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Florencia Acevedo, a mother of three, used to brace herself every day for a long, difficult ride before commuting from her home south of Buenos Aires to Constitución, near the city center. It’s a 12-kilometer trip (about 7.5 miles), but because of limited public transportation options, it took her over an hour and a half each way. That’s time she would rather spend caring for her children.

Her quality of life improved significantly when Metrobus, the city’s bus rapid transit (BRT) service, launched a new route that reaches her neighborhood a few years ago. “I would say it takes me about half an hour less to get to and from work now, so I arrive faster to be with my kids,” she says.

Acevedo is among the millions of users of public transportation in the Argentine capital who are benefiting from several initiatives by the city of Buenos Aires to improve urban mobility. The city and its surroundings have almost 14 million inhabitants, or over 30 percent of the country’s population, making it the third most populous metropolitan area in Latin America.

With a shorter commute, Florencia Acevedo can now spend more time with her children. © Martín Pereira Bouvet

IFC became a strategic partner of the city by providing a $50 million loan to finance critical infrastructure such as the Metrobus and bicycle routes. IFC is also offering technical advice on issues such as low-emission transport and energy-efficiency programs, and promotion of sustainable construction including in the most disadvantaged areas.

These initiatives share the same objective: improving citizens’ quality of life and the overall livability of their city. “Latin American cities will only develop if they put citizens at the front and center of their growth strategy,” says Fernando Straface, general secretary of the city of Buenos Aires. “We value IFC’s long-term strategic partnership in these initiatives that aim to create a more inclusive and safer city for all citizens.”

IFC is supporting Buenos Aires on areas ranging from low-emission transportation to sustainable construction. © City of Buenos Aires.

Smart Growth Strategies Across the Region

IFC financing and advisory services throughout Latin America and the Caribbean are supporting a wide range of efforts to meet urban citizens’ needs. Our strategy often includes the promotion of public-private partnerships, which can be a tool for governments to leverage expertise and efficiency of the private sector.

IFC is now partnering with six subnational governments throughout the region to offer more efficient services to citizens, improve transportation infrastructure, and generate investments of more than $1.5 billion by 2020. More than half of this figure would be resources from other investors mobilized by IFC. Switzerland’s State Secretariat for Economic Affairs (SECO) and the Government of Japan are partnering with IFC in several of these initiatives.

Demographics compel Latin American and Caribbean cities to embrace efforts to promote smart urban growth. The region is already the second-most urbanized in the world and has gone from an urbanization rate of 62 percent in 1980 to more than 80 percent in 2017. If this trend continues, 90 percent of the population of the region will live in cities just 20 years from now.

This puts pressure on cities—because although urban areas are important for investment and economic growth, many in Latin America and the Caribbean have not been growing sustainably in recent decades. Better transportation options for urban residents can close infrastructure gaps and move the region toward more sustainable urban growth and inclusion of all of its citizens.

Image: More than 80 percent of Latin Americans currently live in cities such as Buenos Aires. © City of Buenos Aires.

Several projects that IFC is supporting in Bogota are good examples of this strategy at work in Colombia, a focus country for IFC’s Cities Initiative. They include TransMilenio, a bus rapid transit service, and TransMicable, a cable car system that will shorten by 45 minutes the commute from Ciudad Bolivar, a low-income area in Bogotá, to one of the main transport stations.

TransMicable, which is scheduled to become operational in December, benefited from residents’ input and broad community engagement. In one instance, discussions revealed that residents of the area are concerned with security—especially at night—which prompted the installation of security cameras in the cars. As part of the project, the municipality is revitalizing public spaces in Ciudad Bolivar, including parks, gardens, and community centers.

In a low-income area of Bogota, a cable car system will shorten residents’ commute. City of Bogota

New Ideas for a New Era

IFC also offers Latin American and Caribbean governments guidance as they develop urban areas that will serve expanding populations. In Honduras, IFC and the municipality of Tegucigalpa are engaging in a long-term alliance to overcome technical and financial constraints that are obstacles to delivering infrastructure to residents. Efforts are focused on enhancing the city’s creditworthiness and financial management capacity. This is expected to ultimately attract private investment to develop key urban infrastructure projects.

We are also helping cities in the region address challenges posed by climate change. In the Colombian city of Barranquilla, IFC is supporting the construction of six underground storm water drainages through 2019. They will minimize street flooding that currently paralyzes the city for more than 20 days a year, jeopardizing the safety of residents and causing substantial economic losses for the city.

In Buenos Aires’ Barrio 31, a drug distribution center was turned into a modern, green building. © Centro de Desarrollo Emprendedor y Laboral (CeDEL)

Promotion of sustainable construction, even in the most disadvantaged urban areas, has been another target for IFC. For example, Buenos Aires’ Barrio 31 (formerly Villa 31), one of the poorest neighborhoods in Argentina’s capital, lacked formal access to electricity and water services until recently. In an effort to revitalize the neighborhood, city leaders built a modern three-story public office building on the ruins of a drug distribution center. 

At no additional cost, the building met the requirements for IFC’s EDGE certification—an international standard for green construction—which allows Buenos Aires and its taxpayers to save money on energy and water while protecting the environment. SECO helped develop and roll out the EDGE certification and green-building standards in the region. The World Bank, which often partners with IFC in cities initiatives, has also provided financing for the Barrio 31 project.

As part of IFC’s engagement with cities like Buenos Aires, Bogotá, and Tegucigalpa, we are a strategic partner in Urban 20 (U20), a G20 initiative that brings together mayors from cities around the world to discuss key issues related to the future of cities. The initiative will culminate with a summit in late October in Buenos Aires. U20 priorities include closing the infrastructure gap, addressing climate change, creating jobs, and promoting social inclusion.

Join the conversation: #IFCimpact #IFCcities

Published in October 2018