TAIPEI: The Kaohsiung city government should prepare to take over the debt-ridden Kaohsiung Mass Rapid Transit (MRT) system, as its accumulated losses are projected to reach nearly NT$6 billion ($186 million) by the end of this year, the city council said yesterday.

Speaking at a regular council meeting, city council speaker Chuang Chi-wang said that the city government should not sit idly by as the Kaohsiung Rapid Transit Corp (KRTC) struggles with the enormous debt it has amassed since last April when it began operations.

Rather, the city government should prepare to take over the system in the public's best interests, Chuang said.

Asked about the issue, Kaohsiung city mayor Chen Chu said that unlike the Taiwan high speed rail, the Kaohsiung metro's major problem arises from low passenger volume.

Therefore, the city government has come up with a number of incentive measures to increase passenger loads, according to Chen. The merger of Kaohsiung city and county is expected to help boost passenger volume on the metro system and make it more sustainable, she added.

The Kaohsiung metro system is losing money at an average rate of NT$25 million per month and its estimated losses of NT$6 billion by the end of this year would be more than half of the KRTC's total paid-in capital of NT$10 billion. The amount is also in excess of the maximum limit on bank loans, according to Chuang.

The metro system is a public enterprise, and KRTC cannot suspend the service because of operating losses, he argued.

Chuang also suggested that the city government ask the Control Yuan, prosecutors and investigators to look into whether there were any irregularities in the contracting bid for the project.

China Daily/CNA

(HK Edition 09/24/2009 page2)