The EBA called for Ukrzaliznytsia not to raise its freight rates
The European Business Association (EBA) has appealed to Oleksiy Kuleba, Minister of Community and Territorial Development, urging him to reconsider plans to raise rail freight rates by 30%. The business community considers this decision economically unjustified and believes it could negatively impact Ukraine’s economy.
The EBA notes that a sharp increase in rates could lead to a reduction in freight volumes, a decline in the competitiveness of Ukrainian manufacturers, a drop in exports, and a decrease in budget revenues. In addition, the outflow of cargo could also worsen the financial performance of Ukrzaliznytsia itself.
The business association emphasizes that the carrier’s financial problems are systemic in nature and cannot be resolved solely by raising tariffs. According to data from EBA member companies, in 2023–2024, Ukrzaliznytsia’s freight segment generated approximately 20 billion hryvnia in operating profit annually.
Instead, the association cites unprofitable passenger transportation, insufficient government funding, and infrastructure maintenance costs as the main causes of the company’s financial difficulties.
In this regard, the EBA proposes holding open consultations with the business community and, instead of raising fares by 30%, limiting the increase to an economically justified indexation of 5–10%. The association also calls on the government to ensure adequate funding for passenger transportation, continue optimizing Ukrzaliznytsia’s costs, and implement reforms to support freight transportation.
“The business community calls for full state funding of passenger transportation under the public service obligation (PSO) mechanism, continued cost optimization at JSC ‘Ukrzaliznytsia,’ in particular by increasing labor productivity, reviewing the cost base, and optimizing unprofitable infrastructure, as well as to implement measures to stimulate rail freight transportation to support Ukrainian industry and exports,” the statement reads.
This was reported on July 7 by the European Business Association.
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