Transportes Metropolitanos San Martin (TMS)

Cancelled

Failure

The Trainmet (now Metropolitano) consortium signed a concession contract to operate the Roca, San Martin and Belgrano South lines of the Buenos Aires Metropolitan Railway in March 1993. To prevent further deterioration of the Buenos Aires metropolitan railway network, the President had created a new state-owned corporation, FEMESA, in March 1990. It was soon prepared for privatization (via lease/concession contracts). FEMESA divided the network into 7 lines: Mitre, Sarmiento, Urquiza, Roca, San Martin, Belgrano North, and Belgrano South. The government called for bids under a 2-stage bidding process. Bids were decided on the basis of lowest subsidy required, and pre-awarded for all 7 lines in January 1993. Each concession contract is for 10 years with optional 10 year extensions. The government sets maximum tariffs and minimum service frequencies. Trainmet won the contract to operate the Roca, San Martin and Belgrano South lines. Trainmet comprises: Empresa Argentina de Construcciones, Ormas SA, Roman SA, DGT Electronica and 63 independent bus operators, along with train operators Jarts (Japan) and Bart (US) as partners. Tranmet set up the operator Transportes Metropolitanos San Martin (TMS) for the San Martin line. TMS took over operations on April 1, 1994. Since Metropolitano took over, passenger numbers have increased 31.4% on the San Martin line. The San Martin line is 55.4km. The San Martin lines receive a subsidy from the government. In November 1999, the concession contract was extended to 2025; the government also approved an increase in the consumer fees of 129% in five years, which will finance the additional US$ 120 million investments (the train fares were expected to be firstly adjusted by June 2000). By 2003, the ownership structure of Metropolitano had changed so that private Argentinian investor Sergio Taselli and Ormas were the majority owners. In June 2004, the contract was cancelled by the government. Despite plans for using an interim operator until another concession could be let, Metropolitano continued to operate the line through December 2004. The government canceled the contract due to reported failure to meet investment targets and meet safety guidelines. Jarts and Bart, originally listed as project sponsors, have been excluded as "sponsors" because they are partners for the project and because both are government affiliated. Empresa Argentina de Construcciones and Roman Maritima were removed as sponsors as the majority ownership as of 2003 comprised private Argentinian investor Sergio Taselli and Ormas. None

Transport

Argentina

World Bank Group

Project

Mass Transit, Government, Rail, Manufacturing (Industrial)