Train Service in Moldova Suspended as Railways Cannot Pay Wages

All passenger services in Moldova will be suspended indefinitely after the indebted national railways were no longer able to pay salaries.

Debts

According to Moldovan local media, the national railway company Calea Ferată din Moldova (CFM) is 459 million Moldovan lei (22 million EUR) in debt after years of mismanagement.

The company has reportedly not paid workers’ salaries in months, which has now resulted in the CFM bank accounts being blocked.

During a meeting of the Public Finance Control Commission, commission chairman Igor Munteanu announced that the “the railways have had their accounts blocked today due to the existence of salary debts.”

Munteanu added: “The arrears of several months in relation to CFM employees create a rather problematic situation for the crisis management of this company. For all omissions and mistakes in management, someone must be held accountable.”

Mismanagement

A commission report detailed some shocking cases of mismanagement at the Moldovan railways and has a strong smell of corruption and self-enrichment.

In the years 2018-2019, the company allegedly sold 66 thousand tons of ferrous metals without the approval of the board of directors.

Reportedly, railway rolling stock and infrastructure (such as train wheels) worth an estimated 168 million lei (8 million EUR) was dismantled and sold as well.

An overconsumption of fuel (62,000 litres) was also reported as railway workers allegedly used company resources to refuel their own personal cars. Auditors also discovered unjustifiably bought goods worth over 51 million lei (2.5 million euro).

Suspension of trains

In order to save Moldova’s railways, all passenger trains will be suspended indefinitely from 12th February.

According to a CFM spokesperson, the suspension of all local and suburban trains from 12th February onward is part a last-ditch attempt to revive the company.

The CFM spokesperson explained that the passenger services in Moldova are mostly used by workers of the National Railways who can travel for free as a company perk.

The spokesperson said: “Seventy percent of passengers on local and intercity trains are railway workers.”

The Moldovan Ministry of Economy reported that “from the transportation of passengers on the territory of the republic, CFM incurs monthly losses between 9 and 12 million lei (434,000 to 580,000 EUR)”.

Railway services

The decision to suspend services means that there will be no longer any trains operating on the railway lines from the Moldovan capital of Chișinău to Ungheni, Bălți and Ocnița, as well as on the line from Chișinău to Tighina (Bender) on the border with the unrecognised breakaway republic of Transnistria.

International railway services linking Chișinău with Iași and Bucharest in Romania, as well as those from the Moldovan capital to Odessa, Kiev and other destinations in Ukraine, were already suspended due to the outbreak of the corona virus pandemic.

My take

The mismanagement at the national railway company doesn’t come as a surprise for anyone who knows a bit about Moldova. The country is infamous for political and graft and self-enrichment by the elites working in (semi-) government companies.

In recent years, a sum as big as 1 billion USD (!) has even been stolen from the national bank in an alleged theft by corrupt officials.

There aren’t many countries in Europe where the difference between the elite and the people is bigger than in Moldova, a country in which the average gross monthly salary is just 382 EUR.

It’s a great pity, as the inhabitants of the former Soviet republic are wonderful, hospitable people. A reduction of public transport services is just another hard hit for many of them.

I can only hope that the railway workers in Moldova will get their salaries fully paid and that the recently elected government of President Maia Sandu (a pro-European reformer) can restructure the national railways.

UPDATE 15-2-2021: The indebted national railway company of Moldova has announced that train services in the country will continue to operate as normal, denying earlier reports citing the contrary.

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