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. Last Updated: 07/27/2016

Railroad Chief Resists Privatization

Moscow should resist pressure to privatize Russia's massive state railway network because it might leave people in many areas without their sole means transportation, Railroad Minister Gennady Fadeyev said Friday.


In a plea to preserve the state rail monopoly, he sharply criticized what he contended was pressure by the International Monetary Fund to begin privatizing the system.


"Attempts to mechanically implant Western schemes in Russian conditions may have dangerous and inappropriate after-effects," he told a news conference. He contended privatization would result in the closure of many railways, the only means of transportation in some distant parts of the country.


Fadeyev conceded the system is facing problems, including a 20 percent decline in passenger turnover in 1995 and a decline in freight traffic. In addition, customers owe the rail system 7 trillion rubles, and lack of payment undermines renovation.


But Fadeyev noted that 1.8 billion passengers used the system last year, making the system too important to risk privatizing now.