The state-run company “Moldova’s Railways” will undergo broad restructuring. The company’s director Iurie Topala has told IPN that the restructuring is imposed by the EBRD/EIB financing project and is to be done by 2019.
The state-run company “Moldova’s Railways” will become a join stock company where the passenger transportation and freight transportation services and infrastructure development will be separated. The state will have controlling interest in the new company. The EBRD and EIB consider such an organizational form will ensure greater transparency.
Iurie Topala explained that the division of services will enable the private companies to enter the railway transport sector and propose new routes at prices that will be different from those of the enterprise. “Currently Moldova’s legislation does not envision possibilities of entering this segment for private companies as this is a monopolist state-run company,” he stated.
The director also said that as a result of the restructuring, the number of the enterprise’s employees could decrease, but not significantly. Now “Moldova’s Railways” employs 10,500 people.
At the end of this September, “Moldova’s Railways” raised a loan of €52.5 million from the European Investment Bank. The loan is repayable in 15 years at an interest rate of 1.5% a year. The money will be used to purchase new locomotives and to modernize infrastructure. Also, the European Bank for Reconstruction and Development provided a loan of €50 million. Thus, the investments in “Moldova’s Railways” amount to over €100 million. €5 million is offered by the World Bank and the EU in grant assistance.
