Employers' Federation protests planned freight rate increases
The Federation of Employers of Ukraine has sent a letter to Prime Minister Yuliia Svyrydenko, strongly opposing the proposed 45% hike in Ukrzaliznytsia's freight tariffs. According to the organization, such a move would trigger a loss of over UAH 100 billion in Ukraine's GDP, reduce tax revenues, and hurt the railway operator itself by shrinking its freight base.
Currently, Ukraine's industrial output is 30–35% below pre-war levels. Freight transport tariffs have already more than doubled since the war began. Forecasts indicate that a 37% increase in freight rates could cut GDP by UAH 96 billion. Freight volumes have dropped sharply—from over 300 million tons to roughly 160 million tons projected for 2026—highlighting a deepening crisis in the sector.
Government urged to act as losses mount
The Federation argues that 'raising freight tariffs is being used as a substitute for improving labor productivity and optimizing Ukrzaliznytsia's costs.' It calls on the government to cover passenger service losses directly from the state budget and to push for greater efficiency at Ukrzaliznytsia.
Projected losses for Ukrzaliznytsia's passenger segment in 2026 could exceed UAH 25 billion. The government has already allocated UAH 16 billion for passenger transport support that same year. The railway's deteriorating finances, shrinking freight base, declining industrial output, electricity shortages, disrupted logistics, high security risks, and falling foreign currency revenues and tax income all demand urgent state intervention.
Yuliia Sirko, first deputy chair of the Verkhovna Rada's transport and infrastructure committee, has also stressed the need for thorough debate on any tariff increase exceeding 40%. The situation calls for a comprehensive government approach to prevent further economic damage.
Raising Ukrzaliznytsia's freight tariffs could severely impact Ukraine's economy, especially given existing production and logistics challenges. During wartime, when the economy is already under immense strain, each tariff hike adds another burden on businesses and citizens. Policymakers must weigh these factors carefully to avoid worsening the economic outlook. Swift, coordinated action is now essential to support key sectors of the economy.
As the debate over freight tariff increases intensifies, the need for a more sustainable funding approach for the railway sector becomes evident. Recent discussions suggest that adopting a EU-style state funding model could be a viable solution to alleviate the financial strain on Ukrzaliznytsia. This shift may help stabilize both freight and passenger services while addressing the underlying issues affecting the railway's performance.