Fin Min Urges State Railway Co for Further Rehabilitation Measures

Fin Min Urges State Railway Co for Further Rehabilitation Measures

The finance ministry has called on the management of troubled state-owned railway holding company BDZ to propose by the end of Monday additional measures aimed at the company's financial recovery as a condition for getting state subsidy.

These measures should target either lower costs or higher revenues, the state-run Bulgarian National Television (BNT) reported.

The finance ministry suspended the railway operator's 14 million levs ($8.8 million/7.2 million euro) subsidy on July 1 over the company's failure to service a government-guaranteed debt to the World Bank.

BDZ's executive director Yordan Nedev said on Friday, as quoted by the state-run Bulgarian News Agency (BTA), that BDZ passenger trains can stop running in mid-August if the state does not pay the subsidy. In his view, the finance ministry has no right to halt subsidy payments.

A crisis centre that will try to rescue BDZ's passenger transport unit from bankruptcy is expected to be set up later this week. It will include representatives of the company's management, the transport minister and deputy ministers.

On Thursday, prime minister Boiko Borisov proposed that Germany's Siemens acquire BDZ freight unit in exchange for its debt for the purchase of 50 trains seven years ago.

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