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World Bank Document rETURN TO' RESTRICTED tRkETU-RN TO b .- ' r%r -L f C-l %ANN A #% I-=rUn' ''mi-i flL ,,DVI1A VV -I31 WA!TrHlN WIVo!.5 ONE W"EE . This report was prepared for use within the Bank and its affiliated organizations. I Public Disclosure Authorized They do not accept responsibility for its accuracy or completeness. The report may not be pubiished nor mOy it be quoted as representing their views. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION Public Disclosure Authorized AN APPRAISAL OF THE DEVELOPMENT PROG.RAM ,L xIVLrl.. I..- VOLUME V ANNEX IV - TRANSPORTATTIN Public Disclosure Authorized IP%AR T I ' Road and Rail The Railway Program Railway Revenues and Accounts PART II Roads and Road Transport Ports and Merchant Shipping Airports and Civil Aviation ! 'Al3 1A A6 Public Disclosure Authorized Department of Operations Western Hemisphere CURRENCY EQUIVALENTS U.S. $1 = 12.49 pesos 1 peso (Mex$) = U . S. $. 08 1 million pesos = U.S. $80, 000 rlAT3 1 1'T 1 E! 7rAT1_._ AXNNE1X E !'J Part I Page TR.MkSPRTOATL)N ........... ........................................ l Road and Rail ............................................... 3 The MHajor Traffic Patterns ........................... 6 Spheres of Operation .............................. 8 Public Policy and the Railwzays ..... ........... 14 The Railway Program .......................................... 16 Recommended Investment Program, 1963-65 ........ o....... 19 Freight Traffic Trends ................................. 21 Passe7rger Traffic ........................ 27 Locomotive and Rolling Stock Requirements ........ o.o. 29 Proo,ram of F.C. Nacionales de Mexico ................... 38 Program for Ferrocatrril del Pacifico ............. ...... 44 F.C. Del Sureste and F.C. Unidlos de Yucatan . ... 48 F.C. Sonora-Baja California ............. 0 0 *. 49 F.C. Chihuahua al Pacifico . ......... $0...........50 F.C. Coahuila y Zacatecas ............ 52 Nel;w Construction Projects . ................... 52 Investment Planning .. .................. 54 Foreign Exchlange Component of the Pro-ram .............. 55 Railway Revenues and Accounts ............................... 56 Analysis of Railway Deficits ........... .. .............. 60 The Railway Cost Structure .# ......................... 63 Passenger Rates and Revenues ........... .. .............. 66 Freight Rates an3d Revenaes ............................. 75 Viabilitv of Light Trafficked Lines . ................... 83 Labor Costs and Social Services .......... .. ............ 87 Normalization of Social Service Costs ......... ......... 91 Compensation for Carr-ying :"iail ......................... 92 Deoreciation of Fixed Assets and Interest Charges ...... 93 Interest Charges ......... .............................. 94 Railway V-i2hilitv on a Normalized Basliq ................ 95 iNorraalized Position of the Nacionales de M'lexico ........ 98 M!orruqli,7p Posi1ition of t'h FPrrror>rri1 di1 Pnnifin. 10n Positions of the Other Railways ..... 103 APP\1DITY', .I TA.9:ES, PageEag Tabl]e 1. Geographical Distributio of Various LconolULic Indicators .................. - ......... 106 Table 2. T-a4ngs and Tl'loi o ,ain Foodtuffs bIy Rtail and iegions, 1959 . ......... 107 Table 3. 141Ct-all and M`14ineral E.portusby Point of Export, 196i 10U Table 4. Freight Ton-Kilometers by Railway, 1952-61 ............ 109 Table 5. Averac Lengthlg ofl Taul by -ailways, .... ....... i Table 6. Tonnages of Full and Less Ihan Car Load Commercial Traffte by Rail-wa,r:s 952 and 1961 ............ iii Table 7. Tonnage Moved on Mexico's Railways - Total Product Gro-ups and Selected Commodities .. .. Table 8. Composition of Railway Traffic by Main Groups and Commodities (Full Car Loads) . 113 Table 9a Passenger Traffic Statistics, 1961 .. 114 Table 10. Past and Projected Passen.er and Revenue Freight ron-Kilometer (Chart) ............. 115 Table 11. Locomotive Requirements for the F.C. Nacionales de Mexico, 1965 .............. *. 116 Table 12. Comparison of Railway Idork Done per Sian Emaployed ..... 117 Table 13. Proposed and Recommended Investment Program, 1963-65 Nacionales de Mexico O.......*...o.............. 118 Table 14. Proposed and Recommended Investm.ent Program, 1963-65 Del Pacifico ..................... 119 Tab:Le 15. Proposed and Recommended Investrnent Program, 1963-65 Sonora-Baja California.120 Table 16. Proposed and aeconmmen-led Investrennt Program, 1963-65 (Inidos de Yucatan ................. ..a 121 Table 17. Proposed and Recommended Investment Program, 1963-65 Chihuahua al Pacifico .. 122 Table 18. Proposed and Recommended Investment Program, 1963-65 Coahuila y Zacatecas .123 Table 19. Propnosed and Recommended Investment Program, 1963-65 Del Sureste *......aa** o*o*a......**.*.**. .* 1211. Table 20. Proposed and Recommended Investment Progrmn for New Railway Construction, 1963-65 .. 125 Table 21. Breakdown of Recommended lnvestment Prog ram by Nlain Items by Railways .. 126 Table 22. Operating Results F.C. i\lacionales de liexico .* ....... > 127' Table 23.- Operating .Results F.C. Del Pacifico ................... 12L Table 24. Operating Results F.C. Sonora-Baia California .12r' Table 25. Operating Results F.C. Del Sureste ..................... 13C) Table 26. Operating Pesults F.C. Unidos de Yucatan ..... .. 13]. Table 27. Operating Results F.C. Chihuahua al Pacifico ...... 132. A'Dfl1I?TfTV rVAtnTVQ OC)TmTrhT fl, , M-1- -cr.r_Cl - A -- A TT- - 1 -; -. 4 rf- 4-4 V -- ...............................14-- -nK- /_r .LIZULJJ> 4,t . I'; UJII110LC|L_L-41 CLIA W i. l _ W VW. - a UA16 Ott Q -1. U.L _Jl7w F.C. Nacionales de Iexico 133 able 297. IiMUId..alizd adL UrIU V±izd.±U tCLULLIn, I sulLLs, 196L7U 5) All Government Railways ...... ....................... 1314. Table 30. Cost of Transporting Goods on the F .C. ,NacLor1ales de Mexico, 1961 ........ ............................. 135-6-7 irHp S Railways of Mexico - i902 ......................... 17a Freight Traffic Flow (F.C. Nacionales de Mexico Railways) ... ...... 85 CHART Costs and Revenues - 1961 (F.C. Nacionales de Mexico) .... ......... 68 A N M E X l; TPAIN SPOKLATION 1. Both in the immediate past and in the recommended program for 1963--65 railwray investments account for about half of all public investments in transportation, highways for about 40 percent, and ports and airports for the small remainder. With such a predominant portion of investment going into rail and road, the -mission paid particular attention to these programs. Before forming a judgment as to the appropriateness of the planned levels of investment in roads and railwrays, the mission sought first to examine the present and expected future roles of each mode. For example, the mis- sion has tried to assess whether the rapid growth in trucking has made part of the rail system or the services provided redundant. It has tried to answer such prior questions as: Are truckers able to compete because they are not paying the full share of the cost of highways'; "What are the reasons for the large and growing financial deficits on the railways? Are they a consequence of inefficiency or institutional limitations whichi reflect transport policy?' Should the program for the railroads be de- signed to run them down slowly if they are high-cost carriers rather than modernize and rehabilitate them?" Has the Government's inland transport policy, if any, resulted in a gross mis-allocation of resources or has it provided a catisfactory transport system which meets the needs of the economy?' 2. Within the limits of time and information available, the mission sb,r]j i the exi .-in and nrosnpet.1ve Ernrfir flows in Mexicoj the real costs of transport by road and rail, the structure of transport user charges, and the appropriateness of the nlanned rail and road investments to meet the growing and dynamic demand conditions for road and rail trans- nort facilltles. The broad conclusion of the mission is that. an invest- ment program for 1963-65 considerably larger than the level of expenditures 1r recent. years ls well usii.1fiedc boh±I f'or 1ailoasI andi h ghways 3. i7lexico has a w.el1-es_t.abll shed rail a 'ndoat_ra ot net.wrk-.L Br the first World War foreign private capital had already developed the main lines of the road system which wer-e subsequntly bought by the Govern- ment. The system has been expanded with the construction by the Government of the Snora-Baja Galifornia line, the 3reste line, nd, M-ost recently, the extension to the Chihuahua-Pacifico Railroad. The basic network, how- ever, is sil the old one, -r,os-Po ,uf . J¾is now -nder the a., ,n-is+rat ic of two semi--autonomous government corporations--the National Railways of 1-1eK.Lo, C6iLA Llll ~I W-~L.LL. iCL-LLi. VCL%± * iiI -' UVWU OJ'YIJUVIJI, VVII41-1 J1,U6U LU1 Upj-O± ate 81 percent of the total present route-kilometers, accounted for over 79 percentl ofiall freiLght andu passenger01i trafi-LIn 19dL0±. Tl,e UUAlk Uofrecent railroad in,ist-ment 1has been1 usAd for the reh'abilitation and"Mode1r- ,at of these two systems. The recommended 1963-1965 railroad investment pro- gram would thistntnue rehabilitation a-d modern4zation process. .4. highwa~ys-ysteIIL wu±uin by- c A 'A of moure recetui LLdLate, '4.~~m 14 has been rapidly expanded and improved. Between 1955-62 the highway network increased from 25,600 msRs. to 460,700 Kms. ine recommended 1963- 65 program would be a continuation of the still unfinished process of Ihighway deVelopment. Tne main elements oI the program are (a) the fill- ing of some existing major gaps in the main
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