Lima Looks to Future

Sources:
Correoperu.pe: Empiezan estudios para el metro de Lima
Elcomercio.com.pe: ¿Es factible un metro subterráneo en Lima? Harán estudios de factibilidad para comprobarlo

The mayor of Lima, Peru, Luis Castañeda, announced this week that the French government will give the city $900,000 USD to finance studies about the feasibility of a subterranean train in the capital city. The studies will take between 3–4 years and will be undertaken in two phases. First, the two foreign companies in charge of the studies (the American firm Systra and French firm Ingerop) will determine what areas of the city are in the most need of subway access based on population movement patterns. The second phase will identify the exact routes the trains will follow, as well as the more technical aspects of the project like cost, financing, environmental impact, etc.

By the time the studies are completed, Mr. Castañeda will no longer be the city’s mayor. He is currently leading early polling for presidential elections that will take place next year. The plan will likely need the support of the central government to help fund the project, which the central government appears currently able to do with increased revenues resulting from robust economic growth. Unfortunately Peru is still a largely undeveloped country so there is much need across the country for potential government development dollars. With most of the country’s poor residing in the central highlands or the Amazon basin, many would claim that the money would be better spent on infrastructure in those regions instead of in the more affluent coastal capital that is already building an extensive bus and electric train system to serve its population.

The second problem facing the project is that it would require the support of the future mayor. The city recently held elections and is still awaiting the final results. One candidate supported the idea of a subway system for the city throughout her campaign, though her challenger (and leader in the count so far) did not. Either candidate will have to cater to a constituency that includes many poor residents concerned more with first getting a job than finding transportation to a job, but an informal poll on a Peruvian newspaper’s website shows 93% of votes in favor of the idea.

Discussion:
1) Peru is one of several countries in Latin America currently experiencing robust growth and in need of extensive development if that growth is to continue. What should these countries be doing with the increased government funds? Considering that few, if any, parts of Latin America are fully developed, does it matter where government development is targeted? Should development be targeted mostly for the areas that need it the most (like the highland and rainforest areas in Peru)?