Analysis: A picture of bold urban renaissance in the regions, led by art

Gateshead could have been forgiven for a touch of Geordie scepticism eight years ago when somebody suggested that a 65ft statue of an angel might deliver the town from the days of post-industrial decline.

The unemployment rate was in double figures and the town was sinking its energies into the Metro Centre, a vast expanse of glass-covered shops, perched on the ash dump of an old power station, which was drawing half a million people a week in the 1990s.

The angel's detractors included the local Liberal Democrats, who waged a vociferous Stop the Statue campaign in 1995, and the Gateshead Post, which said the sculpture resembled the work of the Nazi architect Albert Speer. But the town's civic leaders overruled the lot of them and the commercial history of a once scruffy, depressed town was rewritten.

Precisely why Antony Gormley's Angel of the North became a symbol of bravura and new-found self-belief for the macho North-east has never been entirely explained. But by 1998, when a colossal jersey bearing the name of the Newcastle United striker Alan Shearer was draped over her 160ft wings as the team set off for the FA Cup final, public art was springing up from Sunderland to Northumberland, bringing lottery grants and corporate sponsorship with it and making culture the North-east's new tool of urban regeneration.

Today, the doors will open on arguably Gateshead's biggest cultural development yet: a £46m contemporary art gallery, near the Tyne Bridge, beside the Gateshead Music Centre, a £70m concert hall and music school, designed by Norman Foster, which will open next year. Both will be linked to the Newcastle side of the river by the "blinking" Gateshead Millennium Bridge, which has won the building of the year award given by the Royal Fine Art Commission Trust.

Architecturally, Baltic is arguably the most eye-catching of the lot, taking its form from the brick shell of a grain silo, designed in the 1930s, built in the 1950s, redundant by the 1980s and not so much refurbished as eviscerated in the 21st century.

Comparisons with Tate Modern are almost irresistible: Baltic was hewn from an industrial relic, has a Scandinavian (Sune Nordgren) as its first director and is built on the "poor" side of the river. But metropolitan comparisons are unwelcome in Gateshead. Baltic represents something unique in this country, according to Mr Nordgren. It is an "art factory", displaying something new every four weeks, rather than a permanent collection, and he will refuse to ship in any exhibitions that have shown in London. Instead, Mr Nordgren demands that Londoners and visitors to Britain board a train, ferry or plane from Europe and come to Gateshead instead.

That's some pretension for a place which, as the 35th most deprived area of Britain, was so recently a symbol of northern urban squalor. But Mr Nordgren thinks he can afford it as he surveys what is now known as the Gateshead Quays, the area on the south of the Tyne where Baltic and the Music Centre are being settled.

Collectively, the two venues have already raked in £500m of private-sector money. Demand for retail and catering outlets on Gateshead Quays is so fierce that property agents are picking and choosing their clients. Last week the music centre attracted what is believed to be the largest one-off arts-based sponsorship outside London, a £6m investment.

A £10m endowment fund for the music centre, which will house the Northern Sinfonia, has already exceeded its target, pulling in £11.25m as the private sector chases a part of the "new" Gateshead.

Gateshead is reaping the rewards of an eight-year commitment to the arts that began amid the success of the Angel, according to Paul Collard, chairman of Northern Arts and a leading light in the Newcastle Gateshead Initiative, which is co-ordinating the area's 2008 Capital of Culture bid. "The Angel prompted people in the region to talk about what art is for and why we should have it. It forced us into a choice," he said. "Did we want to carry on as a small, depressed metro-politan borough, or make ourselves visible on the world stage with the kind of profile and investment that cultural projects like this can achieve?"

Other provincial cities – most of them in the North, well away from the draw of the London arts scene – have been reaching the same conclusions as Gateshead about the arts' ability to stimulate investment and self-confidence.

The early models included Birmingham, where the Symphony Orchestra, under Sir Simon Rattle's inspiration, showed that regional cities could make bold cultural statements by having a superb concert hall built, and Glasgow, which proved how a hard, industrial image could be ditched in favour of metropolitan chic by becoming 1990 European City of Culture.

At Salford,the docks were a stinking wasteland, earmarked as a car park, before a lottery handout of £70m funded the Lowry, with its theatres and galleries, at Salford Quays. The Lowry's presence helped to bring in the £28.5m Imperial War Museum North.

Meanwhile, the race to be 2008 Capital of Culture is the catalyst for regeneration in Liverpool, and at Walsalla £15m New Art gallery has smashedvisitor targets.

In Gateshead, Baltic's eclectic opening presentations may provoke some scepticism today. It will be intriguing to witness Geordies' reaction to a Japanese performance artist charging around with French sticks tied to his arms and a white bloomer loaf on his head, for instance. But a region now accustomed to dazzling cultural delights is sure to marvel at the conversion of an old brick hulk into a vast, lofty space that now includes six main floors and three mezzanines, housing five art spaces the size of aircraft hangars, a 300,000-seat performance space, a 60-seat cinema and a media lab.

It's all a very far cry from the Metro Centre.

Image building

* Gateshead Antony Gormley's Angel of the North gave everyone in Gateshead an opinion about art back in 1996. Its phenomenal success generated the political impetus and money for three world-class cultural landmarks on the south bank of the Tyne: Chris Wilkinson's award-winning "blinking" bridge, the £70m Music Centre and, from today, the £46m Baltic.

* Glasgow A dour city provided one of the models for reinvention through culture. It showed that regional cities could make bold cultural statements when it became the 1990 European City of Culture. Countless arts venues have opened.

* Liverpool Its bid to be 2008 European City of Culture has boosted plans to build a fourth "Grace" by the three Edwardian edifices on the Mersey, near the Liverpool Tate. The Walker art gallery has been revamped and an arts centre opens soon.

* Salford Only Gateshead matches Salford for culture-driven renaissance. Its docks were a stinking wasteland before Liverpool's revitalised Albert Dock provided a blueprint for a retail and cultural development. The £96m Lowry art and theatre complex opened in 2000. Without the Lowry, the £28.5m Imperial War Museum North would not have opened last week on the opposite bank of the Manchester Ship Canal.

* Manchester An IRA bomb in 1996 and this month's Commonwealth Games have driven regeneration. The Royal Exchange Theatre, blown apart by the bomb, was rebuilt brick for brick. The city's art gallery has been refurbished and a £30m museum of city life opened.

* Walsall The extraordinary £15m New Art gallery opened two years ago. Visitor projections were a conservative 140,000 a year, but a rolling programme of superb exhibitions brings people back again and again.