The COVID-19 pandemic is impacting many aspects of our lives. In order to prevent infection, people have been forced to stay at home, to avoid social contact, and to reduce travel as much as possible.
As a result, public transport systems around the world, usually full of commuters, have been running almost empty. This unprecedented situation calls for sweeping adjustments to the traditional urban mobility model.
Latin American cities have not been impervious to this phenomenon. Falling demand and preventive health measures have led public transport operators to implement changes that will be difficult to sustain. The supply of transport services has remained higher than demand, ensuring sufficient capacity to prevent the spread of COVID-19 and comply with social distance guidelines (minimum separation of 1 meter).
One of Latin America’s worst-affected cities, Lima has seen the ridership on buses, subways, trains, minibuses and vans drop around 93 % during the last months—a figure that is on the high end of the regional spectrum (between 60 and 95 %).
The current conditions have significantly impacted the financial viability of urban transport services, especially considering that most operators in Lima and Callao depend on farebox revenue rather than lump-sum concession contracts.
The future outlook is also a cause for concern. While public transport accounted for 56 % of trips in Latin America before the pandemic, many passengers may turn to private cars based on health considerations. We must work hard to curb this phenomenon and avoid the pollution, congestion, and road crashes that would come with a surge in private car traffic.
Clearly, public transport models will need to adapt. The challenge for local and national governments is to safeguard public transport services—which play a vital role for cities, their residents, and their economy—while preventing the spread of the virus.
There are several measures that could help solve this equation. Cities could consider tapping into non-motorized transport to complement mass transit, including by extending bike lanes and integrating them into the public transport transport network. and integration of cycle path networks. In addition, staggered work hours and teleworking could help reduce and spread transit ridership more evenly throughout the day.
Financial support to public transport companies is another key priority. In Peru, transport companies’ economic support comes through the introduction of a special payment or subsidy for each kilometer traveled by their vehicles. It aims to compensate the financial losses caused by the drop in demand and higher operational costs during the pandemic.
In many countries, public transport is heavily subsidized: in Spain, for instance, the public contribution to the financing of urban transport is close to 50 percent, and the country recently approved a fund of 800 million euros to alleviate the financial pressure on metropolitan public transport operators.
In Latin America, public transport subsidies are typically scarcer. Chile stands out as an exception, with subsidies covering nearly 45% of the operating costs of the bus. The Santiago de Chile metro system is also financed with public resources.
Cases such as Chile point the way forward in the region, especially in the current adverse circumstances, which demand an urgent response from regional and local governments.
With support from the Mobility and Logistics Trust Fund (MOLO), the World Bank is currently helping the Urban Transport Authority for Lima and Callao (ATU) draw on relevant international experience to rethink the future of public transport in the Peruvian capital.
In the face of the pandemic, public transport needs innovative solutions to overcome growing challenges and reinvent itself. Now more than ever, we are excited to continue working closely with client countries in Latin America and around the world to create urban transport systems that are efficient, sustainable, equitable and safe.
The World Bank, with the support of MOLO, would like to thank the senior consultants: Carlos Cristóbal Pinto, Guillermo Muñoz Senda and Juanita Concha for their research and contributions to this blog and other publications, without which it would have been impossible to reach the conclusions that are supporting the transformation of the public transport in Peru and the region.