Zbornik radova Koridor 10 - Kirilo Savić

3rd International Scientific and Professional Conference
CORRIDOR 10 - a sustainable way of integrations
Country
Passenger fare Freight tariff Tariff per rtu
China 0.043 0.023
Russia 0.046 0.022
Czech 0.063 0.071
Poland 0.065 0.061
Germany 0.107 0.033
France 0.121 0.036
Canada 0.128 0.018
USA 0.336 0.015
[€ cent]
0.033
0.035
0.067
0.063
0.070
0.079
0.073
0.176
Table 1. Passenger fare, freight tariff and tariff per rtu for different countries
The horizontal line in Figure 7 was drawn assuming an acceptable tariff of 10 US$ cents per rail traffic
unit, which can be considered high regarding values in Table 1. This being the case, any project falling
above the line would require government subsidies. As an example, for the assumptions made, if the
construction cost is $6 million/km and the required IRR is 8%, only projects with an initial traffic above
650 million rtu per year would not require government subsidies. Such threshold increases if an IRR of
8% is considered satisfactory. In any case, such traffic levels are well above what can be expected on
the Serbian railways. Consequently, for the success of rail projects, relatively high construction (and/or
operation) subsidies by governments would be required.
The analysis described above, using the graphical financial model adapted for railways, was carried
out using assumptions for a hypothetical rail project. However, the results do illustrate the main
problems with railway projects.
5. DISCUSSION AND CONCLUSIONS
Although rail systems are generally considered as a loss making, the transfer of traffic from road to rail
is a declared goal of both the European Union and many individual governments. This transfer is
mainly motivated by increased ecological awareness, so the race for sustainable transport became a
global phenomenon. Modern European railways operate under the conditions of regulated competition
and connection with other modes of transportation via development of Trans-European Traffic
Network.
Since Serbian railways are part of this network, it is necessary to prepare strategic development plan
and to prepare implementation of the projects within the network. But, Serbian Railway Company is
also facing other problems, such as need to increase rail productivity and financial viability.
This paper presented recently developed World Bank toolkit for financial improvements in rail sector. It
can be used for detailed analysis of all financial aspects that can face all, infrastructure, freight and
passenger entity. Also, this toolkit allows prediction of future scenarios.
This paper examined financial model for new rail projects. The financial analysis is performed on
modified toolkit for Public Private Partnership in highways, also developed by the World Bank. The
modified model was then used to run an example of sensitivity analysis of tariffs to factors such as the
required project internal rate of return, level of government subsidies, construction costs, and initial
traffic. Results confirm high dependency of rail system from government subsidy and that it should
only be pursued rail investments on which is expected high traffic density.
Belgrade, 2012 67