Ukraine Business Roundup
The company said on June 1 that the first quarter of 2026 was a "difficult test," off the back of declining passenger and cargo traffic, as well as diesel and electricity prices, which increased by 50%. Pertsovskyi said the 45% increase would cover about half of the company's projected 26 billion-hryvnia ($587 million) cash shortfall in 2026. The increase is also important for debt restructuring talks and for seeking new loans in the future. Ukrzaliznytsia will bring a new proposal to lenders in July, he added. But Ukraine's powerful agricultural and industrial sectors have consistently opposed plans to raise Ukrzalzinytsia freight tariffs, saying that the increase would make their products uncompetitive. The last time that Ukrzalzinytsia raised tariffs was in 2022, when it raised freight tariffs by 70%. The company has since been unsuccessful in raising tariffs. The freight side of the business has routinely subsidized the loss-making passenger side of the business, although in recent months the freight side of the business has also become unprofitable on the back of decreasing freight volumes. "While Ukrzaliznytsia has met several times with business groups to lay out its arguments for why tariffs should increase, business has always countered this by arguing that the company is inefficient and can cut expenditures," Iryna Kosse, research fellow at the Institute for Economic Research and Policy Consulting, told the Kyiv Independent. "This conversation has repeated itself every year, but rising Russian attacks have injected urgency into the matter this year, as well as the deadline for paying Eurobonds in July," she added. Ukraine's Prime Minister Yulia Svyrydenko told the country's parliament last week that negotiations on an increase in tariffs with business representatives are ongoing.
