MÁV GETTING INDEBTED

It is uncertain for the time being how the state will finance the expenses of MÁV Company though Brussels obliges Hungary to do so. The Hungarian Railway Company is in a great financial trouble, burdened with heavy debts.

The economic cabinet has accepted the proposal that the state railway company take a bank loan of HUF 59,5 billion on government guarantee for its operation in 2004 and for its development. The greater part of the credit, HUF 40 billion will be spent on everyday operation. For several years MÁV Company has been doing the same: it receives about HUF 100 billion annual subsidy and takes loans which later the state has to pay.

The sources for development are dissolved by interest burdens while transport without investment is getting more and more expensive. The company this year can spend HUF 82 billion for development, mainly from EU sources and bank credits. This is enough for the renovation of the basic network, to keep the standard of technology, and to renovate part of the carriages used by commuters.

Translated by Péter Szentmihályi Szabó