Costa Rica

Costa Rica’s electric train 'more political than a public transport solution'

Bnamericas Published: Wednesday, May 26, 2021
Costa Rica’s electric train 'more political than a public transport solution'

Costa Rica’s US$1.55bn electric train project has finally reached the tendering stage with President Carlos Alvarado determined to leave his successor with concrete proposals.

A number of the country’s infrastructure projects have been delayed until after the February 2022 election. 

“This progress is part of our responsibility to continue with the development of the various stages and procedures that are needed to prepare the final tender that a project of this importance deserves," said state-owned rail authority Incofer’s CEO Elizabeth Briceño.

The interurban light rail link will play a paramount role in the development of the greater metropolitan area of capital San José. Current plans are for the line to provide the east-west backbone of public transport in the city.

As part of Alvarado’s 2020-50 decarbonization plan, the electric train fulfills mandates to reduce traffic congestion, lower traveling times and limit hydrocarbon emissions.

It has not been plain sailing for the project, however, as the national assembly has argued about the cost versus potential savings that the train would provide.

Costa Rica’s indebtedness, at 67.5% of GDP in 2020, according to Fitch Ratings, has risen as far as to 80% with some experts suggesting it could hit 90% in 2021. 

“This year the debt will be US$40bn, this year financing that US$10.5bn [financial hole] we will add another 10 points [to the debt] so we would be at 80%,” former general manager of financial group BAC, Gerardo Corrales, told BNamericas.

Several other factors were raised by the college of engineers and architects (CFIA). They took issue with the lack of multimodal support and an absence of information on design and financial models.

CFIA cast doubt on the expropriation required and ability for the current bridges to carry the estimated 200,000 passengers a day.

This followed feasibility studies carried out by Spanish firm IDOM and financed by IDB.

IDB’s role in the project also includes attempts to lower costs and analysis of integrated public transport models.

“I think the relationship between cost and price will be quite high because we’re talking about a very modern train and being electric makes it more innovative,” university professor and economist Daniel Suchar told BNamericas.

Suchar also pointed out that the project was one from Alvarado’s election campaign in 2018. 

The Central American Bank for Economic Integration (Cabei) has loaned Costa Rica US$550mn for the project. The rest will come from the company that wins the tender.

However, that company will receive a US$50-150mn a year subsidy from the state. This has caused further political complications with the general election due next year.

Whichever company wins the tender will receive a 35-year concession to build 84km of rail on five lines – Paraíso-Atlántico, Atlántico-Alajuela, Atlántico-Ciruelas, Alajuela-Ciruelas and Ciruelas-El Coyol – using Incofer’s infrastructure.

The system will have 47 stations, of which at least 10 will be multimodal and will connect the cantons of Alajuela, Cartago, Heredia and San José.

“It won’t be built in the short term. It has a lot of enemies and antagonists in Costa Rica and it has become something more political than a public transport solution. That’s why they’re running to push the tender but it won’t be built that quickly,” Suchar said.

According to Briceño, the project will create at least 1,000 temporary positions and 461 permanent jobs. 

Current plans involve the project starting with line No. 2 from Atlántico to Juan Santamaría airport, a 21.6km stretch with 15 stations. The second phase would be line No. 1 from Paraíso to San José. The third and final phase would include lines 3, 4 and 5.

Interested international entities will have 10 days to review the documents on Incofer’s website prior to the bidding process opening. 

A public meeting has been called for June 9 to discuss the project at Incofer’s headquarters, as published in the official gazette.

Photo: Costa Rica government

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