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Rio de Janeiro Needs More Than a Party Now

Revelers celebrate with instruments at the Carmelitas bloco street party. Footage by Bloomberg

Driving in downtown Rio de Janeiro the other day, I had to slam on the brakes as a sequined carnival reveler wearing a Speedo and fishnet stockings danced across the thoroughfare. His companion, in devil’s horns and a cache-sexe, gamboled by his side with a traffic-stopping pageant of merrymakers in tow.

For Brazil’s signature city, February is always the zaniest month. But this year’s pre-Lenten catharsis — the first no-holds-barred Carnival since the eve of the Covid-19 pandemic in 2020 — cranked the collective frenzy up to 11.

Brazil lost nearly 700,000 lives to the pandemic — the world’s second-highest death toll. Few cities were hit harder than Rio, a metropolis of 6.77 million people, which suffered 38,000 fatalities from Covid-19, the second-highest death rate (505 per 100,000 cases) of all 27 Brazilian state capitals.

Three years on, the pall is slowly lifting. With street parades at every turn and the Sambadrome pageant back in business, city hall estimated this year’s carnival pumped around 4.5 billion reais ($864 million) into the municipal economy, a 12% lift over 2020. Tax receipts rose 20%, while hotel occupancy over the four-day holiday hit 96%.

But Rio needs more than a good party. The pandemic’s knock-on effects shuttered businesses, nightspots and legacy restaurants — a blow to this vibrant hospitality economy, 87% of which owes to services. The job market collapsed and social mobility hit a wall. Despite massive federal cash outlays to shield vulnerable groups, 16.7% of city dwellers were living in poverty by 2021 — compared with 11.8% in 2019 — and up to twice that rate in Greater Rio.

Yet while numbers are still scarce, Rio has begun to shake off its pandemic torpor. By mid-2022, the city’s economy was expanding by 1.6% compared with just 1.2% growth of national GDP. Retail is stirring again, as is the job market. For the first time since 2016, unemployment fell below double digits, to 9.8%, by mid-2022. That has put more money into shallow pockets: After dropping sharply during the global health emergency, Rio’s average monthly income climbed back nearly to pre-pandemic levels by the third quarter of last year.

As the city continues to heal, it will also have to rethink its path forward, not just to prepare for the next contagion but also to confront the host of homemade scourges — glaring inequality, digital exclusion, and urban crime and delinquency — that the public health emergency laid bare or made worse.

While there is no shortcut to revival, the emerging post-pandemic consensus is that more of the same will not work. For Rio, that means jettisoning the emerging world’s bad habit of indulging urban sprawl to hurl up new homes, streets and whole neighborhoods from the dust.

Rio’s recovery starts by resuscitating the center city, and local government is banking on big incentives to coax people and businesses to return. “For a long time, living downtown was unfashionable, even prohibited,” said Francisco Bulhões, municipal secretary of economic development and innovation. “That needs to change.”

Shoppers at the Uruguaiana Municipal Market in downtown Rio de Janeiro on April 5, 2022.
Shoppers at the Uruguaiana Municipal Market in downtown Rio.
Photographer: Maria Magdalena Arrellaga/Bloomberg
Shoppers in the Ipanema neighborhood of Rio de Janeiro on March 2.
Shopping in upscale Ipanema.
Photographer: Dado Galdieri/Bloomberg

The city’s big policy bet is Reviver Centro (Revive Downtown), an innovative market-driven plan to add thousands of residential units to the abandoned downtown. Former Rio urban planning chief Washington Fajardo, who dreamed up the plan, allows it won’t be easy. While Cariocas, as Rio residents are known, are fond of downtown, they are loath to live there. (Realtor QuintoAndar classifies the center city as a “medium security” zone.)

Rebuilding a cluttered downtown involves messy demolitions or expensive refitting of old buildings. So city hall has sweetened the pot by offering developers who commit to building in the center city generous tax breaks and the right to raise skyscrapers, plus new concessions to build in more commercially attractive neighborhoods. Indeed, one promised side effect of the envisioned downtown revival are flocks of building cranes looming over upscale Ipanema, Barra da Tijuca and other moneyed neighborhoods.

Rebooting Brazil’s “marvelous city” will take a lot more. The former national capital lost industry and financial might to Sao Paulo and political clout to Brasilia, and it has been struggling ever since.

Rio’s malaise was hastened by heroic engineering gone awry. Early last century, Brazil’s then-capital was a hothouse for smallpox, yellow fever, cholera and other infectious diseases. The authorities believed that only by razing the claustrophobic downtown could the pestilent metropolis be saved. The idea was to tropicalize the 19th-century makeover of Paris by demolishing airless ghettos, bulldozing the hills they sat upon, and scraping out broad boulevards to let the city breathe.

Aerial view of Copacabana Beach in Rio de Janeiro as locals and tourists enjoy nice weather on presidential runoff day on Oct. 30, 2022.
Copacabana Beach.
Photographer: Wagner Meier/Getty Images

Instead of Paris, Rio got slum removal, gridlock and the suburbs from hell. As the city swelled — from 811,433 people in 1920 to 6,320,446 by the last complete census in 2010 — ghastly housing projects and improvised neighborhoods erupted, often without adequate sewage, electricity or garbage collection, and far from work. The result was a dysfunctional metropolis, hollow at the core and growing more disorderly with every new project.

Rio had the world’s 17th-worst traffic on last year’s TomTom index. Only Istanbul and Mexico City have a larger share of commuters condemned to spending more than two hours a day stuck on the road, according to Moovit in 2022.

A.T. Kearney, a consultancy, ranked Rio at 78 out of 156 cities on its 2022 leading global cities index, down 26 places in just five years. The city’s future looks even bleaker: falling 74 places in five years to No. 142 on the urban outlook index. Although Rio placed 10th on a list of 100 smart Brazilian cities in 2022, it rated only 61st in quality of life.

The city’s report card may look even worse once the full impact of the pandemic is accounted for in the pending census, which after a three-year delay is finally due later this year.

Yet these are all own-goals for a town known for its neglected talent and squandered charm. Consider that cleaning up Rio’s storied Guanabara Bay, which in a few decades went from tropical idyll to a toxic soup of waste and rotting ships, would add inestimable value to downtown real estate while removing millions of poor coastal residents from harm’s way. Architect Sérgio Magalhães, Rio’s former housing secretary, says that transforming the decadent urban rail system into a modern metro (with renovated stations and dynamic signaling instead of fixed schedules) could liberate millions of Cariocas from last century’s polluting, traffic-clogging bus system.

Abandoned, rotting ships float at the Sao Lourenco canal in Guanabara Bay on Jan. 26.
Abandoned, rotting ships in Guanabara Bay.
Photographer: Dado Galdieri/Bloomberg

For all its disrepair, few New World cities offer Rio’s easy walk through five centuries of world-class architecture — including the colonial-era São Bento monastery, the Belle Epoque Theatro Municipal and the modernist gem Capanema Palace. The city placed eighth in innovation and economic dynamism out of 415 Brazilian cities surveyed in 2021, and 46th in overall competitiveness.

Throw in a knack for the creative economy — credit Rio for bringing Broadway production values to Carnival — and Cariocas have a post-pandemic opportunity to rewrite the rules for a more durable, equitable and irrepressibly urban future.

New World Cities “pass from first youth to decrepitude with no intermediary stage,” the anthropologist Claude Levi-Strauss bemoaned in “Tristes Tropiques,” his 1955 classic about Brazil. A new generation of city managers got the memo. Whether they can take those plans to town is another story.

A bar in the Leblon neighborhood of Rio de Janeiro on March 2.
The view from a bar in the Leblon neighborhood of Rio.
Photographer: Dado Galdieri/Bloomberg

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