photo: Alstom / Public domain/The "Bridging the rail finance gap: challenges and opportunities for low- and lower-middle-income countries" study cover
On the occasion of the UN’s inaugural World Sustainable Transport Day, Alstom has taken part in a comprehensive study highlighting the potential of rail infrastructure expansion in low-income countries (LICs) and lower-middle-income countries (LMICs) for mitigating climate change.
Led by the International Union of Railways (UIC), the study undertaken by the University of Birmingham and Roland Berger provides input for discussions to be held at the 2023 United Nations Climate Change Conference (COP28). It highlights key recommendations as to how governments, international finance institutions, the international community and the railway industry need to work together to invest in rail and decouple economic growth in LICs and LMICs from transport emissions growth.
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The study, titled "Bridging the rail finance gap: challenges and opportunities for low- and lower-middle-income countries" underscores the essential role of rail infrastructure in driving sustainable development in these countries. It shows that expanding rail infrastructure by up to 192,000km (180,000km interurban and 12,000km urban) could allow the modal share of rail to quadruple to 8%. This could allow the avoidance of 1.8 gigatonnes of CO2 emissions by 2050, a globally significant contribution to climate action. It would also create formal jobs and deliver benefits in terms of increased accessibility and connectivity, as well as bringing much lower negative external costs in comparison to other modes.
"This study lays out a concrete roadmap for transforming transportation through sustainable rail infrastructure. It clearly demonstrates how targeted investments and strategic planning in rail systems in low-income and lower-middle-income countries can lead to substantial CO2 reductions and support sustainable development. This is about making tangible progress in our global environmental goals while shaping the future of mobility,” stated Cécile Texier, Vice President of CSR and Sustainability at Alstom Group.
The study points out the efficiency and sustainability of railways, indeed, it notes that while railways transport 8% of the world’s passengers and 7% of global freight, they account for only 2% of global transport energy demand.
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To address the financial challenges in developing sustainable rail infrastructure in LICs and LMICs, the study makes a number of recommendations, including the provision of grants from high-income countries as part of climate finance and the revision of appraisal methods used by international financial institutions to assess rail projects reflecting their long-term benefits. Also, enhanced structuring of rail projects to stimulate broader economic growth through localisation and technology transfer. Lastly, strengthening institutional capacity and governance systems for improved technical alignment and technological advancement in rail infrastructure is also suggested.
The study demonstrates the power of transforming rail infrastructure in LICs and LMICs, particularly in Senegal. “It is important to note that Dakar is the first city in Central Africa to be equipped with a regional train, financed by multiple development institutions, enabling 36 million passengers to travel since 2021, from and to the Capital. The additional phase, currently under construction, will stimulate sustainable economic growth and create 75,000 jobs, with impacts on social equity. The overall project will reduce up to 340,000 tonnes of CO2 over a 40-year lifetime” concluded Andrew DeLeone, President of Alstom Africa, Middle East, and Central Asia.
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Source: Alstom Press Releases