BOLIVIA's two rail networks, one in the western and Andean part of the country and the other in the eastern lowlands, formed part of Bolivian National Railways (ENFE) until being split into separate companies, initially both state-owned, towards the end of 1995. A controlling interest in each was sold and after considerable trading of shares, Andina Railway (FCA) came to be controlled by Antofagasta PLC (which owns FCAB in Chile) and Oriental Railway (FCO) by the Yulara Group, made up mainly of Bolivian investors.
The two networks have never been physically connected within Bolivia, in spite of at least five feasibility studies having been carried out over the past 50 years. Connecting them would form a reasonably direct metre-gauge rail link from Santos on Brazil's Atlantic coast to Arica, Mejillones and Antofagasta on Chile's Pacific coast. The estimated cost varied between
$US 200m and $US 1.6bn, at 2006 prices. Now, Spanish consultants are carrying out yet another study, considering a western terminus in Peru. The track in northern Chile is metre gauge, just as in Bolivia and between Bolivia and Santos, whereas all railways in Peru are standard gauge.
However, the enthusiasm for an inter-oceanic rail link across Bolivia probably outweighs its economic prospects. Soya exported to Asia from Brazil and eastern Bolivia is considered to be its principal potential traffic, but maritime distances from South American Pacific coast ports to most of Asia are greater than those from Atlantic coast ports. Moreover, Bolivian and Brazilian soya can easily access Atlantic coast ports such as Santos by railway or river barge, whereas reaching ports on the Pacific shore would involve surmounting the Andes, which rise more than 4000m above sea level, which is very costly by any transport mode.
FCO already finds it difficult to compete with road for soya traffic. Its 640km main line from Santa Cruz de la Sierra to the border with Brazil between Quijarro and Corumbá carries around 650,000 tonnes annually of soya and soya products, almost all of it being transferred to barges at Puerto Continental, close to Quijarro, for onward shipment via the Paraguay river. However, FCO's share of this market has fallen by around 25% since 2008 when paving of the parallel highway was completed. Nevertheless, rail traffic overall has held steady at around 1.3 million tonnes annually, due to an increase in soya harvests and the transport of other products, but freight rates have fallen by 12%.
In the 1970s, as part of a trade deal with Argentina, the first sections were built of a 440km line running northwest from Santa Cruz towards Trinidad, in the Amazon basin. It was never completed, and only operated as far as Río Yapacaní, 195km north of Santa Cruz. The stretch beyond Montero, at Km 56.5, where there is a cement plant, was later abandoned. Now the line to Yapacaní will be replaced and extended 148km to Bulo Bulo, at an estimated cost of $US 250m, where a fertilizer plant is being constructed by Samsung.
The construction of the new line has been contracted to Chinese companies, with the bridges being built by a Spanish consortium. It should be completed within two years and is expected to be operated by FCO. Around 20% of the fertilizer plant's planned annual output of 1 million tonnes is forecast to be consumed domestically with the rest being exported to Brazil via the border crossing at Quijarro or Argentina via the border station of Pocitos. Since the distance in each case is about 800km, the Bulo Bulo extension could entail a very significant increase in FCO's traffic volume.
FCA's equivalent to the Bulo Bulo fertilizer plant is the San Cristobal mining complex, which generates half of the tonnage transported. The complex came on stream in 2008 and exports lead and zinc concentrates through the Chilean port of Mejillones. FCA handles the traffic to the Bolivia/ Chile frontier between the stations of Abaroa and Ollagüe, from where it is handed over to FCAB.
Around 80% of the tonnage carried by both FCO and FCA comprise Bolivian exports or imports. Both companies have a same-gauge connection with Argentina's Belgrano Railway, at Pocitos/Yacuíba and Villazón/La Quiaca, respectively, but in both cases there is no through rail traffic due to the poor state of the infrastructure in Argentina. FCA also suffers from the Chilean section of the Arica to La Paz Railway being out of operation since 2005.
Finally, under the terms of their concessions, both FCO and FCA are obliged to maintain passenger services. In general, they have done more than this, improving the quality of such services in spite of confronting increased competition stemming from improvements to parallel highways. In part, these improvements are aimed at attracting tourists, while FCA has reintroduced railbus services on routes such as Viacha - Charaña to serve rural communities.
Paraguay - a railway in limbo
DURING the past 18 years, rail transport in Paraguay has slithered to a halt, with a modest chance of an even more modest revival and a lesser chance of a massive one.
The main line from the capital of Asunción to the border with Argentina, halfway along the San Roque González bridge over the Paraná river, was severed in 1995 by the rising waters behind the Yacyretá hydroelectric dam. The isolated section to the north of the new lake was left with little raison d'être, and became traffic-less in 1999 following the withdrawal of the daily suburban train, run mainly for school children, over a 44km stretch southeast from Asunción. Over some of this stretch, a tourist train ran in the 2000s, until damage to the Caballería bridge, in 2009, led to its suspension. Since then, the construction of the Ñu Guazú urban freeway has eaten into parts of the rail right-of-way.
South of the lake, activity was effectively restricted to the freight yard at the border town of Encarnación. The state-owned Railways of Paraguay (Fepasa) loaded agricultural produce, mainly soya, from lorries onto trains and marshalled them in the yard ready to be picked up every few days by a locomotive crossing from Argentina. In December 2010 this all ground to a halt due to a further rising of the lake´s water level as the Yacyretá dam was increased in height, flooding the trackbed on the Argentinian side and cutting the yard off from the locomotive depot.
The line was rebuilt along a new alignment in Argentina, thereby making possible a renewal of rail traffic. A makeshift locomotive depot was provided in the remaining segment of the freight yard at Encarnación, where, in June, four century-plus old locomotives were wooded up waiting for a new contract to be signed with soya exporters to enable the yard work to resume. However, by October this had still not happened.
In 2007 a study was carried out into the feasibility of building a new railway in land-locked Paraguay, to link with the Argentinian or, more likely, the Brazilian rail network. The prime purpose of the line would be to convey agricultural exports to a port accessible by ocean-going vessels. Paraguay is the world's fourth largest soya exporter; production is expected to reach 9.3 million tonnes this year, three quarters of which is exported. A new metre-gauge line from María Auxiliadora, in the heart of the southeastern department of Itapúa, through Presidente Franco, which is close to the Iguaçu Falls, and on into Brazil was demonstrated to be marginally economically viable, but only if potential beneficiaries contribute to the investment cost. It would be more viable today, due to an increase in soya production, which has increased by 70% since 2007.
In 2009, the governments of Brazil and Paraguay agreed provisionally that a new bridge across the Paraná river at Presidente Franco should be bimodal, but Brazil subsequently insisted that it be road only. Brazil vies with the United States for the position of the world's principal soya exporter.
Korean consultants, financed by a $US 2m grant from the Korean government, are currently studying a proposal for a 530km line partially hugging the northern bank of the Paraná river from Presidente Franco to a point in the southeastern tip of the country where the Paraná and Paraguay rivers meet. The line would cross the Paraguay river and link up with the Argentinian General Belgrano Railway near Resistencia. It has been suggested that the line be electrified, since Paraguay has a surplus of electrical energy, generated by the Yacyretá and Itaipú hydroelectric plants.
The preliminary estimate of the cost of the line in Paraguay is over $US 2bn. The line would form part of a metre-gauge inter-oceanic route, from Paranaguá on the Atlantic coast in Brazil to Mejillones on Chile´s Pacific coast. While the Korean consultants have yet to deliver their final report, it seems obvious that its beneficiaries would include Paraguay's more powerful neighbours: Argentina and Brazil. But if the latter cannot be persuaded to finance it, there seems little chance of the line being built.
Meanwhile, studies continue, this time by Italian consultants, for a modernised suburban railway over the 44km section from Asunción to Ypacaraí. Yet this appears to be thwarted by the paving over of the tracks on the exit from Asuncion's historic Central station and the Ñu Guazú freeway biting into the railway's track bed.