Social Development and Public Governance > Social Development > Urban Development
Neighborhood Upgrading
In most countries of Latin America and the Caribbean, the formal housing sector has failed to meet the needs of households in all income brackets. Consequently, low-income households are forced to find informal solutions to their housing problems, through doubling-up with other families or by purchasing or occupying land in illegal settlements and building their homes themselves. Informal settlements, generally with significant deficiencies in basic infrastructure and urban services, make up between 20 and 65 percent of the residential areas of the largest Latin American cities.
After ignoring and trying to eradicate informal settlements for years, the governments of the region are adopting a new approach to incorporate these settlements into the formal city and solve deficiencies in situ. In concordance with the UN Millennium Development Goals, the IDB supports this approach through loans and technical assistance for neighborhood-upgrading programs, which complement new home construction and improved local urban development policies. These programs finance integrated investment packages that include basic sanitation, streets and neighborhood social services and have proven to be effective instruments of social policy in reducing poverty.
Last updated: 06/14/07
