BOTSWANA ENDS PASSENGER SERVICE
Posted on 05 March 2009 by Railways Africa Editor
The government of Botswana has announced that passenger train service in the country is to be terminated on 1 April 2009. The main reason advanced by minister of works, transport and communications Johnny Swartz in parliament is an escalating operating loss on rail operations which increased from P10 million ($US1.2m) to P78 million ($9.4m) in the past year.
A more serious aspect explained by ministry of works and transport deputy permanent secretary Lewis Malikongwa at a Botswana Railways (BR) press briefing in Gaborone is the condition of the rolling stock which has not been overhauled in 15 years and consequently poses a threat to passenger safety.
The announcement has been received with general dismay as train fares are currently much lower than those charged by road transport – but this of course is an important contributory factor to the working loss. But it is doubtful whether many of the low-income earners who patronise the train could afford to do so if fare levels were to rise to economic levels.
In October 2006, BR “indefinitely suspended” its daytime passenger train service and now the overnight train is to be stopped too. The passenger coaches are to be sold to raise funds as part of a strategy to re-finance BR “which needs recapitalisation of close to P600 million.”
The minister said BR’s costs of passenger services in 2005-2006 were P38.8 million, while revenues were only P9.1 million resulting in a net loss of P29.7 million. He said a total investment of P586.5 million ($70m) will be required to overcome BR’s shortage of locomotives and rolling stock to meet current demand for freight traffic. He said this will be financed by converting P104 million outstanding loans from government into equity, disposing off locomotive and rolling stock assets that are no longer useful, the use of BR reserves and guaranteed borrowing, on the basis of a debt-equity ratio of 0.6:1.
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