Bridging Development -

The Medellin Experience

Medellin has come a long way. From being a city notorious for violent

insurgencies and widespread narco trafficking, to what it is today - one

of the most vibrant cities in Colombia and the Latin America region,

serving as a melting pot for innovation and progressive business

activity. The transformation of Medellin clearly validates the premise

that true development springs from the capacity of government to build

„bridges‟ among different sectors and forge partnerships in addressing

complex institutional problems.

February 2011

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Medellin Today

The city of Medellin is the capital of the Department of Antioquia and Colombia‟s second largest

city. Currently, the metropolitan area of Valle de Aburra, where Medellin is located along with 9

other municipalities, has a population of 3.5 million people, while around 2.3 million people inhabit

the city proper.1 With a national population of around 44.9 million, the metropolitan area of

Medellin comprises around 7% of the population. Since 2000, the city‟s metropolitan population

has been increasing by around 3%, which gives indication to an increasing concentration of

commercial and economic activity and development.2

The city today is considered as one of the most prosperous and productive locations in the

country, with a dynamic economic landscape (Table 1). The city‟s GDP in the year 2009

amounted to around US$16.9 million and contributed to around 7% to Colombia‟s GDP. It is

worth noting that while the city‟s GDP slowed down by around 5% in 2009, decreasing from an

output of around US$17.7 million in 2008, the country‟s economy exhibited growth of around 16%

since 2004.3

Table 1: Medellin GDP (2004-2009)

Source: Planning Direction – Municipality of Medellin

1 Planning Direction – Municipality of Medellin

2 United Nations World Urbanization Prospects Report 2009

3 Source: DANE (Domestic Accounts), DNP, EIU (Market Indicators and Projections). Note: * EIU Projection for the

World. Note: Last Update: March 25, 2010.

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Because of the city‟s increasingly progressive business environment, Medellin today is also

viewed as an emerging business hub, ranking among the Top 15 cities most conducive to do

business in the Latin American Region (Table 2).4 Today, the city is home to large multinational

companies such as Owens Illinois, Sab Miller, Phillip Morris, Procter & Gamble, Renault Toyota,

Teleperformace, Allus Global BPO, Unisys, among others Further, 19 out of the 100 largest

enterprises in Colombia have their headquarters in the city (Table 3).

Table 2: Medellin Ranking in Best Cities to Do Business in Latin American Region by

América Economía Magazine

Source: Ranking of América Economía Magazine “Best Cities to Do Business in Latin America 2010

Medellin has been very proactive in transforming itself into a digital, information-based city,

consistent with the country‟s plan on developing Medellin‟s Information and Communications

Technology (ICT) capacities. One of the clear manifestations of this effort has been the adoption

of e-Government platforms for specific local government portals - spearheaded by the local

program - Medellin Digital. This initiative has allowed more transparent governance, as well as a

more proactive citizen participation in the political system through an interactive feedback

platform such as the Citizen‟s Perception Survey.

Another notable result of this trust towards developing an information-based society has been the

establishment of a Library Network, led by the local government in partnership with the public

utilities company, Empresas Públicas de Medellin (EPM). Thirty-four public libraries in the

metropolitan area are connected through a municipal network – providing connectivity (Internet)

and facilitating the fluid transfer of information to more than 40% of the local population. This joint

initiative won the Access to Learning Award by the Bill-Melinda Gates Foundation in 2009 for the

4América Economía Magazine Issue 387/May 2010. Ranking of Best Cities to Do Business in Latin America

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promotion of awareness through the use of technology. Furthermore, the city was recognized as

the Second Digital Metropolitan City in Ibero-America in the 10th Congress of Digital Cities in the

same year, in recognition of Medellin‟s commitment towards developing the city‟s IT capabilities.

Table 3: Major Businesses Headquartered in Medellin

Rank Business Sector

2 Almacenes Éxito Hypermarket

10 Grupo Nal. De Chocolates Food

11 EEPPM E.S.P. Public Utilities

12 Cementos Argos Cement

16 ISA Energy

27 Alkosto-Corbeta Hypermarket

28 Epm Telco S.A. E.S.P. Telecommunications

29 Postobon Beverages

31 Sofasa Vehicle Assembly

35 Colanta Dairy Products

38 Solla Animal Food

39 Isagen Energy

49 Productos Familia Paper Products

62 Colpapel Paper Products

70 Colceramica Construction Materials

85 Susalud EPS Health Insurer

86 Avon Colombia Cosmetics

95 Contegral Animal Food

98 Comfenalco Antioquia Family Compensation Fund

Source: Araújo Ibarra - Consultores en Negocios Internacionales 2009

Equally important, the city has taken prudent, yet effective steps in promoting itself as a secure

place to live and do business. Today, Medellin can boast of having a quality of life that is at par,

or if not altogether better, than many other more prominent cities in Latin America. In terms of

security, the local government has been successful in reducing the occurrences of crime and

murders – with a significant decline in the murder rate experienced in the last decade. For

instance, from a homicide rate of around 160 per 100,000 people in 2000, it stood at around 95

per 100,000 in 2009, translating to a reduction of around 6% per year in the number of murders,

or an astounding 40% drop from 2000 to 2009. The city shares the country‟s progress in homicide

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reduction, with Colombia achieving a drop of approximately 44% over the same period, signifying

success in Medellin‟s persistent campaign to improve local security conditions.

Second, in terms of poverty reduction, the city has made significant headway, with Medellin‟s

poverty incidence decreasing by around 22.5 % from 2002-2008: from around 49.7% % to 38.5%

of the population being considered poor. This is further testament to the local government‟s

steadfast commitment in delivering opportunities for its citizens. For instance, in terms of health

care, Medellin has increased its services especially for early childhood health, with the

government successfully reducing child mortality due to malnutrition to zero. Also, support to new

entrepreneurs towards strengthening Medellin‟s entrepreneurship culture has been expanded

through programs such as Cultura E – which has provided opportunities for business oriented

citizens. Out of this, 108,000 more jobs have been created, increasing labor force participation in

the city to around 64%.5 The country has also been successful in reducing poverty. From around

50% of people considered poor in 2002, the figure dropped to around 43% in 2008, signifying the

government‟s focus in providing more opportunities for Colombians. Consistent with this,

government social spending per capita increased with the government‟s cash-transfer program

increasing from 220,000 families to around 3 million.6

Today, Medellin has developed into one of Colombia‟s most progressive and productive areas. It

has become a melting pot of innovation and of ground-breaking initiatives for research and

development. It has gained the attention of business and political leaders and has hosted

international events such as, the 38th General Assembly of the OAS – Organization of American

States in 2008 and the IDB (Inter-American Development Bank) Assembly in 2009, which was

attended by nearly 5,000 international delegates. Medellin has also become a vibrant tourist

destination. Since 2004, there has been a 196% increase in the number of travelers visiting

Medellin, from around 55,000 in 2004 to around 163,000 in 2010.7

Medellin‟s ascension to where it is today is remarkable. Much of these improvements in the socio-

economic fronts have been attributed to the city government‟s careful and strategic identification

of a root cause that had previously hindered development in the city - human security. Through

this focus, measures aimed at improving and ultimately increasing the opportunities for the

citizens of Medellin were successfully implemented, and as will be discussed in the next sections.

5 Medellin Cómo Vamos 2009

6 Forero, Juan. “Despite billions in U.S. aid, Colombia struggles to reduce poverty.” The Washington Post 2010

7 Three Axes Report of Antioquia. October 2010. Proexport Colombia.

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Medellin - The Past

Conflict has been an integral aspect that has characterized the socio-political landscape of both

Colombia and Medellin. Since the 1980s until the late 1990s, Medellin was a hotbed of murder,

crime and illegal drugs.

The Medellin Cartel

Illegal narcotic traders and producers were located in the city of Medellin and had gained a virtual

monopoly of production and trade in the region. Several of these traders gave rise to one of the

region‟s most powerful and dangerous organizations – the Medellin Cartel. It was estimated that

at its peak, the cartel earned nearly US$60 million per day from its illegal activities and soon, the

cartel‟s reach expanded to various parts of the Americas, as well as into Europe and Asia.8

During the 1980s - Medellin gained notoriety for being the drug capital of the world.

Locally, life was very insecure for the citizens of Medellin. Gangs and local militias form the

extreme right and left groups were widespread, some who were allied with the cartel. The role of

the police and the military had been obscured because of corruption. In terms of daily living,

allying oneself with gangs or militias secured survival, while drug trafficking, theft, and robbery

remained the most lucrative means of livelihood. In these darker times, many of the city‟s youth

were recruited as cartel bodyguards.9 During this period - from the late 1980s to 1991, the city‟s

murder rate increased by around 150%, from around 150 murders per 100,000 people to 381 per

100,000 people in 1991 (Table 4).

Table 4: Medellin Murder Rate

Source: Medellin Cómo Vamos 2009

8 Tholons Research 9Generation Under Fire: Children and Violence in Colombia. Human Rights Watch/Americas. 1994

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Heightened violence accompanied the expansive drug production and trade, leading to numerous

killings of journalists, police and even bystanders. Fearing extradition threats from a joint treaty

between the United States and Colombian government, the Cartel allegedly initiated the siege of

the Supreme Court by left-wing guerillas in 1985, leading to the deaths of half of the judges

present.

Heightened military and police interventions, along with support from the United States and rival

Cali Cartel led to the downfall of the Medellin Cartel, ending with Pablo Escobar‟s death in

December 2, 1993.

Left-Wing Guerilla Insurgents and Right-Wing Paramilitaries

Apart from the drug cartels in the country, Colombia had also been in armed conflicts with leftist

groups like the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation

Army (ELN), continuously challenging the government. Since the 1960s, these groups have been

establishing strongholds in rural areas and poor communities, exercising control over the

impoverished population, and recruiting members among the youth.10

Activities of these groups

included kidnappings, hostage-taking and blackmailing, as well as drug trafficking.

On the other side of the spectrum were paramilitary groups, prominent of which was the United

Self-Defense Forces of Colombia (AUC). Aimed at neutralizing the insurgencies caused by the

left-wing groups, the ranks of these groups came originally from cartels but spread among the

landlords, growing impatient of the government‟s inability to suppress the left-wing groups‟

attacks. Their activities include counterattack measures against the left-wing and suppressing

suspected sympathizers.11

Improving Security for Social Development

Violence and drug trade persisted on in the 1990s and well into early 2000s with the murder rate

in Medellin averaging at around 170 murders per 100,000 people from 1994 to 2002. In 2002,

independent candidate Alvaro Uribe won the presidential elections, and in coming into office, his

mandate was clear: to address the country‟s security challenges brought about by narco

trafficking and violent conflicts.12

With the help of the United States through its Plan Colombia, the

military was able to reduce the number of coca plantations from around 170,000 hectares in 2001

to around 114,000 hectares in 2003. In response to the violence, Uribe increased the military and

police force, adding more than 36,000 troops in the military and 7,000 police officers all over the

country from 2002-2004. Uribe also instituted aggressive military action towards the left and right-

wing groups. For instance, in 2002, he enforced “Operation Orion” in the 13th Commune in the

city of Medellin, with the military successfully taking out FARC‟s outpost in the Antioquia region.13

However, efforts did not stop there. The Colombian government provided sources of livelihood for

the coca planters, planting more than 45,000 hectares of alternative crops. In addition, social

development initiatives were also implemented. From 2002-2004, more than 835 infrastructure

10 Amnesty International USA 2005, Tholons Research 11 The Heritage Foundation 2001 12 Luis Alberto Moreno.“After a Dark Period, a Better Colombia”. The Boston Globe 2004 13 BBC News 2002

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projects were implemented, providing basic services such as education and sanitation to the

people of Colombia. Because of this, during the same period, public education enrollment

increased from 7.8 million to 8.6 million, while more than 3 million Colombians gained access to

health services, and more than 1.2 million jobs were created. In addressing the country‟s security

issues, Uribe opened discussions with the right and left groups, negotiating their disarmament,

and offering reintegration measures into Colombian society. Such measures were warmly

considered, for instance, in the city of Medellin, more than 400 paramilitaries were disarmed and

prepared for returning into the social fabric of the city.14

The Colombian government‟s initiatives proved to be dynamic in terms of improving the security

conditions in Colombia‟s countryside. While focusing on quelling the violence brought mainly

about by widespread narco trafficking, government also introduced socio-economic opportunities

especially to the paramilitaries and coca planters, continually pushing for a change process

based on inclusion. Adding to this, Medellin‟s political leaders implemented public policies across

social programs and urban interventions.

Medellin’s Transformation

The experience of Medellin is indeed one worth of investigation, and many national and local

governments across the globe, who have encountered similar hurdles, have taken interest in the

city‟s transformation. The following section looks into the factors that have enabled Medellin to

transform into one of the most vibrant and progressive cities in Colombia.

Focused and Inclusive Government-led Initiatives

The transformation of Medellin was a product of strong and focused social mobilization. As

discussed in the previous section, the Colombian government invested in strengthening its

military force and deployed more police forces in the country‟s communes, ensuring security and

safety - consistent with the Uribe administration‟s priority to quell the violence brought about by

insurgencies and narco trafficking widespread in the country

Meanwhile in Medellin, then Mayor Sergio Fajardo shared the same sentiments for the city, but

focused his efforts from a different perspective. He realized that Medellin‟s development, and true

transformation, was hinged on the improvement of the city‟s quality of life: providing better living

conditions to the city‟s inhabitants would lead to a reduction in violence and improve the city‟s

security conditions. He realized that there were limited opportunities, leading people to join rebel

groups or resort to drug trafficking. In order to achieve this however, a concerted and

collaborative effort was required between and across institutional stakeholders and the citizenry.

Coming into office in 2004, he instituted a framework that included various sectors of society,

focusing each sector‟s capabilities in developing the city. Such framework was integrated into the

city‟s development plan.15

14 Luis Alberto Moreno. “After a Dark Period, a Better Colombia.”The Boston Globe 2004

15Medellin Mayor Tells Tale of Change in Colombia. Cornell Daily Sun 2009

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The Medellin Development Plan

The Medellin Development Plan, spanning from 2004-2007, was designed in response to the

challenge of the lack of opportunities for human development widespread in the city. It was a

framework driving integrated urban intervention projects encompassing the physical, social, and

institutional aspects of development, aimed at resolving specific, targeted issues over a defined

territory through focused use of development tools such as social opportunities.16

The Medellin

Development Plan served as the basis of most of the Medellin LGU‟s development interventions.

It was developed and closely monitored by the office of the Mayor of Medellin and the Planning

department of the Municipality of Medellin.

The Medellin Development Plan is grounded on multi-stakeholder participation and inclusive

development – the social aspect of integrated urban intervention. In such a context, all members

of the community are active in identifying the problems and opportunities given their present

condition. This is done by establishing mechanisms and means for participation and creating

spaces for information and dialogue. In a talk in Cornell University, Mayor Fajardo emphasized

that these measures empowered the people and elevated their self-esteem in taking part in

community efforts.17

Mechanisms of dialogue included workshops and scenario-building sessions

wherein community members were asked to participate in the formulation of development plans

by illustrating their visions of a developed city. This was particularly important in the development

of Communes 1 and 2 of Medellin, for instance.

16Centre for Strategic Urban Development (CIDEU) 2004 17Medellin: From Fear to Hope. Cornell University 2009

Case Study

Imagining Development - The Case of Communes 1 and 2

Communes 1 and 2 are characterized by intricate topography, being located at hilly terrains

at the northeastern part of the city. Therefore there is a lack of efficient transport system,

which renders development rather slow, making out of the northeastern section one of the

most impoverished areas in Medellin, with hundreds of informal settlers inhabiting it. As such,

communes 1 and 2 were the first to be administered with the integrated urban development

approach. The local government organized the communities in groups to gather their ideas in

relation to their current situation and how they imagine their community. The citizens were

asked to illustrate, by drawing, their imagined community, which answered the following

questions: “How do I imagine my park? What does this place mean to me? Which memories

does this place bring to me? What would I like that the park would have? How would I call my

park?” Out of the interventions, specific places, facilities and equipment were identified as

important to the community. These included the MetroCable, built in connection with the

existing Metro to provide easy access for the citizens from the northeastern areas to connect

with different parts of the city, and further complemented by numerous library parks, high

quality schools, and public spaces implemented especially in low income sectors of the city.

Source: Blanco and Kobayashi. Urban Transformation in Slum Districts through Public Space: Cooperation & Investment Agency of Medellin and the Metropolitan Area – ACI 2011

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The institutional aspect of development is another important factor for Medellin‟s Development

Plan as this specifically identifies the establishment and coordination of efforts from various

sectors and working together to achieve a (common) desired outcome for the city. One major

case in the term of Mayor Fajardo was concerned with the reintegration of former combatants

mainly from AUC groups into the social fabric of Medellin. In 2003, there were around 4,200

demobilized individuals in Medellin which needed to be reintegrated back into the society. In

response, the LGU devised a reintegration process called “Peace and Reconciliation.” With the

help of various NGOs, the former combatants were given individual psychological attention and

therapy as well as social group intervention sessions. With the help of the National Council for

Peace and Reconciliation this previously marginalized sector was given educational assistance,

and through partnerships with the private sector, they were provided avenues for employment.

Further, interventions were conducted with the victims of combatants in order to foster

reconciliation.18

Outcome of Coordinated Efforts: Social Opportunities

The efforts of community engagement and multi-stakeholder coordination brought about physical

and institutional changes in the city. For instance, in the public policy termed “Medellin, the Most

Educated,” were conceived programs for different purposes: public places for education such as

schools were set up in the poorest areas of the city – with a special emphasis on the hillside

areas which were often deemed least accessible – and through the coordination with the public

utilities company, Empresas Públicas de Medellin (EPM). Also, no less than five library parks in

those same areas have since been constructed and with the help of Fundación EPM. These

facilities provided free Internet access, computers, and books to the poor and function as new

public spaces.19

In addition, these centers were purposely connected to Municipal Libraries

through a network known today as the Medellin Library Network which links more than 30

libraries in the city, providing a more fluid transfer of information across libraries and increased

access to books and literature. Infrastructures such as the MetroCable serve to provide increased

connectivity among the different communes of the city, and today, there are more than 70,000

people using the MetroCable on a daily basis, especially those from the uphill communities. Aside

from this, from 800 combatants reintegrated into the community in 2004, more than 4,000 were

eventually brought back to the social fabric during Mayor Fajardo‟s term. Also the LGU developed

entrepreneurship opportunities through its Cultura E program by establishing the Cedezos or

centers of entrepreneurship in the different communes for citizens to venture into businesses, and

wherein support was provided by government in providing microcredit financing to budding

entrepreneurs. From these interventions, the city experienced a decline of 44% in the number of

homicides in the city from 2002-2004, and enjoyed a further decline of 15% in murder and crime

during his term from 2004-2007. GDP in Medellin in the same period also grew by an impressive

23%.

18 Ibid. 19 Ibid., Empresas Públicas de Medellin 2009

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A Sustainable Initiative

Mayor Fajardo‟s term ended in 2007, and was succeeded by Mayor Alonso Salazar. Upon

entering office, the administration of Mayor Salazar continued to focus on education, social

welfare, and creating spaces for inclusion for its citizens, all under the premise of collaboration

and multi-stakeholder participation. All these were integrated into Medellin‟s Development Plan

for 2008-2011, aimed mainly at continuing the local government initiatives during Fajardo‟s term

and further developing projects for the improvement of the city. Some of the initiatives under the

plan include the expansion of open schools and spaces for education. In addition to the 5 existing

library parks, Mayor Salazar intends to add 5 more library parks, in partnership with Fundación

EPM, to the city‟s vast library network, and providing more spaces for learning for the citizens of

Medellin.20

Also, integrated urban projects in partnership through the EDU in the northwestern

and central-eastern parts of the city are currently underway, instituting the same participative and

consultative approach as those in Communes 1 and 2, aimed at improving the security conditions

in those areas of the city.21

It is noteworthy that in transitioning into Mayor Salazar‟s administration, sustainability was

achieved with regard to the framework, initiatives, and measures implemented during Mayor

Fajardo‟s term, translating to greater fluidity and focus in the city‟s overall development. In 2010,

in honor of the transparent public administration and effective management of development that

Mayor Salazar has led, the city received the Habitat Scroll of Honor by United Nations for the

successful implementation of two of his most remarkable programs on the development plan.

One of which is “Medellin Solidary,” a program that aims at improving the living conditions and

promoting autonomy and integrated development of 45,000 of the city‟s most vulnerable

households. Second is the “Good Beginning” project, a program that promotes integrated

development to early childhood emphasizing on initial education. Both programs strive ultimately

towards holistically developing the city‟s productive, competitive, and innovative capabilities,

starting from the family as the base of society and reducing the social gap with equal

opportunities and living conditions for every citizen.

Also, as complement to the social and entrepreneurship programs, initiatives to promote

innovation culture and to lessen the digital gap across the citizens have been implemented.

Medellin IT Development Initiatives: Medellin Digital and Ruta N

Consistent with the government‟s commitment in further improving the city‟s security conditions

and presenting social opportunities for its citizens, the local government of Medellin focused on

developing the city‟s IT capabilities, aiming at turning the city into a digital, information-based

society geared towards innovation and entrepreneurship. Two important programs instituted were

Medellin Digital under the Secretary of Education and the establishment of Ruta N.

Medellin Digital

Under the office of the Mayor of Medellin, Medellin Digital was a program created which aims at

increasing the digital literacy of the citizenry of Medellin. In line with the Medellin Development

20Empresas Públicas de Medellin 2009 21 Municipality of Medellin Portal 2010

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Plan, the program is grounded on empowerment and inclusive development, by providing access

to various forms of information technology facilities and developing the talent capabilities in the

knowledge and usage of such resources.22

In support of these two main thrusts, the government has provided facilities and resources for its

citizens to access the Internet and connect with the world beyond the city. A significant initiative

of the government in achieving this objective was the creation of open classrooms as a result or

second step of digital classrooms. These are locations wherein the citizens can access

information technology, attain familiarity with the use of ICT, and ultimately access information

through the Internet when the classrooms are not being used by students. Such facilities are

located in public areas, such as library parks and schools. These facilities are freely accessible: in

Commune 13 for instance, there are more than 60 units of desktop PCs in Stella Velez School,

and is open for public use with free Internet access.23

By the end of 2011 the program is expected

to reach a total of 200 public schools out of a total of 430 in the city.

In addition to the provision of infrastructure, the government has supported the development of

the city's talent through the promotion of strategies and activities in the conscious use of

information technology. As such, training programs and learning networks are created to further

develop the literacy of the community in the use of ICT facilities. It is important to note that in the

open and digital classrooms, students and citizens are trained in tools like Hot Potatoes, Google

docs, Jclic, ZOHO, Blogs, Wiki, Movie Maker, Audacity, Voki, Camstudio, among others. Also, the

Online Entrepreneurs & Entrepreneurial Literacy Plan (PADE) is designed to train the city‟s

entrepreneurs in the use of ICT in their businesses and strengthen business practices. The

program provides eight places of entrepreneurship (Cedezos) with 15 laptops with free Internet

access. Added to this were workshops and talks on the use of tools and programs like Microsoft

Office, design programs like Adobe Photoshop, Flash, and web page creation, as well as

workshops on marketing and advertising on the Internet, electronic newsletters, and Google

applications. Out of this initiative, there have been more than 730 entrepreneurs trained, with

around 130 people trained in the use of Adobe Photoshop and Flash web design.24

Aside from these efforts and outcomes, the program remained faithful to its participative thrust by

providing opportunities for the citizens of Medellin to take part in the political process. The

government, through the program, instituted the Citizen Perception Survey. The survey,

conducted yearly, serves to consult the citizens on the influence and the effectiveness of

government agencies as well as their projects in the development of the city, tackling issues such

as quality of life, economic development, health, and education. Results of the survey are

collected and published by Medellin Como Vamos (“Medellin, How are We Doing?”), an agency

tasked to monitor the city‟s progress.25

Ultimately, the drive for a more information-based society has empowered the citizens of Medellin

to participate in the development of their city. The efforts and initiatives under the program

increased citizen awareness of opportunities through easy access to information, allowing them

22Medellin Digital 2010 23“A Further Open Classroom for the Digital City.” Medellin Digital 2010 24“Strengthening Business Ideas.” Medellin Digital 2010 25“The Digital City in the Minds of Citizens.” Medellin Digital 2010

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to become more aware of opportunities for advancement through the workshops, and most

especially, actively participate in policy-making of the local government.

Ruta N

Aside from developing the city‟s IT capabilities, the government also focused on developing the

city as a science, innovation, and technology center. Thus, Ruta N was established by the office

of the mayor and is dedicated at developing the city of Medellin into a knowledge-based,

entrepreneurial center, equipping the city with capabilities towards higher quality business

initiatives.26

This framework entails the provision of access to capital to entrepreneurs through a

fund of Innovation where projects on applied research and innovation are supported, while

promoting access to venture capital. As discussed previously, the government provides facilities

such as computer laboratories and open spaces for IT literacy through the Medellin Digital

program, promoting especially the integration of IT in businesses initiatives.27

More importantly, the agency has been tasked to promote and provide access to markets,

building connections with local and foreign markets and potential partners in developing the

innovation-related capabilities of the city. Some initiatives include fora such as the Colombia MIT

Enterprise Forum, where experts share knowledge, insights, and resources in entrepreneurship

and innovation. Also, the agency promotes networking and collaborative work between graduate

students from the university system and existing business entities, in defining plans to boost

international access to markets abroad, targeting high-value products and services through its

Laboratory of Market Access (MAB) program. In 2010, for instance, 33 MBA students from the

University of Medellin and University EAFIT participated in the program. They worked with 7

SMEs from the Digital Content, Software Development, and Engineering Services sectors in

defining business models for overseas markets.28

Ruta N‟s programs have instilled a culture of innovation in the city‟s entrepreneurs through the

various fora and programs linking the academe with companies present in the city. In effect, the

programs served to increase the business sector‟s awareness on the importance of Science and

Technology and innovation not only in their respective businesses, but ultimately in the overall

development of the city‟s business environment.

Government initiatives through Ruta N and Medellin Digital highlight Medellin‟s commitment in

improving and further developing the business environment of the city and the capabilities of the

citizenry. First, the programs mainly improved the existing business environment of Medellin,

wherein specific IT solutions and software applications, supported by Internet access, have

improved decision-making and inspired innovation amongst business entities towards the

advancement of their operations. Also, fora and collaborative network-building efforts of Ruta N

serve to promote the city‟s capabilities and develop partnerships among local and international

business entities. Second, these developmental initiatives have greatly empowered the citizenry.

Increased access to information translated to more opportunities for people to better themselves,

by venturing in business for instance. This also translated to increased decision-making

capabilities and participation in governance, as seen in the Citizen Perception Survey.

26 Ruta N 2010 27Ibid. 28 Ibid.

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Furthermore, development remained inclusive and consistent with the Medellin Development

Plan: everybody now has access to information and most of the city‟s population is now IT

literate. Most importantly, it is crucial to highlight that this development framework is embedded in

the social fabric of the city, across agencies and among the citizens - rendering the efforts

sustainable over the long-term. This highly progressive environment in Medellin has ultimately

served to accelerate investments and foster business partnerships in the city. The success of the

mentioned programs has been validated by among others, the entry of HP into the city.

HP in Medellin: A model case of Public-Private Partnership for development

HP has been one of the city‟s partners in the development of an information-based, innovative,

and digitally literate city, through its program in collaboration with University EAFIT. The city of

Medellin, particularly University EAFIT, has been a recipient of the HP Technology for Teaching

Grant, which is aimed at integrating technology in the learning environment. The project entails

funding of facilities and technology resources such as tablet PCs, laptops, as well as cameras

and wireless systems that support these platforms. Teaming with HP in developing a more

technologically-based and wireless campus focusing on Math and Sciences, has brought

beneficial developments in the perception and process of learning in the University.29

The said program has been instrumental in classroom development and in building more dynamic

interactions between members of the academe, with the students playing a more active role in

molding and directing the learning experience. Through the use of laptops and tablet PCs, the

students attain more interaction with the subject matter. For instance, students were asked to visit

a civil engineering project and generate their individual reports, which were sent electronically

through email, and later compiled as a newspaper article. In that particular case, the students had

a more direct involvement with the topic of the study, enabling them to participate in the

generation of knowledge through the reports. Also, the experience empowered the students in

bridging the gap between theory and practice, making their learning more relevant. Thus, it was

the classroom that went with the students, instead of the students coming to the classroom. In

addition, there had been more fluid transmission of ideas among students, their peers, as well as

their professors through the use of new technologies. Now, students can more freely

communicate with fellow students and raise concerns to their teachers through the use of various

social media in the Internet as well as email, further increasing the involvement of the student

body in the development of school curricula beyond the teacher‟s input and outlines.30

These initiatives presented by government and partnerships with the private sector to develop an

information-based and innovative society have undoubtedly brought about improvements in the

social and economic fabric of the city. The city‟s business environment improved and public

perception became more positive. As such, these developments can be viewed as catalysts -

opening opportunities for Medellin to venture into the IT-enabled services sector.

29 “EAFIT University: Creating New Ways to Learn”. HP 2007 30 Ibid

15 of 20 © 2011 Tholons

Medellin’s IT-enabled Services Industry

Concerted efforts by various sectors of the city in improving social and security conditions as well

as developing its IT capabilities have indeed brought about great rewards in terms of

investments. Today, Medellin is seen as one of the faster emerging locations for IT and IT-

enabled Services in Colombia, if not for the whole region. In 2010 for instance, the city debuts in

Tholons‟ Top 100 Emerging Destinations report at the 68th spot – recognizing the city‟s notable

gains in developing its ITeS Sector.

As a product of the city‟s continuous improvements in its socio-economic and security conditions,

BPO revenues for Medellin in 2009 registered at around US$180 million, growing around 20%

from levels in 2008. This amount comprised nearly 30% of Colombia‟s BPO revenue of US$570

million in 2009. Also, Medellin‟s hardware and software business revenues in 2008 registered at

US$220 million, growing around 45% from 2007, indicating a greater degree of IT adoption for the

city. This is further attested by the fact that the city of Medellin is home to 6 software companies

which have CMMI certifications (Table 5). One of which, PSL, is the first in the Latin American

Region to achieve CMMI level 5 certification. Such presence of IT companies recognizes the

delivery maturity levels and IT service capabilities of Medellin.31

It is interesting to note that a

large and highly populous location like Mexico City with around 23 million inhabitants has only

around 22 CMMI certified companies, more than double that of Medellin.32

This is quite a

remarkable feat for Medellin, when considering that it‟s smaller population of around 3 million - or

about 1/7th of Mexico City‟s – has nearly half the number of CMMI certified companies. This

substantiates the delivery capabilities (and potential) of Medellin in delivering high-value service

processes.

Table 5: List of Companies in Medellin with CMMI Certifications

Local Enterprise Description Certifications

INTERGRUPO

InterGrupo is a leading multinational company in Colombia and Latin America that provides integrated IT solutions using the latest technologies and outsourced service delivery models, some services include: - Software Engineering Consultancy - Software Development - Infrastructure Solutions

CMMI Level 5 ISO 9001:2000

PERSONALSOFT E.U

PersonalSoft SAS is a company that supports the implementation and improvement of the processes of its clients through the provision of Process Engineering and Software Engineering.

CMMI Level 3 ISO 9001: 2008 PSP Developers

TSP

31 Source: PSL Web Page: http://www.psl.com.co/., Cooperation & Investment Agency of Medellin and the Metropolitan Area –ACI 2009. 32 Tholons Research

16 of 20 © 2011 Tholons

PRODUCTORA DE SOFTWARE S.A - PSL

PSL is a CMMI level 5 company that provides nearshore software development services to clients in the US and Latin America.

CMMI Level 5 ISO 9001

ISO 27001

SERVINTE S.A.

Provides IT solutions for the Health Sector, with integrated systems supported on consultancy services, training, and implementation. They also offer the system updating and ITO services.

CMMI Level 2 ISO 9001

MVM INGENIERIA DE SOFTWARE S.A.

Provides software development services such as: Service support and maintenance of applications, Services Business Intelligence Consulting, SAP consulting services, Service marketing third party products, Platform Management Service IT. MVM has worked for clients in the power and telecom industries, known for their extremely demanding requirements on IT. Working for these IT sophisticated, word-class clients, has allowed them to stand out in the market.

CMMI Level 4 ISO 9001: 2008

ILIMITADA INGENIERIA DE SISTEMAS S.A.

Specializes in telecommunications platforms and biomechanic solutions. Ilimitada has participated in Projects like the Eurocope and others in the region.

CMMI Level 3 ISO 9001

Source: Cooperation & Investment Agency of Medellin and the Metropolitan Area–ACI 2009

Aside from attracting investments, improved perceptions of security and government-led

developments in education and infrastructure attained great impact on the well-being of the city.

Now, Medellin is attracting talent from all over the department of Antioquia.33

Medellin hosts

around 40 of the country‟s 282 Higher Education institutions, providing both university and

postgraduate education programs. In 2009, Medellin‟s graduate output numbers were at about

23,000 graduates, contributing more than 13% of the total graduates of Colombia for the year

(Table 6).34

Also, graduate output in Medellin grew at around 7% from 2007-2009, with

Engineering and Economics courses showing the highest growth rates of around 5% and 11%

respectively. The increased number of graduates further attests to the improved conditions of the

city in terms of educational development and on the competencies of the city in the said

disciplines.

33 Cooperation & Investment Agency of Medellin and the Metropolitan Area–ACI 2009 34 UNESCO 2009

17 of 20 © 2011 Tholons

Table 6: Medellin College Graduates by Course from 2007-2009

Source: Labor Observatory Statistics for Education. Ministry of National Education 2010

Given the high number of Engineering and Economics graduates churned yearly, Medellin today

is attracting companies under the Engineering and Finance and Accounting services sectors,

hosting companies such as Citibank, ABN Amro Bank, Mitsubishi, Yamaha, and vertical related

companies such as Manpower de Colombia and Banco Santander.35

Medellin has indeed begun to capitalize on its existing IT-enabled and highly innovative business

environment to forge partnerships in further developing the city‟s ITeS environment. For instance,

HP‟s investments in Medellin went beyond Public-Private Partnership initiatives in the academic

space. In July of 2010, HP announced the implementation of a new Global Service Center in

Medellin, in partnership with the Medellin local government through the ACI as well as the

National government.36

Highlighting the availability of skilled talent from top-caliber universities,

as well as strong government support in the development of the city‟s IT capabilities, the Global

Service Center is aimed at attracting investments in technology and BPO – serving as a hub of

activities in technological development, back office, and contact support for the city.37

Such developments further attest to the recognition of Medellin‟s continuous drive towards

economic and social prosperity. Admittedly, the city‟s ITeS sector is relatively new, and this

expansion into services globalization is clearly a by-product of strong government support in

improving conditions in the city, opening opportunities for the local government to present more

opportunities for its citizens and further develop the city‟s competencies.

35 Cooperation & Investment Agency of Medellin and the Metropolitan Area–ACI 2009 36 “The Route Starts with Hewlett-Packard”. Ruta N 2010, “HP to Open Global Service Center in Medellin, Colombia, Building on $2.5 Billion of ICT Investment in Country”. The Medellin Travel Blog 2010 37 Ibid.

18 of 20 © 2011 Tholons

Bridging Development – A Conclusion

Indeed, Medellin has come a long way. From being a city notorious for violent insurgencies and

widespread narco trafficking, it has now become one of the most vibrant cities in Colombia,

serving as a melting pot of innovation and dynamic business activity. The transformation of

Medellin clearly attests to the fact that true development springs from the capacity to build bridges

and forge partnerships in addressing the complex problems of poverty and insecurity. The

problems encountered by Medellin are issues that are highly prevalent and are shared by cities

and countries across the globe. The proceeding section aims to bring together learning points

from the Medellin Experience.

Dynamic Change Agent

A critical learning point of the Medellin Experience is the presence of a dynamic change agent

driving the transformative process – in the case of Medellin - the local government.

This change agent is significant in pointing out that these social issues at hand are complex –

spanning years and decades as products of reinforced interactions of systems and institutions in

place – and formulating change initiatives targeting the root causes of these problems. In the

case of Medellin, Mayor Sergio Fajardo saw that the issues of narco trafficking and insurgent

violence were products of deeper issues of lack of opportunities, breeding insecurity and hostility.

Mayor Fajardo emphasized that the youth joining insurgent groups or drug traffickers were often

indirectly pushed to do so in order to have the capability to provide for their own and their family‟s

needs. Thus, in the interventions, Mayor Fajardo included social opportunities in order to widen

the horizons of these groups as well as Medellin‟s citizens. This new horizon in turn provided

new opportunities to improve social and economic livelihood.

Inclusive Development Initiatives

Simultaneous with the realization of the complexity of the issues, another important learning from

the Medellin Experience was that the solutions to these problems required the involvement of

multiple stakeholders. While the change agent realizes the complexity of the issues at hand, the

solutions to these issues did not solely rest on the change agent‟s capabilities (or

responsibilities). As complex issues are reinforced by interconnected and reinforcing structures,

solutions should come out from collaborative means – building relationships and partnerships

through communication and dialogue. In the case of Medellin, Mayor Fajardo realized that in

addressing the security issues of the city and providing social opportunities, that he could not do it

alone. Thus, he involved various sectors in society in the change process in order to realize this

vision. For instance, in the urban development project of Communes 1 and 2 of the city, the local

government of Medellin conducted dialogues with the citizens and through workshops wherein

the needs of the community were identified, and bearing relevant results from the local

government such as the development of MetroCable. In another inclusion driven project, “Peace

and Reconciliation,” the local government partnered with civil society groups and NGOs as well

as the private sector in the reintegration process of former insurgents into the city‟s social fabric,

providing education and employment opportunities in the process.

19 of 20 © 2011 Tholons

Sustainable Transformation

Most importantly, the frameworks for transformation and social opportunities initiated through

partnerships among various stakeholders should attain sustainability, with the gains and

outcomes lasting over the long term. Ultimately, the changes implemented by local government

should institutionalize and establish a more equitable society for its inhabitants. In the experience

of Medellin‟s transformation, the efforts initiated by government in partnership with various

sectors have been consistent with the Medellin Development Plan‟s multi-stakeholder approach.

As such, in the examples of Medellin Digital and Ruta N, the framework of the development plan

on multi-stakeholder development was replicated in their mandate, giving birth to projects that

presented opportunities for the community in partnership with EPM and private companies like

HP. Also, the participative and collaborative framework has been embedded in the people‟s

mindsets through the Citizen‟s Perception Survey, giving them space to participate in the public

sphere. It is also worth noting that the framework of the Medellin Development Plan itself has

been embedded in the political system such that it has been the norm for governance and is

being continued across local government administrations.

Indeed, the road to transformation and development is a continuous one and may entail a

different mix of measures and strategies across cities and countries. As such, relative efforts and

development initiatives towards social transformation remain as a challenge to all people, a

calling to bring together the talents and strengths of people to combat the reality of injustice and

inequality. Thus far, and in the in the case of Medellin – these challenges, seem to have been

properly addressed through a holistic and collaborative union between the city‟s local government

and its citizens.

20 of 20 © 2011 Tholons

Author: Francisco Iñigo P. Garde Analyst Editor: Manuel Ravago Research Director Copyright Notice

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