site.btaBDZ Management Says Sofia Airport Concession Will Enable Completion of Reform in Railways

BDZ Management Says Sofia Airport Concession Will Enable Completion of Reform in Railways

Sofia, January 13 (BTA) - What the management of Bulgarian State Railways (BDZ) is waiting for is the award of the concession for Sofia Airport to enable the completion of the entire scheme of the reform in the railways, BDZ CEO Vladimir Vladimirov said Friday. He was speaking at a news conference to report the results of the company's operation in 2010-2016.

The concession of Sofia Airport is a key element in the strategy of the present government to save BDZ. The entire logic of everything done at BDZ with the business plans of 2010-2015, is related to this concession, which had to be opened in the beginning of December 2016. This matter has to be resolved in 2017, Vladimirov said. That the concession is delayed is bad for BDZ, since this leads to a higher price of the reform in the railways. Vladimirov recalled that the debts of BDZ in the beginning of 2010 amounted to 631 million leva. To date, the debts have been reduced and include 250 million leva to banks. However, 150 million leva are extremely heavy obligations under the Second Debenture Loan where the interest is 8.0 per cent. BDZ has been sued at all possible instances, the CEO said.

In his opinion, if the concession is not awarded then there should be a reserve variant at state level. This can happen if money is taken from another sphere, if surpluses are used, or though the budget deficit, but a mechanism for resolution of the problem should be sought at any cost. "The 600 million leva provided by the concession are vital for BDZ," Vladimirov underscored.

Nevertheless, the reforms in BDZ have improved the situation, but raising the quality of services requires repayment of all obligations, investments of 210 million leva to purchase 15 new electrical multiple unit trains following a single transfer by the state and capital transfers of 35 million leva in six years. These measures are part of the BDZ plan for 2015 - 2022, as well as of the company divisions' business plans for 2017.