Calibrate & Fine Tune

ROADS

In total, Ecuador has 43,197 kilometers of road, of which 6,467 kilometers are paved. Even though air and rail have made huge improvements over the last few years, the road is still the main form of transport for many of the country’s inhabitants. The main reason it is still such a dominant force in the transportation sector is because of the reach of its network. It is able to connect 82% of the country’s population. However, while the network is extensive, large parts of it are generally unusable for any significant commercial use, and tend only to be used by private automobiles and public buses. Under the PEM, the sector aims to create a series of hierarchical hubs that will provide access to ports, airports, and other areas of public interest. As of July 2013, the Correa administration had invested $800 million in upgrading and extending the road network, with a further $5 billion earmarked for future investment. Some of this investment is aimed toward local farmers to help them transport their goods more effectively to international markets. In April 2013, the Development Bank of Latin America (CAF) signed a loan agreement with Ecuador for $75 million to partially fund the Public Investment for Road Infrastructure Program. The main focus behind the program is to promote the conservation of the road network while also making a positive impact on traffic, road quality, and safety. The program is a part of the National Development Plan, which one of its aims is to create a sustainable and improved cargo and transport network, through programs and planning, and the reduction of transport and travel costs.

RAIL

Ecuador has an old railway dating back to the 1800s that used to spread over 1,000 kilometers; however, over many years of neglect, a lack of investment, and the harsh weather conditions Ecuador experiences, by 2008 only 10% of the original track still remained. It was in this year, however, that the government embarked on a massive restoration plan with an aim to return it to its former glory. Today, the country has 966 kilometers of working track after an extensive amount of work was put into the network. The railways are state owned and mainly used for tourism, the most iconic being the Tren Crucero, or Cruise Train. Since 2008, the government has invested $280 million in this 400 kilometers of track, which connects Quito in the Andean mountains to Guayaquil on the Pacific Coast. Since the renovation, the line has boosted economic activity in many villages along the track, which were for a while, largely cut off from the outside world. As Eduardo Carrera, General Manager of Ferrocarriles del Ecuador, put it to TBY, “The communities on the train lines are the ones in charge of managing them, so we will increase their level of participation, generating job opportunities with as many as 5,200 direct employment positions and around 16,000 indirect ones, as well as providing economic alternatives to these communities.”

While the current rail network is largely used for tourism purposes, the government is investigating the possibility of increasing its role as a freight carrier. In December 2013, Ecuador’s National Pre-investment Institute (INP) commissioned Barcelona’s metro operator, TMB, to carry out a feasibility study for the construction of an electrified rail network connecting key mining centers with the country’s ports on the Pacific Coast. The 10-month study will look into the viability of connecting the mines in the southeastern part of Ecuador with Puerto Bolivar. In addition to this, the study will also consider the possibility of installing a passenger line from Quito to Guayaquil; however, unlike the Tren Crucero this will be aimed at the high-speed transfer of passengers between the two cities, unlike the four-day journey taken by the Cruise Train. The TMB will look to find the best economic, technological, financial, and environmental options for the project and deliver its results toward the end of 2014.

While the TMB looks into the country’s national network, Metro de Madrid was selected to carry out technical studies to build the Metro de Quito. Plans to build a metro system in Quito were first drawn up in 2009 and the design was completed in 2012. In January 2013, construction began on the $1.68 billion Line 1 that will run from Quitumbe bus station in the south of the City to Mariscal Sucre Airport in the north. The line will have 15 stations and it will take 34 minutes to complete the 22-kilometer trek. Plans for three additional lines are being considered; however, work is unlikely to begin before the completion of the first line in 2017. It is expected that by 2030 the metro system will handle 500,000 daily commuters, up from an initial expected demand of 378,000 daily commuters in 2017.

AIR

One of the biggest projects in recent times for Ecuador has been the construction of its new international airport in Quito. The $700 million Quito International Airport was officially opened to commercial traffic in February 2013. The airport boosts the longest runway in Latin America at 4,100 meters, some of the most sophisticated air-traffic control technology around, and 38,000 sqm of terminal space with an annual capacity of 5 million passengers. The airport also includes an additional 34,000 sqm of additional buildings, which include the control tower, cargo space, hangers, catering, and ancillary aviation services. Now that the country has the infrastructure, it is looking to increase its connectivity. According to Paola Carvajal, Minister of Transport and Public Works, “In accordance with the investments that have been made, the Ministry is updating the Air Services Agreements with our sister nations in order to improve international air travel connectivity and attract a wider network of transport services to benefit passengers and improve our export capacity.”

PORTS

Being so close to the Panama Canal and having such a large coastal stretch, Ecuador’s ports have always been important for imports and exports. The main ports in the country are Esmeraldas, Bolivar, Guayaquil, and Manta, which are all state owned. According to the World Bank, TEU traffic is increasing in Ecuador, up from a little over 1 million in 2009 to 1.12 million in 2012. This increase is somewhat different to Ecuador’s neighbors, which mainly saw decreases in port activity, with Colombia falling 6.9%, Venezuela 8.2%, and Panama 4.1% in 2013 compared to 2012.

The government wishes to continue this growth, and has decided that certain reforms will be the best way to achieve this. One of the main changes will be the abolishment of the four separate port authorities managing the ports, with the Ministry of Transport and Public Works taking over control. By doing this, the government hopes it will be able to specialize each port and have them cooperate to create a more efficient and effective import and export system. “The government aims to boost maritime and port activities to develop the production matrix and open new business channels. Ecuador’s ports will play a major role in the national effort to change its trade balance, positioning the country as one of the main regional ports,” Rocí­o del Pilar Proaño Villareal, Sub-secretary of Ports and Maritime Transport, explained in an interview with TBY.