PROSPECTS for the sale of PKP Cargo SA improved last month when reports surfaced that shares in the state-owned freight operator would go on sale in 2010.

Rail freight in Poland is big business, with PKP Cargo handling around 150 million tonnes a year, much of it coal that moves over relatively long distances. When plans for privatisation were put forward in the 1990s, several potential buyers identified the freight business as a golden goose, but successive governments have blown hot and cold over the idea. In the meantime, the private sector has cornered a share of the market with several open-access operations.

Selling PKP Cargo is expected to generate around 700m zloty for state coffers, and this could be augmented by another 400m zloty if long-distance passenger operator PKP Intercity also goes on the market. In the last few years PKP Intercity has made important strides in updating its rolling stock fleet and developing its sales and marketing techniques, making it a more attractive proposition for investors.

Last month PKP Intercity raised its sights with the announcement of plans to acquire 20 high speed trainsets. Ahead lies the Euro 2012 football championship, and PKP Intercity no doubt hopes for the same success - in terms of traffic and publicity - that DB won during the 2006 World Cup.

New high speed trains would certainly impress the passengers - the problem is that Poland has no high speed lines on which they could run, although plans exist to upgrade the Central Trunk Line from Warszawa to Katowice for 250 km/h.