Inter-Provincial bus transport “unsustainable”

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Inter-Provincial bus transport “unsustainable”

7:13 CAT | 28 Oct 2016

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Mozambican companies providing inter-provincial bus services claim that their business has become “unsustainable”, according to a report in Friday’s issue of the independent newssheet “Mediafax”.

The factors that have combined to make long distance transport unprofitable and dangerous include the insurrection waged by the Renamo rebels in the centre of the country. The Renamo gunmen have targeted vehicles using the main roads, particularly buses, even when they are travelling under armed escort.

Other serious blows to the business were the rise in fuel prices decreed by the government at the end of September (a 24.5 per cent rise for diesel and 5.3 per cent for petrol), and the repeated rises in interest rates ordered by the Bank of Mozambique. The main reference rate of the central bank is now 23.25 per cent, and in response the commercial banks also hike their own rates.

Interviewed by “Mediafax”, Castigo Nhamane, the chairperson of the Mozambican Federation of Road Transport Operators (FEMATRO), said that those businessmen who continued to run long distance buses did so out of love for their profession, and not because they were making any profit. In this business, profits had virtually ceased to exist, he claimed.

“Well before the fuel prices roses, interprovincial transport was being shaken by the politico-military tension in the centre and north of the country”, said Nhamane, “particularly along the main north-south highway (EN1), where the attacks are constant”.

He said his association had just received a dispatch from the Transport Ministry authorising bus companies to increase their fares for inter-district and inter-provincial journeys, in order to compensate for the fuel price rise. But even so, the business remains unsustainable, Nhamane declared.

Many transport companies have borrowed money from the banks, and now the continual increases in interest rates are making it difficult to repay these loans.

“Imagine a situation in which the buses do not go onto the roads because of the military situation, and at the same time you have interest rates rising constantly. How do you think the operators will be able to repay the banks?”, asked Nhamane.

He noted that in days of peace 30 to 35 buses a day left from the main long distance terminal in Maputo heading into the provinces. But today only one or two buses a day leave the terminal.

Nhamane believes that only with the return of peace could long distance bus transport recover, and he urged the politicians from the government and Renamo to find a solution leading to effective peace.

Source: AIM