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Fitch: Polish Regional Railways may lead to significant capital expenditure for regional governments

The expected development of regional railway operators in Poland may lead to significant capital expenditure and rising costs for regional governments, Fitch Ratings says in a new report entitled Polish Regional Railways: Regions’ Own Railway Operators on Growth Path.

Responding to demand for high quality public transport, Polish regions have started to build their own railway operators, as the ailing company Przewozy Regionalne, which had serviced the market for more than the last decade, undergoes a significant restructuring programme that was initiated in 2015.

The development of own railway operators will require regions to accelerate efforts on increasing the efficiency of their railway companies and to tighten the control of their revenues and costs. The railway transport service also needs to be subsidised as it is loss-making.

Developing own railway operators is increasing the regions’ costs. The regions’ current spending on rail has been on a growth path in the last five years and capital expenditure may be significant as EU capital grants for railway investments (infrastructure, rolling stock and other facilities) are available under the EU budget 2014-2020.

The report  is available at www.fitchratings.com

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