Kaohsiung government may take over management of city's metro
The China Post news staffTAIPEI, Taiwan -- The Kaohsiung City Government is assessing the possibility of taking over the management of the city's money-losing metro system, a report said yesterday.
January 3, 2013, 12:02 am TWN
The Kaohsiung Rapid Transit Company (KRTC) will see its assets turn negative in April and the city government is expected to take over the railway system around that time, the Central News Agency said.
Wu Chia-chang, secretary-general of the Kaohsiung bureau overseeing the rail system, said the government is assessing ways to prevent the KRT from becoming a burden for the city coffers.
The KRT, a build-operate-transfer (BOT) project, has been losing money since it started services in 2008. The KRTC estimates that it will break even when daily passenger volume reaches 170,000.
Last year, daily passenger volume reached 154,300, and this year it is expected to rise to 163,000, said company President Chang Hsiu-chi. He added that the critical volume of 170,000 may be achieved in two to three years.
Chang said the value of the company's assets was estimated at NT$29.9 billion in June 2011. He said the operation of the KRT will be sustainable if it can be relieved of its amortization and interest burden.
The city government said it will have the company's assets evaluated and seek to revise the BOT contract before the KRT assets turn negative.