Bulgarian Transport Minister: Railways Are Insolvent

Business | November 8, 2011, Tuesday // 13:27|  views

Bulgarian Transport Minister, Ivaylo Moskovski, vows the country will have railroad services even though the State-owned railways are now deemed insolvent. Photo by BGNES

People employed by the Bulgarian State Railways BDZ must realize the gravity of the situation, according to Transport Minister, Ivaylo Moskovski.

In a Tuesday interview for the Bulgarian private TV channel bTV, Moskovski declared that the BDZ debt of BGN 800 M had not been serviced in a long time and there is no way the company can repay it.

"When there was a budget surplus of BGN 3-4 B during terms of previous cabinets, it remains unclear why they forced the railways to get loans all while it was known there is no way those loans can be repaid," the Minister said, reiterating that currently no one is repaying these loans, but the planned measures will, "hopefully," in a future moment, allow for some deposits to be made, most likely in 2012.

According to the Minister, the previous cabinets acted in an absurd manner when dealing with BDZ. He gave as example the State getting a loan for BDZ from the World Bank in the amount of BGN 130 M, but five months later shelling BGN 300 M for military aircraft, cutters and weapons.

"It was like we were going to war any moment," Moskovski stated. He explained his institution is going to propose a package of measures to stabilize the company and reduce operational loss. Last year this loss was BGN 50 M, this year – BGN 25 M with the goal to bring it down to zero in 2012, according to the Minister.

Regarding the planned nationwide mass strike of BDZ workers on November 24, he stressed the trade unions are ultimately responsible for such actions.

"The worse version is to declare the company insolvent. We are looking for a mechanism to create a new company because we must have railroad services. We will be seeking ressources to create a new company," Moskovski firmly declared.

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Tags: Transport Ministry, Transport Minister, Strike, trade union, BDZ, Bulgarian State Railways, Ivaylo Moskovski, World Bank, National Company, railway strike, syndicates, BDZ, trains, state railways, trade unions, debt, insolvent

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