PKP secures loan, begins news plans for restructuring

Polish State Railways (PKP) will sign a euro 130 million loan agreement today with the European Bank for Reconstruction and Development (EBRD). PKP's representatives refused to disclose further details, but the agreement probably calls for a six-year repayment term, as Treasury Ministry gurantees for the loan expire as of August 20, 2008. The money from the loan will support PKP's restructuring. The Infrastructure Ministry is to prepare, by the end of March of this year, a plan for restructuring the railroad. According to former Transportation Minister Boguslaw Liberadzki, the first stage in the restructuring process is the transformation of PKP into a company capable of competing on the open market. However, PKP management board member Krzysztof Maminski claims that the company needs to save more t han had been planned so far in order to cut costs. Under the previous restructuring program, PKP was supposed to receive subsidies of around zl. 500 million to support regional transport. However this year's budget has earmarked only zl. 300 million for this purpose. Maminski adds that PKP's total revenues this year may be approximately zl. 900 million less than had been forecast. (Rzeczpospolita, March 9-10, p. B1; Puls Biznesu, p. 6) A.Z.