Vietnam metro's bus subsidies turn out to be wasteful

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Although Ho Chi Minh City pours million of dollars each year into subsidizing buses as a means of public transport, the buses only meet a tiny portion of the city's current transport demands.

The statistics released at a conference held by the HCMC Institute for Development Studies Wednesday revealed that the subsidies for buses increased 35.7 times between 2002 and 2012, the Saigon Times Daily reported.

The bus fares also increased five times over the last 10 years.

In 2012, the city extracted more than VND1.4 trillion (US$66.2 million) from its budget to subsidize buses, according to the HCMC People's Council.

Duong Hong Thanh, deputy director of the HCMC Transport Department, told the conference that the subsidies for buses saw annual increases due to hiked fuel prices and augmented salaries for related staff.

Meanwhile, a recent survey by the World Bank showed only 1.4 percent of traffic users in HCMC take buses.

Thanh said a number of measures had been taken, including the purchase of new buses, installation of new routes and the launching of promotion programs with prize money to attract city dwellers to take buses. But the measures had not been effective enough.

Lam Thieu Quan, a member of the HCMC People's Council, the city's legislature, said the city should reduce the number of bus operators in order to reduce the costs.

Currently, HCMC has 20 major companies operating public buses, while Hanoi has only eight.

Quan proposed that the city buses accept magnetic stripe cards from bus passengers, rather than cash, for convenience.

There should be subsidy policies for passengers who use magnetic stripe cards and who take buses during rush hours, he said.

Other participants at the conference proposed that the city government allow advertisements both inside and outside buses and install Wi-Fi in the buses to attract passengers.

Some said the city should reduce the number of buses with less than 20 seats and consider the use of electric buses to cut costs.

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