EXCLUSIVE: Romania To Allow Bucharest Public Transport Cos To Up Tariffs Beyond Inflation

The Government has committed to pass legislation creating a metropolitan transit authority that would supervise subway company Metrorex and above ground public transport company RATB, according to Romania's letter of intent to the IMF, obtained by MEDIAFAX.

"We will pass legislation to establish a new metropolitan transit authority that will oversee Metrorex together with the above ground public transports system in Bucharest (RATB). The law will also allow for greater tariff adjustments, beyond inflation-indexing, in line with the strategic plan of covering current expenditures through revenues and capital expenditures through subsidies," the Government said in the letter of intent.

Over the past years, Metrorex and RATB generally increased tariffs by indexing them to inflation.

The letter also states Metrorex is to lower maintenance costs by 30% by the end of this year.

In the letter following the previous review mission, the Government had undertaken to hike tariffs charged by ten loss-incurring public companies, including passenger railway CFR Calatori, freight railway company CFR Marfa, subway company Metrorex, power company Termoelectrica and the public roads authority CNADNR.

A joint mission of the IMF, EU and World Bank were in Romania between January 25 and February 8 to review the country's progress under a EUR20 billion IMF-led loan secured in spring 2009 and to discuss the terms of a follow-up precautionary deal.

If you liked this story, please follow MEDIAFAX.RO on FACEBOOK »

The content of mediafax.ro is for your information only. Republishing or using this content is forbidden without express consent of MEDIAFAX. For this consent, please ask for it by mail at vanzari@mediafax.ro.