From the 1940s to the 1960s, a church was constructed and the first school was built. Wells were eventually dug to alleviate the water supply problems, and generators bought to supply electricity to the pumps and the few streetlights. However, there were still problems getting needed outside supplies such as sugar. These commodities only arrived when a merchant ship entered the bay to sell its wares. Sometimes, this would not happen for months. Residents got by with local products such as fish, poultry, iguanas, chicken and turtle eggs. After the Sol de Vega road to the capital of Oaxaca was constructed, this problem was alleviated somewhat.
In the 1960s, Highway 200 was built, connecting Oaxacan coastal towns with Acapulco. Surfers and other tourists began to find the quiet beaches around Puerto and tourism began to flourish. Its function as a port diminished as coffee began to be shipped by truck. Other infrastructure added included those to supply the area with potable water, a small airport where the Rinconada is now, mail service and some government offices. However, in the 1970s only about 400 people lived in Puerto.
With time, Puerto Escondido�s importance as a tourist attraction increased, with hotels and resorts being constructed. For many years, restaurants were almost exclusively in �palapas� (thatched roof shelters) with fishermen preparing their catches; however, these have mostly given way to modern tourist facilities. Currently, Puerto Escondido is one of the most important tourist sites on the Oaxacan coast.
The community of Puerto Escondido is divided between two municipalities, so politically it is two separate entities. The Zicatela Beach side belongs to the municipality of Santa Mar�a Colotepec and the western portion belongs to San Pedro Mixtepec. The boundary between the two municipalities is also in dispute, leaving many businesses in limbo, sometimes paying taxes to both municipalities
