. According to the city’s Director of Urban Planning, the worldwide success of the museum would not be as great if it were not for the entire urban and economic planning effort the city had established prior to the construction of the museum. The city chose to invest in architectural design to continue its tradition of high-quality culture. The city’s transportation system improvements were designed to connect the Basque Region to the city’s economic center. Improvements included a new subway system and light rail system, a new airport designed by Santiago Calatrava, easier pedestrian street crossing points, and new bike lanes. The accomplishments of the “Bilbao Effect” include a reduction of the city’s unemployment rate to amongst the lowest in Spain. New businesses have opened in the city center including offices, research firms, and major retailers. Tourism has increased over tenfold. National and international conferences have taken place in the city regularly. The city also reduced its deficits to near zero and the Basque Region has re-emerged as a major source of economic growth in Spain.