Without systemic changes, the reform of Ukrzaliznytsia's fares poses risks to the economy
The launch of a pilot project to reduce cross-subsidization between freight and passenger transport at Ukrzaliznytsia is a necessary step, but systemic reforms in the industry are needed to achieve tangible results.
This was stated by Anatoliy Kinakh, president of the Ukrainian Union of Industrialists and Entrepreneurs.
According to him, the problem of cross-subsidization is deep-rooted and affects the economy, as losses in passenger transportation are offset by raising freight rates.
“This creates unequal competitive conditions and increases the cost of Ukrainian products, primarily in the mining, metallurgical, and agro-industrial sectors. As a result, the competitiveness of our exports declines,” Kinakh noted.
He emphasized that a pilot project alone is not enough—deeper changes are needed in the management of Ukrzaliznytsia.
Specifically, this involves conducting a comprehensive audit of the company, improving legislation, and approving clear financial plans.
“This involves optimizing resource use, transparency, targeted spending, and cost efficiency. Especially given that significant funds are lost due to inefficient procurement and corruption schemes,” he emphasized.
Kinakh also noted that decisions to raise fares should be made solely on the basis of economic calculations.
“Every tariff increase must be accompanied by an economic justification and an analysis of the consequences for the sectors. Decisions must be made according to the ‘do no harm to the economy’ principle,” he added.
According to him, the lack of a systematic approach to tariff policy and the management of state-owned enterprises is hindering Ukraine’s economic development.
As a reminder, due to the need for restoration work following Russian attacks on railway infrastructure, the schedule for commuter transport in the Sumy region has been temporarily adjusted.
On Saturday, March 14, a Russian drone struck a commuter passenger train in the Sumy region. According to preliminary information, no passengers on the train were injured as a result of the strike. The circumstances of the attack and the extent of the damage are currently being determined.
