L(ame) R(ocky) T(acky)?

Calls for improving the operation of the problematic LRT railway, which attracts few people and makes little money, range from the set-up of selfie spots and the launch of limited edition souvenirs to free ride to the rapid expansion of the railway network.

It’s not a hyperbole to say the Light Rapid Transit (LRT) project has been dogged by misfortunes, one after another. Facing rounds of delays, lawsuits and controversies, the Taipa section of the city’s first railway was finally in operation in December 2019 after nearly two decades in the making. But the opening has not spelt the end of its black luck. Less than two months after full operation, the Covid-19 pandemic arrived. As the LRT — the project of over MOP10 billion (US$1.25 billion) with an annual operating cost of about MOP1 billion — remains desolate amid the scarcity of travellers and the lack of support from residents, observers demand actions from the authorities to make this white elephant more cost effective. The latest annual report of Macao Light Rapid Transit Corp Ltd (LRT Corp), a government-controlled firm for overseeing the railway, shows the total passenger volume of the railway just reached nearly 1.06 million in its first full year of operation in 2020, or 2,891 passengers a day, thanks to the average daily volume of 16,000 recorded in January 2020 before the onset of the coronavirus outbreak. Following the end of free ride for passengers in February 2020, coupled with the negative pandemic-induced impacts, the daily passenger volume of LRT has only stayed at the level of between 1,100 and 2,200 since then. The annual report also says the ticketing revenue of the railway, its sole income at the moment, amounted to merely MOP2.98 million last year with the single-journey fare ranging from MOP6 to MOP10. In contrast, the passenger volume recorded by the city’s two bus operators totalled about 166 million last year, or 454,700 passengers a day, albeit a decline of over 27 per cent due to the Covid-19 pandemic.

MOP1.03 billion

– Operating cost of LRT in 2020

“Bottomless pit”?

 The president of the Public Utilities Concern Association of Macau, Chiang Chong Fai, has recently called for the suspension of LRT to save public coffers in a seminar. “As the LRT is not a commercial and private project, we should not focus too much on whether it makes profits. But we still have to consider how much value it could generate,” he explains the rationale behind his bold call. “Its operational efficiency has been far below the satisfactory level with the huge operating and maintenance costs and the brisk passenger volume… It also could not create synergy with other public transportation means.” “Thus, I think it makes sense to suspend the operation of the Taipa section of LRT until the completion of other lines and sections like the Hengqin Extension Line and Peninsula East Line,” he continues. “There will surely be some problems arising from the suspension, but the cost of maintaining its operation is too high — the government can’t keep pumping money into the bottomless pit.” Currently, only the MOP10.2 billion Taipa section of the railway — which is 9.3 kilometres long with 11 stations — is in full swing, while the government has budgeted up to MOP4.5 billion to build a station in Barra, linking the railway to the peninsula, which is expected to be ready by 2023. The works for the MOP3.46 billion Hengqin Extension Line, linking the Taipa section to Macau-Hengqin border terminal, are also underway and scheduled to be finished by 2024. For the 7.65 kilometre Peninsula East Line, connecting the Taipa section to the newly reclaimed land plots and the Gongbei Border Gate, a public tender for the construction is expected to be launched soon; for the 3.3 kilometre Seac Pai Van Line, the government has decided to reopen the tender for the construction after the results of the original tender last year failed to meet expectations. There has still not been any news for the two sections in the Macau Peninsula — a major part of LRT — as some of the community have criticised that potential works might impact their daily life.


– Average daily passenger volume of LRT in 2020

Free ride

 Suspension is “not responsible” given the efforts the government has put in over the project, says Ron Lam U Tou, a local political commentator, who adds the annual operating cost of the railway is about MOP1 billion. “It’s difficult for the operation to break even given this unreasonably high operating cost…, [so the government] should think about how to maximise the social benefits the project could bring.” The LRT Corp report shows the operating cost of the railway totalled MOP1.03 billion last year. Though the report does not provide a breakdown of the expenditures, the expenses actually includes a MOP5.88 billion contract granted to MTR Corporation Ltd — the operator of the Hong Kong eponymous railway with the Hong Kong government being the major shareholder — for running and maintaining the LRT in the first 80 months of operation. Besides, the Macau authorities have previously revealed the electricity bill of the railway amounted to MOP40 million a year. As a whole LRT Corp still managed to achieve a profit of MOP47.76 million in 2020, thanks to a government subsidy of MOP1.07 billion. With an operating cost of about MOP1 billion a year, the annual passenger volume of the railway has to be 100 million for the railway to break even provided the ticket fare is MOP10 each and there is no other revenue besides ticketing. Given the higher passenger volume during the first two months of operation — between 33,000 and 16,000 passengers a day — when there was free ride, Mr. Lam, who is also the president of the local think tank Macau Synergy Association, suggests the LRT could be open to the public for free at the moment to “attract more people to take the LRT”.

 “Its operational efficiency has been far below the satisfactory level with the huge operating and maintenance costs and the brisk passenger volume,” says Chiang Chong Fai, president of the Public Utilities Concern Association of Macau


 “When the government first decided a few years ago the Taipa section should be operational first, the community had already suggested the section should have first linked to Barra to be more effective,” he says. “So the priority for the authorities now is to ensure the construction of the Barra station to be completed as scheduled and as soon as possible.” The operation could also be further improved, for instance, passengers now cannot use either stored value card MacauPass or e-wallet MPay to directly settle the LRT fare but have to first buy a ticket. “The public do not have faith in the LRT given the turmoil in the past decade and more,” he notes. “The government should have a more thorough approach towards the governance and network plan of the LRT, as well as its role in public transportation.” According to the plans of the authorities throughout the past two decades, LRT should serve as the “backbone” of local public transportation supplemented by other means like buses and taxis. But this vision has not materialised — and won’t do so for at least the next few years. Secretary for Transport and Public Works Raimundo Arrais do Rosário has acknowledged in the Legislative Assembly earlier this year that the LRT has so far brought no benefits to the city but he did not propose any short-run initiatives to drive up the passenger volume. In the annual report, LRT Corp said it has started to incorporate “commercial projects” to broaden its income source besides ticketing, and the preparation has started since the fourth quarter of 2020. But there has not been any news about the latest development of the matter.

 “It also could not create synergy with other public transportation means.” “It’s difficult for the operation to break even given this unreasonably high operating cost…, [so the government] should think about how to maximise the social benefits the project could bring,” says political commentator Ron Lam.

Selfie spots

“As the LRT does not connect to any major districts in the Peninsula or any border terminals now, as well as there are no transit benefits and facilities between LRT and the bus service, it’s not surprising the railway has not been popular among the public,” says legislator Ho Ion Sang. What the operator could do in the short-run is to diversify its income sources. “There could be advertisements on the stations or trains, while LRT Corp could roll out limited editions of LRT-related souvenirs like cards and set up self-service kiosks for souvenirs and cultural creative products in the stations,” the lawmaker notes. “The LRT could also collaborate with local gaming operators and other merchants to organise events and campaigns.” The LRT stations and trains might also feature selfie spots to attract residents and travellers. “These all could help the LRT to earn extra income and reduce its loss [before the government subsidy] while attract more people to take the LRT,” he explains. “The public has always been concerned about the efficiency of LRT, which has taken so much time and money to build,” he adds. “In long term, [the government] should develop the remaining sections of LRT… as soon as possible in a bid to drive up the passenger volume by bringing more convenience to them.”