EBA opposes increase in railway tariffs

In addition to a direct 15% increase in tariffs, the shippers in 2016 saw a concealed raise, which in some cases reached 50%, according to a representative of Kernel Holding S.A. Vitaliy Verhirskiy. At the same time, Ukrzaliznytsia continues to lose billions of hryvnias due to poor turnover of rolling stock.

"Your rail cars stay idle for two days. Loading grain at a rate of 1,800 rail cars per day, this means 3,600 rail cars and UAH 80 million. Multiply this by every day of shipment of grain and you get billions. Work on turnover. This is your turnover and your money. Moreover, in 2016, there was a concealed raise of tariffs by changing plans for the formation of trains. The rate from Volchansk to Belarus increased by UAH 8,000. This is 50%. You have already raised it once, what do you want now!?" Verhirskiy said.

Read alsoInfrastructure Minister insists on regaining control over Ukrainian Railways"We are offering the authorities to impose a moratorium on any increase in tariffs to the establishment of an independent body – the National Commission for Transport Regulation. The Ministry of Infrastructure will have a good incentive to promote the creation of such a body," said Chairman of the Federation of Metallurgists Serhiy Bilenkiy.

"Last year, the Ukrainian metallurgy missed 7% of the ore production volume. In the second half of 2016, steel production was lower than in the first half, by 600,000 tonnes. This negative trend is due to the fact that enterprises have no liquidity, no resources for modernization. It’s easier for a monopoly. You can raise prices by 25% and invest UAH 27 billion. Unfortunately, none of the companies in the market can do that. Metinvest cannot do that, either. Therefore, if you take this money from us, we will simply invest less in environmental projects and such," said Serhiy Skorbun, Head of Marketing Directorate of Logistics and Purchasing of Metinvest Holding.

Read alsoUkrzaliznytsia CEO: Infrastructure Ministry blocks top managers' decisions"Tariffs for rail transportation in Ukraine are among the highest ones… We should not talk about an even greater increase in the tariffs, not about the profitability of the railways, but on improving the quality of performance of Ukrzaliznytsia. How many profitable railway companies are there around the world? Starting with the Polish ones, all of them are traditionally unprofitable. The railway is not seen as a source of profit, but as the infrastructure for the economy," said Miguel Machado, Chairman of the Ukrainian Association of Enterprises and Organizations of Cement Industry Ukrcement.

The representatives of agricultural enterprises, metallurgical, chemical and construction industries also opposed the increase in tariffs of Ukrzaliznytsia.