"A lesson in London's Geography"? Canary Wharf and local responses to global investment.

Abstract

The principal contention of this thesis is that the problems Canary Wharf has faced, thus far, in establishing itself as an international financial centre can be best understood within an analysis of its competitive relationship with the City of London, perceived in a broad economic and political sense. This competitive relationship is considered at two distinct but related levels. First, as one between neighbouring local coalitions where the relationship is characterised by intra-urban competition for London's global financial services. It is shown that the City's political response has been determined by its perception that Canary Wharf represents a political threat because of its potential to undermine the City's status as London's preeminent location for global financial services, and also an economic threat because of its related potential to undermine City land values. The City's competitive response is principally manifest in the radical (pro-development) overhaul of its planning system that took place in the mid to late 1980s. Thus, in the first place, the City's political response undermined Canary Wharf's ability to establish itself as a new node for global financial services. Secondly, it is argued, the relationship between Canary Wharf and the City illustrates a complex interplay between global forces manifested locally at Canary Wharf and economic and social processes local to the City of London. It is shown how such local processes further constrain the global ambitions of Canary Wharf. Thus, the reluctance of financial institutions to locate at Canary Wharf is explained by agglomeration economies, the continuing 'need' for face-to-face contact, the 'need' amongst financial institutions for the City's 'comfort factor', and the dominant perception of Canary Wharf as 'foreign territory', an unacceptable location for financial services. The combined impact of the local political, economic and social processes outlined above have shaped the marketing strategies adopted at Canary Wharf over time, and it is now marketed as London's 'third business district'. However, the 'reshaped Canary Wharf continues to illicit a competitive response from the City. A number of factors have recently combined to herald a renewed period of intense intra-urban competition, illustrating the complex nature of the relationship between Canary Wharf and the City. Through the two sets of analyses, the case study is intended to address wider processes of urban restructuring and urban change, including the changing role of local governance, the use of regime theory in understanding the role of local processes in urban change, and the 'global/local interplay'.