Ukrzaliznytsia has a profit, unlike business, and may not increase the tariff for freight transportation, – Metinvest

Ukrzaliznytsia has a profit, unlike business, and may not raise the tariff for freight transportation – Metinvest / photo UkrzaliznytsiaIn conditions where state monopolies significantly raise energy and transportation tariffs, it is very difficult to think about the future, because business is losing its main export markets and has gone into survival mode. Oleksandr Vodoviz, head of Metinvest Group’s general director’s office, said this at the “Ukraine and the world ahead” conference, which was organized by NV with the support of The Economist.

According to Vodoviz, Metinvest has already faced a significant increase in operating costs and a decrease in competitiveness, which led to the shutdown of the Ingulets Mining and Processing Plant. So now the group’s strategy is to retain the team and maintain current operations. And the additional increase in tariffs will only weaken the position of business.

“Today we have stopped InGZK, that’s 4,000 people without work, for whom we are trying to do everything possible – to find employment on other assets, to help. Two reasons for stopping the asset are high tariffs for electricity and transportation by railway. We do not reach the cost price of our And now we see that Ukrzaliznytsia wants to raise tariffs by 37% gas transportation, and the tariff for electricity transmission has already been increased by 30%. It is very difficult to think about future development in such conditions.

The head of Metinvest’s general director’s office added that regulatory bodies and state-owned companies should build a dialogue with business regarding tariff policy. After all, business is the main consumer of the services of these companies, and their decisions will affect the activities of enterprises and indicators of the Ukrainian economy.

“Yes, Ukrzaliznytsia has its expenses, it has done a lot, helped with evacuation. But we also need to look ahead. UZ has been profitable for the last two years, but we have losses. They have about 6 billion cash for 2024, and we have there is no cash. They do not want to restructure their obligations, but private business has to do it on bonds, etc. And, most importantly, we do not have a discussion with state monopolists “NKREKP, not from UZ, that’s what’s the problem,” he noted.

Earlier, OP Ukrmetallurgprom (UMP) also urged Prime Minister Denys Shmygal and Minister of Reconstruction Oleksiy Kuleba not to raise the tariff for freight transportation of Ukrzaliznytsia: they noted that the Ministry of Development of Communities and Territories of Ukraine conducts behind-the-scenes discussions with UZ without the participation of the business community, at times, the consequences of tariff increases for the economy of Ukraine will be catastrophic and threaten Ukraine with the shutdown of strategic enterprises and a significant reduction in foreign exchange revenue