THE SLOVAK government has approved proposals to split the state-owned railway into two separate businesses from April 1 2001. The strategy was agreed by the ZSR board last May, and endorsed by the Transport Ministry in August.

Zeleznice Slovenskej Republiky will be transformed into a joint stock company responsible for management of the rail infrastructure, which will be open to any licensed operator. It will also control fixed assets, with a mandate to dispose of surplus property. The company will remain wholly state-owned, and will get a grant of KS40bn to fund track upgrading. ZSR will also take charge of 17 ancilliary businesses, to be spun off in three phases leaving a core staff of around 10000.

Train operations will pass to another state-owned company, Zeleznica Spolocnost, with no historic debt. Its 35000 staff will be split between a small headquarters in Bratislava and three divisions responsible for passenger operations, freight, and rolling stock. ZS Cargo is intended to become a stand-alone subsidiary by 2010.

Total staffing will be cut by 38%, or 30000, and credits totalling 140m euros have been negotiated to fund redundancy and retraining. Up to 32 rural lines totalling 623 route-km will be transferred to private operators or local authorities, or closed. The annual state subsidy is expected to fall from KS5·8bn last year to KS1·7bn by 2007. The government hopes to invite ’a strong foreign shareholder’ to take a majority stake in ZS after 2005. n