The train in Uruguay is about to be revived as a relevant logistic actor after gradual disuse that led it to ostracism for years.
Railways have a history of more than 150 years in the eastern territory and marked the country’s development at the end of the 19th century, with the help of the English capital.
Now, together with new foreign investment and through a work of more than US$1 billion, a new stage will begin, which was not without controversy.
It will be a scene not seen in Montevideo for decades, with railroad crossings impacting the regular flow of traffic in the Uruguayan capital.
Thus, beyond the economic benefit of the cargo that this new logistics corridor will be able to move, the passage of the train through various urban areas will affect daily life, a factor that the national government and the municipalities seek to mitigate.
As Transport Minister José Luis Falero said on Carve radio on Monday, the Executive Power and the Municipality of Montevideo have just agreed on a package of additional works to mitigate the effects of the train entering the city from the west zone to the port.
The package of works will include two new tunnels at strategic points in Montevideo so that automobile traffic can flow under the roadway over which the train will pass, said Luis Oreggioni, director of Planning of the Municipality of Montevideo, in an interview with Bloomberg Línea.
The two tunnels will be one in the area of Paso Molino, a commercial point in Montevideo, and the other at the intersection of the track with Boulevard Aparicio Saravia, a logistics corridor for different products.
“It was detected that in those areas, there were flows that were going to have a significant distortion that deserved to be changed, and therefore they should stop being level crossings and become overpasses,” the director explained.
There will also be related works in these and other areas in the west of the city. The additions follow a “readjustment” of the impact study, which determined, among other things, a longer time than initially planned for the barriers to remain down.
The Ministry of Transportation committed US$45 million for these works, Falero said Monday on the program Así Nos Va.
THE ECONOMIC IMPACT
The plant that the Finnish UPM will set up in Pueblo Centenario, in central Uruguay, will take its production of 2.1 million tons per year through the Port of Montevideo.
For that, the government of Tabaré Vázquez (2015-2020) committed to the construction of a 273-kilometer railroad linking Durazno with the capital, which was part of an agreement questioned by part of the opposition at the time, now in government.
There will be at least 14 daily frequencies for the pulp mill, while the tracks will be available for other sectors of activity, but, above all, for the country’s agro-industrial engine. A total of 45 trips will be available, of which 18 will be for passengers (nine outbound and nine return).
The start-up of the company’s second plant in Uruguay -the other one is the former Botnia plant in Fray Bentos- was scheduled for the first quarter of 2023, and the start-up of the train around May.
What impact will the revival of the train have on the Uruguayan economy? How will the development of the infrastructure coexist in the metropolitan areas that had already forgotten the passage of the train tracks?
UPM will demand around 50% of the annual trainload, so the other half will be available up to 4.5 million tons per year. When the company presented the investment, it stated that it would contribute 2% annually to the country’s GDP.
The Vía Central consortium, formed by Uruguayan, French, and Spanish capital, invested US$1.07 billion in the train project. The State, for its part, will pay for it for 15 years through an annual fee of US$150 million, including maintenance, totaling US$2.25 billion.
Bloomberg Línea tried unsuccessfully to contact the Minister of Transportation for this article. Falero said on the radio that the government was looking to reach more cargo to pay for the work.
“We are looking to interconnect the coast with the central rail network and thus be able to cover the availability in the network, because UPM would occupy 40% of the daily load, and we need to incorporate more.
“For two reasons: we have to pay for the work. I need more trains running on that track so that with the toll we can cover part of the indebtedness generated by this work”, he said.
The Finnish company’s direct investment for the plant assembly was announced at US$2.7 million, plus another US$300 thousand foreseen in a port terminal in Montevideo.
The works at the plant, as with the train, have also been an employment generator for the Uruguayan economy in recent years. It presents the government with the additional challenge of maintaining activity levels once the most labor-intensive stage of the project is completed.
The condition of the contracts for the integral development of the investment was a point that the current president Luis Lacalle Pou questioned when he was an opposition senator.
Once in government, he promoted a renegotiation of some aspects, which resulted in an announcement in May 2020. A joint statement assured that the company would assume US$60 million in road works and an additional US$68 million in electricity infrastructure.
MITIGATING THE DAY-TO-DAY IMPACT
“Our mission is to make the railroad coexist with the city,” began Oreggioni, director of Planning at the Montevideo City Hall, an administration governed by the former industry minister Carolina Cosse.
As part of the plan, the Ministry of Transport and the city defined new works following an updated study of the impact of the railroad on the city’s mobility. It involved a more precise definition of the maximum train circulation speeds, safety patterns to avoid accidents, the estimated number of frequencies, and the time the barriers should remain low while the convoy passes.
“The low barrier time grew and in some cases doubled to what was planned,” said the departmental director. The wait could be up to four minutes, according to forecasts. In Montevideo, there will be 41 level crossings, each with a modeled waiting time. “A new problematic factor appeared, and we have to take care of it,” the architect completed.
The works for the extension of the low barrier time will have the two new tunnels as their most relevant infrastructures, but there will also be other works. The work package will be divided into zones: Colón, Sayago, Paso Molino and Capurro.
Each represents the main centralities the train passes through on its way into the city. There will be pedestrian elevators in different areas, street widening, and new traffic lights, among other interventions.
The Municipality has also promoted an urban park next to the tracks, but this has not yet been defined because it has yet to be financed.
Meanwhile, the passenger frequencies promote, according to the government of Montevideo, “a potential for metropolitan integration”. In addition to the transfer to satellite localities of the capital, it also opens the door to intermodal connections.
One of the main hubs is expected to be at Bulevar Artigas Station, a point in Montevideo through which departmental bus frequencies go to the coast, the center, and the north of the country.
THE HISTORY OF THE TRAIN IN URUGUAY
Uruguay has 1,174 kilometers of an active rail network and 1,553 kilometers of an inactive network, according to a public statement dated 2020 and disseminated on the website of the State Railway Administration.
In addition, 273 kilometers are under construction. Most of them were built between the end of the 19th century and the beginning of the 20th century by private English companies.
However, in 1949 they became state property, and in 1952, AFE was created, the entity that received 2,950 kilometers of tracks for its administration.
In an interview with Bloomberg Línea, historian Ana Ribeiro, also currently Undersecretary of the Ministry of Education and Culture, narrated the vicissitudes of the train in Uruguay.
The train was born for commercial reasons, driven by English capital, “and it had a great economic impact,” she said. “It is enough to look at the layout of the original lines. It is a hand where the epicenter is the Central Station, located next to the Port of Montevideo,” she illustrated.
The first investments began in the 1860s and then expanded in the 1870s. “English capital also invested in other things essential to accompany an extractive system of raw materials, such as running water and the telegraph,” the researcher and teacher added.
Later, the meat processing industry was also added, and at the same time, wire fences began to be extended in the countryside as an instrument to secure private property. The expansion was such that even political candidates at the beginning of the 20th century used the train for their campaigns and held events at each station.
Once the railroad was in the hands of the State, the entity then underwent several management restructurings but never managed to take off. “As it is very difficult to suppress a transportation and raw material service, it was left agonizingly because the people defended it until we reached what we have today,” Ribeiro said.
LESS AND LESS CARGO
Currently, the maximum speed for freight trains is 40 kilometers per hour, while the new tracks installed in the so-called Central Railway will support up to 80 kilometers per hour. AFE’s historical load is around 1.4 million tons, said former AFE president Miguel Vaczy in an interview with El Observador in 2021, but it has been half that figure or less in recent years.
AFE’s former director for the National Party, Alfonso Lerete, stated that the state-owned private law operator Servicios Logísticos Ferroviarios (Self) lost eight of its ten clients from 2015 to 2019, including two timber companies, a barley industry company, and another rice company.
“Those companies are going to the truck. Why? Because of defaults. There were several derailment problems. The problem was cases that went out but did not reach their destination (the port) because of a derailment of the convoy. There you not only lose cargo, but you also lose the shipment”, explained the current congressman, who in the previous period represented the opposition in the management of the railroad entity.
Currently, of the active tracks, the operating line runs from Montevideo to Minas. Meanwhile, the Montevideo-Río Branco and Paso de Los Toros Rivera lines have no cargo. Once the Central Railway project is completed, the entire axis of the territory from the capital to the Brazilian border is expected to be operational.
With information from Bloomberg