Kaohsiung Rapid Transit Corp (KRTC) yesterday rebutted media speculation that the company would be forced to suspend operations due to financial problems.
The company issued a press release saying it has been discussing loan restructuring with the Kaohsiung City Government since last year, in the hope of gaining financial support from banks similar to that offered to Taiwan High Speed Rail Corp.
KRTC has capital of NT$10.2 billion (US$320.8 million) and is facing a NT$5.1 billion deficit as of this month, the company said.
“Metro systems around the world have all faced difficulties in the initial stage of operation, during which time they all depended on the government for help,” the KRTC said.
The company said it is fully confident of the future of the Kaohsiung Rapid Transit system, adding that the company and the city government have taken measures to boost passenger volume on its two Mass Rapid Transit (MRT) lines.
For example, the company said, the daily transportation volume last month had grown by about 15 percent compared with the data for the same period last year.
The Chinese-language United Daily News and China Times yesterday quoted a to-be-released Control Yuan investigation report as saying that operation of the two MRT lines might be suspended at any time for financial difficulty if the company does not take action to ensure the MRT system’s sustainability.
The stories claimed the unpublicized report stated that the company’s deficit rose to NT$2.2 billion nine months after the Red Line was launched, adding that the company’s debt is growing at a rate of NT$200 million per month.
The KRTC inaugurated the city’s first MRT line in March 2008 and the second line in September that year, but has had difficulty attracting Kaohsiung residents to use the MRT subway system and MRT shuttle buses.
The company’s finance has been in the spotlight over the past two years, with some even speculating in March that the company might declare bankruptcy in June.
According to the KRTC, the two lines have a daily passenger volume of 130,000 people, which cannot cover the MRT system’s daily operating costs.
Kaohsiung Mayor Chen Chu (陳菊) yesterday assured the public that MRT operations would continue.
Chen said the MRT lines fulfill Kaohsiung residents’ basic transportation needs, adding that the city government has been helping the KRTC persuade the central government to build a tighter MRT network in Kaohsiung.
Chou Teh-li (周德利), deputy director of the city’s Mass Rapid Transit Bureau, added a tighter network would certainly help boost the KRTC system’s passenger volume.
Chou said the city government proposed in 2001 plans to extend the current lines to Kaohsiung County’s Gangshan and Lujhu, but the central government had yet to approve the plans.
The city government also plans to build two more lines and a waterfront light rail system, he added.
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