Rails Leading Nowhere

Christian Russu

On the eve of the parliamentary elections, the ruling regime is trying to postpone the railway disaster.

A year ago, I described the dire railway situation, with declining freight volumes, technical degradation, months-long wage arrears, and complete uncertainty about the future. Now, this decline has led to irreversible consequences. Passenger transportation on the CFM railway decreased by a quarter last year. Only one Chisinau-Ungheni domestic route remains while all others have been canceled. Freight transportation, the only source of revenue, has dropped by 40%! By the end of 2024, employees had only received salaries for July, and in the first three months of 2025, only some workers were paid for August, which was only possible due to the sale of three locomotives. In just the past year, about a thousand employees have left the company, and over the past decade, the workforce has been cut in half. But the 190 million leu wage debt is not the only problem. It has reached the point where the administration simply cannot purchase diesel fuel for locomotives or fulfill obligations under the remaining contracts. Debt to suppliers has exceeded 1.2 billion leu. Bank accounts have been frozen for several months, and freight wagons are stuck at the border with Ukraine. After the labour unions’ January announcement of mass protests, the situation led to the disgraceful proposal to sell the Railway Workers’ Palace in Chisinau. The building, located in one of the capital’s most expensive districts and covering thousands of square meters, is effectively sitting idle and has long attracted the attention of oligarchs. They deliberately let it fall into disrepair so they can buy it for nothing, with rental requests for business spaces being denied. This idea did not gain public support, and in order to quell the protests, the authorities had to assure that they would not approve such a measure. The Agency for Public Property director, Roman Cojuhari, commented on the initiative with bewilderment, as if unaware that its authors were his own subordinates on the CFM Board of Directors. The relevant minister, Bolea, along with prime minister Recean, also distanced themselves from the situation, though their denial was quite unconvincing. In the end, the acting director, Serghei Tomsa, was made the scapegoat, and instead, the protesters were introduced to the new leader, Sergiu Cotelnic, who is known in narrow circles as a protege of Andrei Spinu in railway freight transportation. The idea of selling the Railway Workers’ Palace to the public is just a small confirmation of the ruling regime’s plans to privatize the railway and transfer it into the hands of private entities under the pretext of being the only way to save it. To achieve this, the enterprise is being pushed toward bankruptcy. It is evident that the PAS has been harbouring plans for the CFM gradual privatization for several years. In early 2022, a new railway code was even adopted to “eliminate the monopoly” of the enterprise in the services market. Since then, the CFM has essentially remained the transport operator, although in practice, a significant share of revenues has been going to dozens of intermediary and forwarding companies. This public-private partnership has persisted as an intermediate stage, as the authorities lacked the resources to fully absorb and digest the “Soviet-era monster”. Over the past two years, the attractiveness of the asset for potential external partners has decreased. With the resumption of operations at the Odesa ports, railway transportation in the region has stopped being of interest to major freight recipients. This is largely due to the inability of our authorities, together with neighbors in Kyiv and Bucharest, to simply create a competitive route for the transportation of grain, fuel, and other goods. Not to mention the overhyped “Moldovan logistics hub” that has become a media cliché. The active involvement of European and American partners in this process ultimately yielded no results. The grand plans of officials to restore railway routes from north to south have evaporated. A striking example of their failure to deliver on promises is the execution of the plan to replace railway sleepers on the tracks – in 2024, only 7% of the target was achieved. Obviously, there are ways to tackle the deepest crisis at the state enterprise. The first thing that comes to mind is the recent decision of the EU to allocate us a record sum of 1.9 billion euros. Several millions of these funds as emergency aid, along the lines of the January energy grants, would be very useful. Moreover, the government could take the initiative to provide railway financing, create a special fund using internal reserves, and simply start refunding excise taxes on imported petroleum products to the country’s largest diesel fuel consumer – similar to the road fund mechanism. There are plenty of solutions and tools available. However, such measures to restore the enterprise do not align with the interests of the ruling party, despite being advocated by all opposition forces that have joined the election race. Until the elections, the tactic of staff reduction will be used to temporarily cover wage arrears for those still enduring the hardship. To prevent a halt in freight operations, the government plans to allocate 250 tons of fuel per month from its reserve fund for the next four months. Meanwhile, key figures in the ruling regime insist the railway must cut excessive costs, primarily targeting salaries, even the minimum wage of six thousand leu. The ruling party is not particularly afraid of losing the railway workers’ electorate. During the recent protests, activists in the sector, mostly Russian-speaking people from the north of the country, once again demonstrated that they are not supporters of the pro-European political forces. For PAS, the best solution to the situation would be the dismissal and mass emigration of these unreliable citizens, who long for the days of the railway’s glory in the Soviet era.