Colombia: President Santos Agrees State Will Cover Bogota Metro Shortfall
Colombian President Juan Manuel Santos on Monday wrote a cheque for $600 million to Bogota Mayor Gustavo Petro to begin the construction of the first ever metro system in the nation’s capital.
Santos expressed confidence and reaffirmed his support for the project as he provided funding to the city government, reaffirming the importance of efficient and holistic recruitment and planning. The funding will cover the additional costs involved in the redesign of the route and the comparative weakness of the peso against the dollar, which has raised costs in the past months.
Until now, Bogota, a rapidly expanding metropolitan city, has been forced to depend solely on a weathered bus system to provide transport for some 6.8 million people each day.
The Bogota metro would thus aim to alleviate the capital’s serious mobilization problems.
The initial plan was to have line that was 27 kilometers, which would have been an estimated base cost of $7 billion. However, Bogota was already forced to shorten the planned line as a coincidental depreciation of the peso increased the scheduled production cost.
Bogota’s planned 1st metro line shortened and at risk due to lack of funds
The most recent cost calculation does not include the cost overruns, unforeseen financial costs and devaluation which have blighted many of Bogota’s infrastructural projects in the recent years.
In the past, the project has suffered from a serious shortage of resources. As worries over the subway’s financing have increased, National Planning Department (DNP) director Simon Gaviria confirmed that they will conduct “value engineering” to “find savings opportunities”.
The progressive building of the subway in smaller, more manageable components has been proposed by many, including the director of the private company, ProBogota, charged with construction responsibility.
Despite the proposed $16 billion pesos budget, interest may add another $2 billion to the cost, depending on how long it takes them to finish, and moreover how long it takes to pay off loans.
Santos hopes to have the metro finished by 2018.
This article first published by ColombiaReports.com; the leading source of news and analysis of events in Colombia.