Ukrzaliznytsia’s CEO Yevhen Kravtsov has resigned after “intense” criticism of the state railway monopoly, according to a statement by Sevki Acuner, chairman of the supervisory board of Ukrzalyznitsia. He held the top position for about two years but has been involved with the railway since 2015, after working as a lawyer for Asters firm in Kyiv.
Kravtsov could not be immediately reached for comment.
“Yevhen has played a key role in rescuing Ukrzaliznytsia from the troubles it was in two years ago and helped to establish corporate governance,” Acuner said in the Dec. 30 statement posted on the railway’s website. “He has also been a genuine team player all along with the supervisory board and the shareholder.”
But Acuner acknowledged: “Recently, the level of criticism leveled at Ukrzaliznytsia has been intense. We always welcome objective criticism and take it into account. It is important, however, for making progress at the institution, that criticisms highlight the shortcomings and needed improvements at Ukrzaliznystia in a constructive way, and not just aim to blame or destruct, and disregard areas of progress. Going forward, we will bring further improvements to our communication channels and platforms with stakeholders to listen more closely to constructive and well-intended criticism.”
Acuner said the railway is “strong and well-positioned to shape and implement the transformation necessary in preparing for the new market and regulatory structures.”
However, many others complain that changes came slowly at Ukrzaliznystia under Kravtsov and that corruption remains unchecked.
Ukrzaliznytsia has been hobbled for years by a bloated workforce of more than 250,000 employees — at least a third more than necessary — and aging rolling stock, including locomotives and railway cars. Agricultural interests habitually complain about the lack of railway cars to move grain to markets during harvest season. And the state railway has sought to keep its monopoly on engines.
Additionally, critics have long complained that the heaviest users of the state railways — including oligarchs shipping steel, ferroalloys, and coal — have not paid their fair share, causing major deterioration of railway tracks.
Moreover, Ukraine has few high-speed passenger rail lines, even though a majority of Ukrainians rely on the national network as their top mode of inter-city transportation. Kravtsov has also said that below-market pricing extends to passenger railway tickets, leaving the agency starved for capital.
In a July 2, 2019 article, the Kyiv Post examined the problems at Ukrzaliznytsia and looked at how the German, Polish and British railways could serve as a model for Ukrainian railways’ modernization.
Andriy Ryazantsev, Ukrzaliznytsia’s financial director, told journalists that the state-owned company needs $37 billion over 30 years’ time to solve all existing problems.
Another critic was former Infrastructure Minister Volodymyr Omelyan. “The services provided by Ukrzaliznytsia do not satisfy either goods suppliers or passengers,” he told the Kyiv Post in 2018.
At the time, he estimated that over 90 percent of the rail company’s assets were obsolete, with cargo train depreciation reaching 98 percent.
