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Romanian Government approved the Memorandum to improve the efficiency of the railway sector

The Romanian Government approved the Memorandum on “Measures to improve the efficiency of the Romanian railway sector necessary to approve the General Transport Master Plan of Romania”.

The document proposals includes a narrower railway network, stimulating competitiveness in awarding public service obligation contracts, establishing key performance indicators in financing railway passenger transport services and cost-cutting plans and the establishment of the Railway Reform Authority, a body under the Ministry of Transport. Between 25% and 40% of the 20.077 km national railway network is subject to closure or leasing to a private operator. In the case of closure, the document suggest building bicycles lines or pedestrian areas

Prime Minister Victor Ponta said last Thursday that railway lines that are no longer profitable should be closed, stating that there is a strategy previously negociated and agreed with the IMF. 

As previously reported by Think Railways, the document motivation is based on the Romanian railway system being in a “state of crisis” and “spiral of decline”. Should the situation be similar to the last 22 years of under-investment in the sector, the British consultant AECOM appointed by the Ministry of Transport to draft Romania’s National Transport Masterplan, projects for 2030 a drop by 97% in the number of rail passengers compared to 1990, reaching less than 20,000 passengers/day for the entire network, a 25% decrease by 2025 and a 48% by 2030 in passenger – km.

Rail passenger transport represents 73% of total traffic and 63% of CFR SA revenues, the state owned rail infrastructure manager. Hence, the potential recovery of the railway systems is mainly based on the performance of the railway passenger transport services.

*Data sources: Ministry of Finance, Ministry of Transport, company annual reports; RON; 2013 June figures

 

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