Ministry to spend LE 3 billion to upgrade signaling system
CAIRO: The Ministry of Transportation (MoT) will spend LE 3 billion in the next 24 months to upgrade the railway system’s signaling system, including the incorporation of GPS technology, Minister Mohamed Mansour said late Tuesday in unveiling the broad lines of the ministry’s plan to modernize the 100-plus year old railroads.
The ministry is now negotiating the purchasing of new locomotives to replace the Railway Authority’s (RA) aging fleet of 350 operational engines and is upgrading 8 stations. Mansour said renovation will touch 80 stations per year beginning next year.
“We are by no means where we want to be, Mansour said. “This is a complete reorganization of the railroads.
Speaking to local and foreign businesses at a British-Egyptian Business Association dinner, Mansour appealed for more private sector participation using public-private partnerships to upgrade the railroads. The ministry has already secured LE 5 billion in funding from the government for upgrades, following the August Qalyub train crash which killed 58 and injured 144.
The crash, initially blamed on the drivers, was later determined to have been a result of failure in the signaling system, according to government investigators.
Mansour said a portion of the funds will be used to raise employee salaries, but did not specify the amount. Train operators earn about LE 300 in basic salary, on average, he said.
RA now faces the challenge of raising revenue and cutting down its LE 3.5 billion in debt. Last September, the authority raised first-class ticket prices by 15 percent. Mansour said further rate hikes are possible, but the authority will now work to generate income through increasing cargo transportation and selling advertising space in its renovated stations.
Although railways transport 12 million tons of cargo annually, they represent just 5 percent of total cargo transportation. Nearly 95 percent of cargo is transported via the road network, according to MoT figures.
RA has recorded losses of more than LE 1.5 billion since 2002, a figure Mansour said his plan will eliminate in the next three years.
MoT is now negotiating the purchase of 40 General Electric locomotives after ordering 40 last month using a $120 million (LE 684 million) grant from the Qatari government. Mansour is due to discuss the full details of the ministry’s railways development plan with the PA’s Transportation Committee March 18.