CAF Approved USD 45 Million to Revamp Uruguay Railway
The main objective of the project is to restore the use of railways for freight transport
CAF—development bank of Latin America—granted a $45-million loan to Servicios Logísticos Ferroviarios, a private limited company composed of the state-owned railways administration entity (AFE) and the National Development Corporation (CND).
The new railway operator shall be responsible for implementing a project to restore the use of the railway for freight transport, invest in the purchase of rolling stock and develop an overhaul plan for locomotives and wagons, incorporate technologies for planning and control, among other activities. In addition, it shall allocate part of the loan for the refurbishment of workshops, local offices and railway stations, while developing an institutional strengthening plan.
CAF Director-Representative in Uruguay, Gladis Genua, said “the restoration of the railway system in Uruguay is essential to underpin the logistical growth of our nation. We understand that we must work together to help create an infrastructure network that considers the use of freight trains in addition to other modes of transport of goods. This is the first step in the development of an operational model that seeks to improve the efficiency of the freight service, in order to boost competitiveness of domestic products and the efficiency of Uruguay as a logistics hub.”
In addition to CAF’s loan, a local counterpart fund of $11.5 million is planned for the project, which will be implemented gradually over the next two years.
Carmen Melo, President of Servicios Logísticos Ferroviarios said: “This loan is a proof of our ability as an operator according to the business plan, and gives us the challenge of implementing it. We are in the preparatory tasks, such as the overhaul of locomotives and wagons. Now we will accelerate deployment. We believe it is an important step in the development of the national logistics system in addition to the ongoing infrastructure improvement works, amounting to USD 300 million.”
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