Announcement of the Argentine Transportation Study

• • INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPl\t1ENT 1818 H STREET. N.W., WASHINGTON 25, D. C. TELEPHONE: EXECUTIVE3-6360 Bank Press Release No. 62/22 SUBJECT: Argentine Transportation Study J .1ly 2' 1962 1 A ten-year blueprint of the kind of measures that would be necessary to achieve the integrated development of railways, highways and waterways in Argen- ;,,rua. has been completed by an inter·nat'ional Transportation Planning Group and submitted to the Government. This Group was organized by the World Bank, acting as the Executing Agency for the United Nations Special ]Und. Lieut. Gen. Thomas B. Larkin, U.S.A. (Retd.) was the Technical Director of • the Planning Group, and was responsible for the day-to-day direction of its com- prehensive 15-month study. The Minister of Public 1·:orks and Services of Argentlna served as ex-officio Chairman. The u.N. Special Fund·made a grant of US$475,000 to cover part of the foreign exchange costs, the Argentint1 Government paying the remaining external costs and all local expenses. The Planning Group was composed of experts in economics, engineering and transport operations, With Arg,·~atine and foreign nationals in about equal numbers. Three private engineering firms -- Coverdale and Colpitts (U.S.A.), Netherlands EnGineering Consultents (NEDECO, Holland), and Renardet-SAUTI (Italy) -- which had earlier completed a review of the ~hort-term investment requirements of the highways and railways, assisted the st;u.dy by assigning technical experts to the Planning Group. RAILWAYS: The report emphasizes the serious and long-continued deterioration in the properties, operations and finances of the Argentine railways. The Group  - 2 - ,. ' • believes, however, that the railways rema:i.n essential; they must, therefore, be restored to efficient operation. As one importallt step toward rehabilitating the system and making it viable, the Group proposes that at least 14,ooo kilometers of' railway line -- a.lmost a third of the present system -- be abandoned. Freight ar..d passenger schedules should be reorganized, and improve\·:.,:;r.i.ts made ln roadw'ays, yards, terminals and maintenance facilities. All existing steam locomotives should be replaced by diesels, and a drastic program of modernization is proposed for rolling stock; total purchases would include 831 diesel locomotives, 33,000 freight cars and about 2,500 passenge:."' cars. The Group calls for changes in the legal status ~uu urgauization of the Argentine railways, to permit them to be operated in a manner similar to a business enterprise, to keep them free of political interference, and to ensure that they be placed under competent manage- ment. Even if these steps are carried out, the Group believes, viability can be achieved "only if this becomes a matter of national policy and only if certain d:l.fficult and unpopular policies are rigidly carried out 11 • These policies, it •• suc; 15ests, must include, beside the abandonment of uneconomic lines, increases ~n freight rates and passenger fares, and a variety of measures designed to achieve and maintain an efficient labor force. The total cost of the ra,ilway program for the ten years :}...962-71 is estimated, at 1961 values, at the equivalent of about US$1,450 million. Of this amount, about two-thirds would be in foreign exchange, most of which would be needed for the pur- chase of rolling stock. HIGHWAYS: Over the next ten years, the report estimates, passenger traffic on the roads will increase by about 115%, and truck traffic by about 100%. To • meet this demand, the Group calls for a ten-year program o:r construction, recom- struction and modernization covering over 40,000 kilometers of highways. These  ., I ~. • - 3- • proposals, which continue an already-existing program, are estimated to cost, at 1961 values, the equivalent of about US$793 million. In add.5.tion, the equivalent of US$183 million would be spent on maintenance. If the recommendations of the Group concerning abandonment of uneconomic railway lines were adopted, a further 6,665 kilometers of new highways, estimated to cost the equivalent of US$122 mil- lion, would be needed to replace these lines. The Group proposes establishment, within the National Highway Admini£tration, of separate departments for planning and investigation. Although not advocating restriction of motor carriers by any system 0f licensing, it believes that for- hire carriers should be required to observe published rates. WATERWAYS: The report makes recommendations for hydraulic studies and dredg- ing of the waterways system, which is based on the River Plate and its tributaries. It recommends replacement of much of the river fleet, which is largely "far beyond • its economic life". Because the two state-owned shipping enterprises are "ill suited to a system which would permit the best adjustments of water transport to trade requirements", the Group believes that they should be transformed gradually into a small number of medium-sized private enterprises. The smaller private owners a.re advised to combine into cooperative groups. Proposals are made for ~eform of the freight tariff structure, for overcoming labor difficulties, and for improving the equipment and administration of ports. The total cost of the water- ways program is estimated, at 1961 values, at the ~ivalent of about US$169 million. COORDINATION: The ,Group believes that a Transport Account should be estab- lishe<;l in the National BUdget to proviqe a focal point for an annual review of financf~l needs and resources, and to produce greater fiscal coordination among the various modes of tra.n:;fJpol'-t. It also calls for establishment of a permanent 4t1, planning group for transpo1"t. oooOOOooo The Report, entitled "A Long Range Transportation Plan for Argentina" and con- sisting of a main report and eight appendices, has been published in Buenos Aires by the Ministry of Public works and Services. ,,,. .,,