YANGON Bus Public Company (YBPC) has not received any profits after running for a year and hence the firm cannot pay dividends to its shareholders, according to Yangon Bus Public Company chair U Maung Aung.
The YBPC was registered under the Ministry of National Planning and Economic Development and has been permitted to operate since October 2015.
To upgrade Yangon’s public buses system, a BRT (Lite) system was going to be implemented, said the former Yangon chief minister on May 2015.
At first, the operation started running with government’s investment of K10 billion and another K3 billion from the private sector.
The company had hoped to sell 5 billion shares to the public. One share cost K100,000 and the company sold up to K2.4 billion in February 2016.
For the first phase, the company used nearly K10 billion for importing new buses to run along 30 units of Yangon’s main commuter routes – Pyay Road and Kabar Aye Pagoda road.
When the new Yangon chief Minister implemented the Yangon Bus Service (YBS) system on January 2017, YBPC joined YBS to continue running on the No 37 bus line. For the second phase, the company had already ordered 70 new buses.
“We got over two billion [kyat] from our first time selling our shares … the second time, we got over one billion. There were a total of 1800 shareholders. Our company’s investment is nearly K16.64 billion,” said U Maung Aung.
The company has planned to share profits to shareholders annually and shareholders will receive the interest which is comparable to the Central Bank’s interest rates. However, the company has not received any profits yet.
“We held an annual meeting of YBPC for the first time but we can’t distribute the profits. We already know that we can’t get profits in such a short time,” he added.
To solve Yangon’s notoriously congested traffic, the former government implemented the YBPC. Bus fares were K300 but became K200 when YBPC joined with the new YBS. Although YBPC lost profits when they reduced their fares to K200 from K300, their profits actually increased, said Yangon Chief Minister U Phyo Min Thein in January 2017.
YBPC is a public-private partnership (PPP), which was set up with K10 billion from the government and K2.5 million from five private companies, but they can only run on two main routes for the first phase. Within the first two weeks of 2016, public buses were owned by individually except for the YBPC.
On January 16, 2017, the Yangon Chief Minister revamped the public transport system – the Yangon Bus System: it still includes individual bus owners – together with eight PPP firms – and the government has reorganised the bus lines and streamlined them from 79 to 300. The Yangon Region government has plans to upgrade the system once every three months.
Currently, around 3500 vehicles are employed in the bus system and more buses are needed. The government plans to increase the number of buses to 4500 units, starting from next month onwards.
One month after the YBS started, the Yangon chief minister warned bus owners and drivers that they must follow the instructions of the government. Those who break the rules would be eased out, said U Phyo Min Thein on February 17.
According to the rules of the PPP system, companies can distribute profits monthly or annually. Most bus owners did not want to join the PPP because they wanted a daily revenue.
The YBS system was not a complete success and has received criticism. The government has planned to implement further steps for the YBS to become a smart public transport system. The government hopes that implementation will be completed by the end of 2017.
Source: Myanmar Times
