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Argentina to Nationalize Cargo and Passenger Trains

By Sabrina Hummel | The Argentina Independent | June 4, 2013

Minister of the Interior and Transport, Florencio Randazzo, is set to announce changes in the railway sector – most importantly the nationalisation of passenger and cargo trains.

The Brazilian company América Latina Logística (A.L.L) will see its concession revoked and the historic Tren de la Costa will return to state hands. A.L.L had already received a warning from the Auditor General’s Office for anomalies in its provision of services.

From 1990 up to 2012, the company amassed a debt of over $237m to the government, 866% in excess of its contract compliance. Payments over the last six months have stalled, allowing the government to rescind its concession.

Tren de la Costa, built at the end of the 20th century, served as a vital link between the neighbourhood of Belgrano and the port of Tigre. Following various changes in ownership, it converted to electric power in 1931.

It covers 15.5km and runs alongside the scenic Río de la Plata serving four provincial municipalities. It has a total of 11 stations with a standard fare of just $16m or $10 for those with a DNI.

A.L.L meanwhile operates two of the most important freight railway networks in all of the country: A.L.L Central (line San Martín) and A.L.L Mesopotámica (line Urquiza). A.L.L Central runs through the centre of Argentina, beginning in the province of Cuyo and passes through San Luis, Córdoba, Rosario, Santa Fe, and finally Buenos Aires. A.L.L Mesopotámica in turn runs through the provinces of Misiones, Corrientes, and Entre Ríos, linking them to Paraguay, Uruguay, and its own network in Brazil.

A.L.L is the largest operator of rail logistics in Latin America. A.L.L Argentina is the biggest rail operator in the country, spanning 8000km. It is also the second largest in terms of cargo volume, transporting more than 5m tonnes each year.

Randazzo was recently quoted saying, “in terms of policy and management decisions, the State is more competitive than the private sector”.

June 4, 2013 - Posted by | Economics | , , ,

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