By: Staff Writer
November 10, 2023
The Inter-American Development Bank in a recent report said that migration is important for urbanisation in the Latin America and Caribbean (LAC) region.
The report, “Rethinking Urban Migration: Policy Options for Cities in Latin America and the Caribbean,” said that the LAC has narrowed its urbanization gap with developed countries, sometimes even outpacing in many respects.
The rapid demographic shifts in Latin America and the Caribbean over the past 70 years have mainly trended toward urbanization, with more than 80 percent of the population now living in metropolitan areas.
The report also said: “The rising tide of urbanization can serve as a catalyst in the region for economic growth and innovation, enhancing productivity through agglomeration economies, access to larger markets, and the urban wage premium. Nevertheless, if poorly managed, urbanization can give rise to numerous challenges, from overcrowding and inadequate access to services to economic inequality and the rise of informal settlements.
“A carefully calibrated approach to urban planning, governance, and industrialization policies is essential to transform these challenges into sustainable growth opportunities. The physical form of cities—their density, sprawl, and internal structure— powerfully influences infrastructure costs, commuting times, and access to resources. While high urban densities can yield economic benefits, for example, unchecked growth can lead to congestion, environmental issues, and steep housing prices, among other challenges. Balancing these factors requires evidence-informed policymaking that encourages sustainable and inclusive development.”
The report added: “Natural population increase, driven by decreased mortality rates, is the primary source of urban growth in many developing countries… although migration plays a secondary role, its contribution to urbanization is also significant.”
“By better integrating migrants, cities can tap into a dynamic labour force with a wealth of skills and perspectives that can drive innovation and productivity, leading to increased community competitiveness and prosperity,” said Eric Parrado, IDB’s chief economist and general manager of the Research Department.
The report added: “Migration can be driven by voluntary choices or by forced circumstances. In Latin America and the Caribbean, such “push factors” as conflict, violence, natural disasters, and environmental shocks contribute to internal displacement, resulting in the presence of many internally displaced persons, who often exhibit particular demographic characteristics—for example, higher representation of women, indigenous people, and individuals with less education.”
Migration presents a wealth of opportunities for receiving cities. These are not always fully realized, however, and the role of policy is pivotal in unlocking the potential of migration and mitigating its challenges. This report has argued that the two key policy goals in achieving this are promoting migrants’ contribution to local productivity growth and alleviating housing constraints. The pursuit of these goals should be guided by a set of principles that include considering short-term versus long-term scenarios, tailoring policies to specific contexts, engaging the private sector, strengthening capacities in local institutions, and prioritizing policies that benefit both migrants and residents.