Accessibility and Social Inclusion: Infrastructure Challenges in Latin America

Creating inclusive infrastructures, which enhance and facilitate day-to-day life of residents, will allow them to boost their productivity and that of their cities. We must ensure that social groups, especially women, low-income families, the elderly, among others, can participate fully in every aspect of everyday life, while collaborating in the design and implementation of clear and transparent public policies. This was one of the topics discussed during the first day of the Infrastructure for Latin America Development Conference.

During her keynote address, the governor of the Province of Buenos Aires, María Eugenia Vidal, was blunt in stating that “infrastructure is the great social debt of the Province of Buenos Aires. It is there where the province shows worst deterioration, and where we set one of our priorities. Our government has set three priorities: public safety, infrastructure development and social inclusion.”

The governor noted that infrastructure debt exceeded USD 32 billion, equivalent to little over the provincial budget of one year, and the province used to invest only 3% of the total budget. Thus, our first task was to more than double that investment and set a yearly growth goal in public works. “Our goal is to reduce the infrastructure debt of the Province by 25% this term, and we are already delivering, with 1,300 completed projects, and by the time these are completed, we will have 3,200 projects between ongoing and those in the design stage,” she added.

Lastly, María Eugenia Vidal thanked CAF for its contribution in strategic initiatives for the Province, such as the Luján River Basin Comprehensive Management Plan to prevent flooding and the construction of a water treatment plant that will meet the drinking water demand and help improve efficiency of supply systems in La Plata, Ensenada and Berisso; among others.

The Minister of the Interior, Public Works and Housing of Argentina, Rogelio Frigerio, spoke at his keynote lecture about the importance of infrastructure to promote regional integration. In Argentina, 162 binational projects are being developed, with an investment of nearly USD 50 billion, of which 53 are underway and 32 have already been completed. “We have 18 border crossings concentrating 85% of the flow of goods and services, on some of which we are working with CAF’s assistance. These projects not only improve trade with our neighbors, but also enhance tourism, another key sector,” he added.

“All these investment challenges are also present in terms of financing, and that is why we need the assistance of multilateral agencies such as CAF, which in the Ministry of the Interior, Public Works and Housing alone is supporting us in more than 80 projects, for which we are very thankful. Another key player is private investment. Therefore, we are pleased with the success of first tenders for Public Private Partnerships (PPPs) to build 1,500 km of safe roads, 200 km of special roads and 800 km of highways. This means that Argentina will be able to double the investment in the road network without affecting our limited budget and the balance of public accounts,” he added.

PPPs were one of the central themes of the presentation on “Governance and transparency” in the infrastructure sector, by Eduardo Engel, director of the Anti-Corruption Program of the Espacio Público Foundation. “PPPs can solve many of the major problems of provision of public infrastructure, but, as experience of recent decades has shown, they can also create new problems. However, with proper governance, the benefits of PPPs can be realized while avoiding their risks. Governance must emphasize transparency and institutional strengths is a key element of a successful PPP program.”

Engel explained that one of the advantages of PPPs is that they allow us to do more with the same amount of resources. This is because incentives for private entities are better on issues such as quality of construction, which provides for lower maintenance costs, in reducing construction times, and for governments because risks are allocated differently. “However, the main benefit is that it solves one of the main problems of public infrastructure provision, i.e. the low incentives and resources given to existing projects,” he added.

Accessible cities

Robin Chase, co-founder of ZipCar, explained that transportation is the gateway to opportunities for individuals and businesses. Whether going to school, to work, meeting your friends or connecting with suppliers and customers, it all depends on the quality of the transportation network. “Cities that promote and plan only for personal cars are excluding a great number of people and are not pleasant places to work, live and play. The best transport systems prioritize safe walking and cycling, as well as carpooling modes. This means that the young and the elderly, the rich and the poor, men and women, all have an array of options to meet their mobility needs throughout their lives. Accessible and connected cities are the most productive cities,” she added.

The mayor of Medellin, Federico Gutiérrez, emphasized the importance of a good public transport system when connecting territories, providing a service that ensures reasonable commute times and costs to improve quality of life. “Our city’s transport system is known for its environmental sustainability, but above all because it represents a great social innovation: We must achieve physical and fare integration if we want to enhance development of communities,” he said.

Lake Sagaris, researcher and associate professor at CEDEUS, emphasized the accessibility of cities, noting that “as evidenced by CAF data, a strategy to improve these issues in cities is simply to ensure that social groups, especially women, low-income families, elderly, among others, can participate fully in every aspect of everyday life, protecting the environment with cleaner activities, promoting health by using more public transport, collaborating in the creation and implementation of clear and transparent public policies.”

In addition, Juan José Méndez, Secretary of Transportation of Buenos Aires, noted that “a safe and connected city is a city of opportunities. This enables equitable access for all residents to the alternatives offered by the city: the possibility of entering a larger and more diverse labor market; and better educational and healthcare offerings. This is how we conceived transport; as a service that must ensure accessibility to all walks of society.”

More pragmatic regional integration

In the last panel of the day, “Infrastructure for integration: How to streamline the infrastructure agenda for regional integration?,” Dyogo Oliveira, president of the National Bank for Economic and Social Development (BNDES), said that Latin America is challenged to escape the “trap of projects that are merely ideas” and focus on those for which funds can be secured. He added that “financial and legal models should be promoted to facilitate realization of projects; sovereign credits have followed this model for a long time, but PPPs can be a good solution.”

Furthermore, Gustavo Beliz, director of INTAL, explained that the region must adapt to the current context. “Much of the trade between our businesses is determined by the digital revolution, which is intangible. We must connect infrastructure to the demands of Latin Americans: 80% of people prefer digital connectivity over roads, according to a Latinobarómetro survey, and therefore, in order to integrate cities efficiently and intelligently, we must listen to what their residents are demanding.”

Jorge Forteza, specialist in Territories and Business Development Strategies and Governance, emphasized the added value that integration should have “in order to create value chains between our countries, and to offer more services and products in addition to commodities. Latin America must, and can, increase its global market share in many areas, and thus, we need to rethink the concept of integration and see beyond commodity export.”