How Gentrification Continues to Change Mexico City—and What Comes Next – Condé Nast Traveler

Report on Gentrification and its Impact on Sustainable Development in Mexico City

Executive Summary

A post-pandemic influx of foreign remote workers, or “digital nomads,” into Mexico City has accelerated gentrification, creating significant challenges to the achievement of several United Nations Sustainable Development Goals (SDGs). The rising cost of living, displacement of local populations, and erosion of cultural heritage are straining the city’s social and economic fabric. This report analyzes these developments through the lens of SDG 10 (Reduced Inequalities), SDG 11 (Sustainable Cities and Communities), and SDG 16 (Peace, Justice and Strong Institutions), highlighting the growing disparity between foreign-currency earners and local residents.

Challenges to SDG 11: Sustainable Cities and Communities

The core tenets of SDG 11, which advocate for inclusive, safe, resilient, and sustainable urban environments, are under threat. The primary issues include:

• Loss of Affordable Housing: The proliferation of short-term rental agreements, notably a partnership between the city government and Airbnb, has dramatically inflated housing prices, displacing long-term residents.
• Erosion of Cultural Heritage: The character of neighborhoods is changing, with reports of cultural dilution. This includes:
  1. The closure of traditional establishments, such as pulquerias and businesses operating for over 50 years.
  2. Alterations to local cuisine, such as making salsas less spicy to cater to foreign palates, a phenomenon described as the “gentrification of salsas.”
• Rise in Social Tension: Public frustration has manifested in protests and anti-foreigner messaging, indicating a breakdown in social cohesion and community inclusivity.

Deepening Disparities and SDG 10: Reduced Inequalities

The economic gap between local and foreign populations directly contravenes the objectives of SDG 10. Key factors contributing to this inequality are:

• Income Disparity: A two-tiered economy is emerging where foreign residents earning in stronger currencies (e.g., U.S. dollars) can afford rapidly increasing costs, while local residents earning in Mexican pesos are priced out of their own communities.
• Displacement of Local Businesses: The closure of legacy businesses in favor of establishments catering to a wealthier, international clientele exacerbates economic inequality and reduces opportunities for local entrepreneurs.
• Perceived Immigration Imbalances: Residents note a disparity between the relative ease with which foreign citizens can reside and work remotely in Mexico, often through visa loopholes, and the significant barriers Mexicans face seeking opportunities in the United States.

Governance and Institutional Failures in Relation to SDG 16

The situation highlights institutional weaknesses that undermine SDG 16 (Peace, Justice and Strong Institutions). Accountability and effective governance are questioned by both local and foreign residents.

• Government Policies: The municipal government’s formal agreement with Airbnb is cited as a primary catalyst for rent inflation, suggesting a policy focus that prioritizes foreign investment over local housing security.
• Lax Regulatory Enforcement: Reports indicate that immigration protocols for foreign remote workers are not strictly enforced, creating loopholes that contribute to the unregulated influx.
• Market Exploitation: Property owners are identified as key actors who capitalize on the situation by overcharging foreign tenants, further fueling the affordability crisis without effective regulatory oversight.

Implications for SDG 1 (No Poverty) and SDG 8 (Decent Work and Economic Growth)

The consequences of gentrification extend to fundamental economic well-being, impacting progress toward SDG 1 and SDG 8.

• Risk of Poverty: As the cost of living escalates beyond the reach of local wages, residents face increased financial precarity and a higher risk of falling into poverty.
• Threats to Decent Work: The closure of multi-generational local businesses represents a loss of stable, local employment. While the digital nomad economy brings foreign capital into the city, it does not necessarily translate into decent work or sustainable economic growth for the local population being displaced.

Analysis of SDGs, Targets, and Indicators

1. Which SDGs are addressed or connected to the issues highlighted in the article?

   • SDG 10: Reduced Inequalities – The article highlights the growing economic gap between local residents earning in Mexican pesos and foreign “digital nomads” earning in dollars, leading to the exclusion of locals from their own neighborhoods. It also touches upon the disparate nature of migration policies between the US and Mexico.
   • SDG 11: Sustainable Cities and Communities – The core theme of the article is gentrification in Mexico City, which directly impacts housing affordability, the sustainability of local culture and heritage, and the overall inclusivity of the urban environment for its long-term residents.

2. What specific targets under those SDGs can be identified based on the article’s content?

   1. SDG 10: Reduced Inequalities

      • Target 10.2: By 2030, empower and promote the social and economic inclusion of all, irrespective of origin or economic status. The article discusses how local Mexicans are being economically excluded as prices rise to cater to high-earning foreigners. A quote highlights this: “from the moment that we started getting charged as if we’re all making dollars, everything went to shit.” This points to a failure to ensure the economic inclusion of the local population.
      • Target 10.7: Facilitate orderly, safe, regular and responsible migration and mobility of people, including through the implementation of planned and well-managed migration policies. The article touches on this by describing Mexican immigration policy as “probably some of the easiest in the world,” with loopholes allowing foreigners to overstay visas and work remotely. This, combined with the government’s agreement with Airbnb, suggests a lack of well-managed policies to mitigate the negative impacts of this mobility on the local population.

   2. SDG 11: Sustainable Cities and Communities

      • Target 11.1: By 2030, ensure access for all to adequate, safe and affordable housing. The article directly addresses the lack of affordable housing for locals due to gentrification. The mention that President Claudia Sheinbaum “signed the agreement with Airbnb that has dramatically increased prices in Mexico City” explicitly links policy decisions to the decline in housing affordability for residents.
      • Target 11.4: Strengthen efforts to protect and safeguard the world’s cultural and natural heritage. The article provides clear examples of cultural heritage being threatened. It notes that traditional establishments like “pulquerias… are a less common sight” and “businesses that have been open for over half a century are suddenly shutting down.” The comment that “even the salsas have been gentrified” further illustrates the erosion of local cultural practices.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

   1. For Target 10.2 (Promote inclusion):

      • Implied Indicator: The disparity in cost of living relative to local vs. foreign income. The article implies this can be measured by tracking the affordability of goods, services, and rent for individuals earning in Mexican pesos versus those earning in US dollars. The quote about being “charged as if we’re all making dollars” is a qualitative expression of this indicator.

   2. For Target 10.7 (Well-managed migration):

      • Implied Indicator: The number of foreign nationals overstaying visas or using tourist visas for long-term remote work. The article suggests this is a significant issue, stating, “If you overstay your visa there really isn’t any penalty… I know people who have done that, left, and came right back.”

   3. For Target 11.1 (Affordable housing):

      • Implied Indicator: The rate of increase in rental prices in neighborhoods popular with foreigners. The article directly links the agreement with Airbnb to a dramatic increase in prices, which serves as a clear, measurable indicator of declining housing affordability.

   4. For Target 11.4 (Protect cultural heritage):

      • Implied Indicator: The rate of closure of traditional and long-standing local businesses. The article provides specific examples, such as the disappearance of pulquerias and the shutdown of businesses open for over 50 years, which can be tracked to measure the loss of tangible cultural heritage.

Summary of Findings

Source: cntraveler.com