The Paulistanization of Rio

Traveling between Rio and São Paulo, it's evident that in some ways, Rio is becoming more like Brazil's biggest city, in both good ways and bad as it grows and develops. Here are just a few examples. 

-Traffic has spiraled in Rio with a spike in the number of cars on the road. Sitting in traffic in Rio after sitting in traffic in São Paulo, it's hard not to compare the experience: bumper to bumper traffic, barely moving, with motorcycles noisily speeding between lanes. São Paulo traditionally has some of the biggest traffic jams in the country; Rio commuters now deal with longer and longer treks to and from work, and you'll find heavily congested roads even outside of rush hour.

-Car ownership in Rio rose by 62 percent--or 1 million cars--from 2001 to 2011, according to the Observatório das Metrópoles. There were an estimated 2.82 million cars in Rio last year. (São Paulo still has the largest number of cars in the country.) Motorcycle ownership also rose by 338 percent over the same period to 430,733. In one weekend edition of O Globo, one of Rio's largest newspapers, I counted nine sections on cars, including ad sections and a "caderno especial."

-Air quality has gone down as a result of so much traffic. São Paulo, which historically had poor air quality, now reportedly has cleaner air than Rio. A 2011 World Health Organization report indicated Rio had the worst air quality in the entire country.

-Cost of living has increased in Rio, with everything from restaurants to housing to movie tickets. São Paulo has traditionally been the most expensive city in the country and has a higher cost of living than Rio, according to the 2012 Mercer cost of living index. This year, Rio ranked as the 13th most expensive city in the world, right behind São Paulo at 12th in the world. But Rio has been creeping up behind São Paulo; it was two spaces behind in 2011 and 8 spaces behind in 2010.

-Rental and real estate prices also spiked. São Paulo has traditionally had some of the most expensive real estate in the country, but Rio real estate has become very costly. According to Cushman & Wakefield, this year Rio has the most expensive office space rentals in Brazil and all of Latin America. (Its office rentals are now the 8th most expensive in the world.) In October, Rio passed Brasília to have the most expensive real estate prices per square meter in Brazil.

-Malls have mushroomed in Rio. With the largest economy in the country and no beach, the city of São Paulo was known for its malls. Rio, too, has a big mall scene but in recent years, the city's seen new malls popping up in the Zona Norte and Zona Oeste, as well as numerous malls in Barra and Recreio. The city could see a new mall in its train station, Central, and a huge new luxury complex called VillageMall is due to open in Barra next month.

-More finance and multinational companies are opening offices in Rio, even though São Paulo is still Brazil's business hub. Just a few examples of companies opening or planning on opening offices in Rio include Pimco, Honeywell, Fircroft, and Dow Chemical. Cisco plans to open a center for innovation in the city, and GE plans to open its Fifth Global Research Center in Rio. The massive R&D center will be built on Fundão and is the first of its kind in Latin America. Direct Edge even hopes to launch an equities exchange in Rio de Janeiro to compete with São Paulo's Bovespa. Media companies are also planning expansion into Rio prior to the upcoming mega events; one recent example includes SNTV, a TV sports news agency.

-International educational centers are opening in Rio. International exchange company CIEE opened its first Rio de Janeiro center in August. Columbia University will officially inaugurate a Rio de Janeiro study center next year. Harvard University is rumored to be negotiating a Rio de Janeiro center.

-Tech companies are increasingly flocking to Rio, though São Paulo is still a major destination for such companies. Over the past few years, Rio has become one of Brazil's biggest hub for startups. Rio has more tech parks than anywhere in Brazil and hosts 22 incubaators, according to Rio Negócios. Around $1.4 billion in private investment have gone to Rio tech hubs since 2010. Some hope Rio could become Brazil's "Silicon Beach."

-The fine art scene is growing in Rio. While Rio has a number of fantastic art museums, São Paulo has traditionally been the national leader in fine art. But that may be changing. ArtRio, the city's biggest art show, began last year, when sales hit $70 million--three times what the show reached earlier in São Paulo, according to RioReal Blog. This year, the show saw 74,000 visitors in just the first four days. With a growing cultural scene, Rio's gallery scene is also expanding.

Image: Mark Goble

Comments

[Adam]

A lot of this must be hype - realistically, can the city actually support this?
Rio is turning into a very expensive, congested and hard-to-live-in city. All the decent housing is crammed into a tiny sliver along the coast (zs -recreio) and the majority still lives in favelas (800+) or poor quality exurban housing.

Where will all these new workers live?

Will they drive to work?

What will their salaries be in order to justify the high cost of living?

[Toby]

Brazil as a whole is growing at an incredible pace! Sarah and I have recently moved here to Recife and are enjoying it, but watching it grow is amazing. The traffic is ridiculous and watching the valuation of property is amazing as well.

Growth is good and bad.

Nice post.

[Dad]

It appears Mitt Romney must read your blog. In the last debate, he cited all of the great economic opportunities in the Latin America. Does Brazil TV have Big Bird and Cookie Monster? Maybe he can watch Portuguese Sesame Street in the back of his limo while stuck in traffic.

[joe]

very good info... Rio is ridiculously expensive but also it has always been... it's just that lately it's being invaded by twice more people from everywhere...

Joe

[Irineu de Carvalho Filho]

" Rio is ridiculously expensive but also it has always been..."

What!? Rio used to be dirt cheap. I was a graduate student on 300 dollars a month back in the early nineties there.

"Brazil as a whole is growing at an incredible pace!"

Not really. Brazil's economy is growing at the same rate or lower than the average of Latin America. There is no data that shows that Brazil was a fast grower in the last 30 years and little or no evidence suggestive that it will turn around in years to come.

[Edith Mitchell]

I have my itinerary already for my Brazil travel next year. I cannot wait for that graduation gift of my parents for me graduating at the top of my batch. I did not put Rio though on my list because I have heard from friends that the place is really expensive. I will be out of budget.