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Latin American cities get better for poorer residents

Ihard Don’t run into hipsters in La Condesa or Roma Norte, two of Mexico City’s trendiest districts. The areas are filled with cafes, shops filled with vintage clothing and parks filled with “digital nomads” who have moved there from the US during the pandemic.Inevitably, locals complain about gentrification, rising rents and Janquis speak English. However, these two regions represent a broader trend: Latin American cities are much better off than they used to be.

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Fully 81 percent of Latin Americans live in cities. By some measures, it is the most urbanized region in the world. Beginning in the 1950s, large numbers of rural people migrated to cities in search of better jobs, schools, and health care. Many moved to several large hubs. City planners can’t keep up. Housing is often unaffordable for new immigrants. Instead, many built their own homes on the outskirts of town. Between 2000 and 2010, Rio de Janeiro’s official population grew by only 3.4%, but its slums increased by 27%. One in five residents in the area lives in informal communities (see chart).

Part of the result was that, by the 1990s, Latin American cities were in disrepute. But today many people have changed. Sao Paulo in Brazil, Buenos Aires in Argentina and Santiago in Chile all have lower murder rates than Miami (12.8 homicides per 100,000 people per year).

Surprisingly, most of the improvement has occurred in impoverished, unplanned settlements. Take the example of Iztapalapa, a municipality of about 2 million people east of Mexico City. The area’s mayor, Clara Brugada, claimed the neighborhood was “abandoned” when she took power in late 2018. Out of 2,454 cities, it ranks in the top 10 for violence. There are no street lights. But now many major streets are brightly lit. Since then, the crime rate has dropped. The city’s murder rate has dropped from a high of 19 per 100,000 people in 2019 to 12 in 2021. That’s well below the national average of 28 murders per 100,000 people a year.

Ms Brugada is not the only politician who has been impressed. Over the past two decades, a succession of mayors has incorporated slums into major cities. They improved transport networks, roads and public squares. They built parks. By 2014, Medellin, Colombia’s drug capital for decades, had opened 4 square meters of public space to every resident, including a public library, a science museum and a botanical garden. In 2022, the government of Iztapalapa created dozens of green spaces and turned cul-de-sacs into playgrounds.

Federal law helps. In 2001, Brazil passed a law that meant politicians should work with their residents instead of eradicating slums. But the biggest driver of change is that many of these mayors have more power than mayors elsewhere. The government of Buenos Aires controls education and has its own police force. It can also raise its own taxes, including stamp duty, property tax and income tax. That’s considerably more fiscal power than the mayor of London, but slightly less than the mayor of New York. Medellin’s centrist mayor Sergio Fajardo from 2004 to 2007 allowed residents to choose how to spend 5 percent of the municipal budget in their area. During his tenure, Mr. Fajardo spent as much as 40 percent of the city’s budget on education.

Part of the drive for innovation is that mayors in Latin America are directly elected rather than appointed by the federal government. They usually want to run for national office and are therefore keen to make a good impression. Mexico City Mayor Claudia Sheinbaum is a favorite to become president in 2024. Mauricio Macri, the mayor of Buenos Aires from 2007 to 2015, succeeded him as president. His successor, Horacio Rodríguez Larreta, is the front-runner to become president in Argentina’s general election in October.

Latin American city governments have also found ingenious ways to finance their projects, says Anacláudia Rossbach of the Lincoln Institute, an American think tank. Federal cities such as Mexico, Argentina, and Brazil are often cash-strapped because they rely on central government transfers to fund infrastructure, and they often give more than they receive. Columbia cities use an “improvement tax”: Residents whose property will appreciate in value when roads are built must pay additional taxes to fund them, which also applies to other public infrastructure. Many mayors have also formed public-private partnerships or applied for loans from international agencies.

Nonetheless, there is still much work to be done. Crime rates remain high in many cities. In Mexico City, murders have fallen but extortion has risen, making it harder for people to start businesses. Many mayors fear that as climate change worsens, it will push ever more migrants to unstable suburbs of towns and cities. Children in Latin America do worse in school than children in most other regions. Inflation squeezes the budget.

But like hipsters and slum dwellers, other mayors have taken note of Latin America’s progress.At the end of last year, Buenos Aires hosted the CThe 40 summits brought together the mayors of 97 of the world’s largest cities. Not far from the luxury convention center, chef Lis Miguel, 49, who once lived down a noisy highway in Villa 31, the notorious slum, opened the doors of her new home, which the city helped build last year. The windows are from the World Bank and the Inter-American Development Bank. When she first arrived in the favela ten years ago, she told herself, “Get out of here at the first chance.” Now, she says, pointing to her living room and open kitchen, “I’m here in peace.”

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