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YEREVAN MUNICIPALITY UNHAPPY ABOUT PROPOSED CUTS IN GOVERNMENT SUBSIDIZATION OF CITY'S SUBWAY
ARKA
Sep 29, 2011
YEREVAN, September 29. /ARKA/. Yerevan Mayor Karen Karapetyan, speaking
Thursday at the Cabinet's regular meeting, voiced displeasure at the
cuts in the government subsidization of the city's subway, which are
proposed in the 2012 draft budget.
"Taking into account that the subway will have additional financial
resources from the recent fare rise, the finance ministry cut subsidies
by the greater amount than the subway's profits," he said.
"If, for example, we gain 400 million drams, subsidies are cut by
500 million."
On July 1, the subway fare was raised from 50 drams to 100 drams
($0.26), since before that the fare was far lower than the real
spending for transportation of one passenger. In the first quarter
of this year, 160 drams were spent for transportation of one passenger.
The mayor said that if after this fare increase financial flows don't
grow, it will mean that the municipality has assumed the commitments
it can't fulfill.
"We propose to leave the size of subsidies unchanged," he said.
Prime Minister Tigran Sargsyan, on his side, ordered another discussion
of this issue. He said that it would be better to intensify passenger
flows in the subway.
"Otherwise, profitability problem will remain unsolved," he said. "We
have attracted loans for modernizing this subway in a hope that
it will be fully self-sufficient with the lapse of time. Fare was
raised for that. Therefore, the municipality should optimize public
transport traffic."
On August 10, 2010, Armenian finance ministry signed a ~@15-million
agreement with European Investment Bank to reconstruct the Yerevan
subway.
This money is targeted for repairing the subway's warning system,
cars, dilapidated railway lines, electricity-supplying facilities etc.
Another ~@15 million was provided by EU Neighborhood's investment
fund as a grant.
The first stage of the subway modernization program is planned to be
completed in Dec 2012. ($1 = AMD 371.35).
ARKA
Sep 29, 2011
YEREVAN, September 29. /ARKA/. Yerevan Mayor Karen Karapetyan, speaking
Thursday at the Cabinet's regular meeting, voiced displeasure at the
cuts in the government subsidization of the city's subway, which are
proposed in the 2012 draft budget.
"Taking into account that the subway will have additional financial
resources from the recent fare rise, the finance ministry cut subsidies
by the greater amount than the subway's profits," he said.
"If, for example, we gain 400 million drams, subsidies are cut by
500 million."
On July 1, the subway fare was raised from 50 drams to 100 drams
($0.26), since before that the fare was far lower than the real
spending for transportation of one passenger. In the first quarter
of this year, 160 drams were spent for transportation of one passenger.
The mayor said that if after this fare increase financial flows don't
grow, it will mean that the municipality has assumed the commitments
it can't fulfill.
"We propose to leave the size of subsidies unchanged," he said.
Prime Minister Tigran Sargsyan, on his side, ordered another discussion
of this issue. He said that it would be better to intensify passenger
flows in the subway.
"Otherwise, profitability problem will remain unsolved," he said. "We
have attracted loans for modernizing this subway in a hope that
it will be fully self-sufficient with the lapse of time. Fare was
raised for that. Therefore, the municipality should optimize public
transport traffic."
On August 10, 2010, Armenian finance ministry signed a ~@15-million
agreement with European Investment Bank to reconstruct the Yerevan
subway.
This money is targeted for repairing the subway's warning system,
cars, dilapidated railway lines, electricity-supplying facilities etc.
Another ~@15 million was provided by EU Neighborhood's investment
fund as a grant.
The first stage of the subway modernization program is planned to be
completed in Dec 2012. ($1 = AMD 371.35).