Residents of Cairo’s desert satellite cities rely heavily on central Cairo for work opportunities. Currently existing public transport networks along with those provided informally by paratransit do not sufficiently satisfy demand leading to a high number of private cars on the main roads connecting the older parts of the capital to these outlying districts, far outstripping their capacity.
This has become a significant economic burden on the country. In the World Bank’s Cairo Traffic Congestion Study published in 2014, the economic cost of congestion in 2011 in Greater Cairo alone was estimated to be around $8 billion, approximately 3.6% of Egypt’s total GDP at the time, which is expected to rise to $15 billion by 2030.
To put that into perspective, the same study cited the effect of congestion of other major cities on their national economies. New York’s congestion cost the United States 0.07% of its GDP, while Jakarta’s cost Indonesia 0.6%.
A paper by Alternative Policy Solutions, a public policy research project based at the American University in Cairo (AUC), proposes an approach which would transform Cairo’s satellite cities into transit-centric districts that would negate the need for private vehicles while bringing many direct and indirect economic benefits to the capital.
The paper’s researchers spoke exclusively to Business Forward, namely the author of the paper and director of transport consultancy firm Transport for Cairo (TfC), Mohamed Hegazy, and co-authors senior research analyst at TfC, Adham Kalila, and co-director at the Center for Sustainable Urban Development based at the Earth Institute in Columbia University, Jacqueline Klopp.
The researchers believe that congestion manifests itself in lost productivity, given time lostduring commute and the state of exhaustion that results from the commute, which leads to lost opportunity cost. Additionally, time spent in traffic means that citizens are not engaging in commercial activity, meaning less taxes and purchases spent, as well as poor health due to high pollution.
You state that the relevant authorities should “recognize, accept, and license paratransit.” Why so?
Kalila: Paratransit is a form of small and medium enterprise that brings work to drivers and other industrious citizens in addition to solving a crucial problem for the city. Moreover, the dynamic way that paratransit responds to the needs of the people can never be replicated in a formal bus system with fixed routes.
Hegazy: More than half of Cairo’s population relies on [informal modes of transport] every day to get to work and access opportunities. They are here to stay for the foreseeable future and impossible to replace fully [as] they provide a highly effective service that can be improved.
If the relevant authorities start working with the sector, professionalize it, ensure levels of service and drivers’ rights, you get a better system.
How do you ensure that transit networks and routes attract the sufficient number of passengers and commuters to make them financially feasible and self-sustaining?
Hegazy: The paratransit sector brings a lot of financing on its own: The cost of vehicles, financing for daily operations, [and] marketing. Tapping into this financing is much more financially sustainable and possible than investing in completely new systems and hardware.
The key is, how much do I need to invest per passenger kilometer to yield a better system.
Further, in Egypt, we leave a lot of potential financing mechanisms untapped and unused: Land-value capture, objective-driven fare policies, cross-mode financing, parking etc.
Klopp: Across the globe, the world’s greatest cities invest in transit because it brings higher productivity. Almost every government subsidizes or invests in transit because it is the circulatory system of the city and regional economy and brings enormous benefit. Overall, the benefits to society far outweigh the costs. Cairo has invested in the metro and is continuing to expand it as well as exploring Bus Rapid Transit (BRT) which is an excellent step but it needs to keep investing in all modes including smaller and regular buses and cycle and walking paths that link into the metro and BRT to build a great multi-modal system across the whole city.
What role does the private sector have to play?
Hegazy: Effectively we have two private sectors. The informal paratransit one is private sector, but also the new emerging formal operators such as Mwasalat Misr, ride-hailers Uber [and] Careem, [and] peak-only providers SWVL [and] Buseet.
In Egypt, I think we need two things: The public sector to bridge the gap between the informal paratransit private sector and the formal one by professionalizing the former which is different from just formalizing it.
Kalila: The private sector can be called upon to provide efficient service where the public sector may be too slow to adapt. For example, under the regulation and specification of the authorities, the private sector may consult, market, and even provide the entire service of transit or transit-oriented development by concession from the authorities.
What are the potential economic benefits of your proposals?
Hegazy: The economic benefits are huge. A successful metropolis such as Cairo is successful when everybody can travel easily and reliably within it. With the World Bank we computed an indicator of how well the current network functions, and arrived at 17.59%. The Accessibility Indicator of 17.59% means that on average, every citizen in Cairo can access 17.59% of the city’s jobs within 60 minutes using public transport.
That compares to 40% – 60% for cities such as New York, London or Paris. Think of how much these metropolises contribute to their national economies, and how much each contribution is a direct result of their iconic urban mobility systems.
Kalila: Today’s educated young professionals are choosing to live in denser and less car-dependent cities partly for the experience of living in a city as well as the improved accessibility to services, society, and food. As Cairo expands into the New Desert Communities (NDC), it is following an outdated suburban model where the residents of the outskirts are required to drive to fulfil their basic needs. The resulting car-centric culture discourages educated young professionals from choosing these NDCs as their homes, preferring instead to live closer to the center with metro access and even a brain-drain towards cities in the Global North.
What would businesses have to gain from your proposals?
Hegazy: Urban economics have repeatedly proven the benefits of agglomeration: More specialization of skills, bigger access to markets and higher productivity. Increasing the Accessibility Indicator of 17.59% directly improves the performance of business and their ability to prosper in Egypt and compete internationally.
The GDP losses computed by the World Bank are potential gains to be realized by each and every employer and employee.