New law paves way for foreign participation in country’s railway system

In preparation for the upgrading of Cuba’s railway system, regulations have been published in the Official Gazette that will enable foreign investors to participate in the operation and maintenance of all or parts of the system presently operated by Unión de Ferrocarriles de Cuba (UFC).

Decree-law 348 and accompanying regulations are, according to the Cuban Government, intended to cover every aspect of upgrading the country’s ailing railroad system, from the control of animals and people trespassing on the track, to the identification of the areas that a future operator might take charge of.

Speaking to the media about the new law, Eduardo Hernández, the Director General of the UFC and Ronald Boffill, the Director of Cuba’s Railway Transport Administration said recently that while the new regulations in the short term will not have a tangible effect on the improvement of the service, they will enable changes that have long been considered essential. This includes the classification of the system as a public and industrial service.

The officials told journalists that among the many measures the new decree-law addresses the possibility that the country’s railway system could be run by one or several operators “either foreign or Cuban” by state order, administrative concession and the approval of a license.

The new provisions require by law that all Cubans exercise greater discipline and compliance in relation to trespassing, waste disposal on railway land and safety. It provides for the relocation of individuals in properties built too close to the tracks or to critical hardware such as signalling. It also requires by law all that all railway personnel operate the system in a manner that fully considers the safety of operations and will require certification to undertake certain roles. A National Railway Safety Management Committee will also be established, and all rolling stock and systems will in future require certification.

Cuba is planning to upgrade its whole railway system by 2030. The planned upgrade would see the railway system become central to the country’s transport infrastructure and its future economic development. The planned development includes linking the country’s ports and principal cities though an upgraded east-west spine route with links and branches that will be able to carry containers, passengers rapidly and safely to ports and key cities. The upgraded system is also expected to enable visitors to access resorts from the country’s principal airports more easily. Financing, however, remains a challenge.

In recent months, Russian and French railway operators have expressed interest in participating in multiple aspects of the operation of the Cuban network, engaging ministers and officials in detailed discussions relating to financing, infrastructure and the provision of locomotives and rolling stock.

In May 2015 Russia first indicated that it might be willing to invest in upgrading and operating Cuba’s railways system and in March 2017 indicated it was considering providing €1bn (US$1.2bn) in funding (Cuba Briefing March 13, 2017). In July this year France announced that it was making available €40m (US$46.4m) for the renovation of locomotive workshops and rolling stock (Cuba Briefing July 30, 2018). China has also expressed an interest in aspects of Cuba’s railway infrastructure. In all Cuba has about 4,500 km of track and another 7,000 km dedicated to industries such as sugar. Buses remain the principal national means of transport.

The decree law and regulation are available in a PDF in Spanish at: https://oncubamagazine.com/wmag/wp-content/uploads/2018/08/GOC-2018-EX42.pdf.

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