450 railway workers laid off

TIRANA, Feb. 8 – In a state of dilapidation and in constant lower revenues for the past 20 years, the state-owned Albanian Railways company has announced it will lay off 20 percent of its staff in the next few weeks. The cuts are part of a reform aimed at reducing losses in the bankrupt railway sector which costs the state budget more than 500 million lek (around 5 million dollars) each year, local media report.
Meanwhile, a conflict has sparked between the Directorate General of Railways and the Railways Union over the drastic job cuts as 50 percent of employees scheduled to be made redundant will be stripped of unemployment benefits. The Union claims that only 50 percent of fired workers will benefit one-year wages under their status, worried over the political support newcomers enjoy. Currently, some 2,100 people are employed in the railways sector, which has seen no major investments during the past 20 years after the collapse of the communist system.
In March 2010, the Albanian government was fined USD 20 million over the unilateral annulment of a 2003 contract, worth Euro 74 million with General Electric. The project cancelled in 2005 was aimed at modernizing the Tirana-Durres railway segment, known also as the electric train, which would have been linked with Mother Theresa International Airport.
A recent World Bank report has ranked the state-owned Albanian railways as the poorest in Southeast Europe as far as traffic density and productivity is concerned. The report ranked Albania’s railways operational performance on the bottom of the 10-country list. The list was led by Turkey, followed by Croatia, Macedonia, Romania, Bulgaria, Serbia, Kosovo, Montenegro and Bosnia Herzegovina. Albania’s traffic density is estimated at 6 percent of the EU 27 while coach, wagon, locomotive and labour productivity vary from 5 to 14 percent of the EU 27. Passenger traffic in Albania declined from 125 million passenger in 2000 to 32 million in 2009. The low level of traffic reflects few passenger trains per day, with distances between stations of 17 km to 50 km. The underlying reasons for declining passenger numbers also include long-travel times, unreliability of services, and uncomfortable coaches. Between Durres and Tiranaء 37 km sectionנthe track was modernized in 1997, yet the speed limit remains 60 km/hour. Due to frequent pedestrian sightings on the tracks, drivers often drive slowly to avoid accidents. This suggests that improved infrastructure will not lead to faster operational speeds if the issue of trespassing and safety– more broadly linked to the absence of a signaling system on much of the networkנis not addressed. There are currently no international passenger services. The number of Albanian Railway employees is high for such a small network yet staff productivity is very low. In contrast to Kosovo Railways, which employs 400 staff for a 333 km network, Albanian Railways employs 1,882 for 424 km of network. This represents less than 7 percent of the EU average and has fallen from the levels seen in 2006-2007. Albanian Railways has a negative net income of Euro 2.1 million in 2008 and losses throughout 2005-2009. Excluding state contributions, the working ratio is considerably above 1, at 1.46 in 2008, reflecting the fact that Albanian Railways is unable to recover operating costs. The rail network is small, with 444 km of single track non-electrified rail with standard gauge, of which 424 km is operated. It consists of 4 main lines: (i) Durres to Tirana; (ii) Durres to Vlore through Rrogozhine; Rrogozhine to Pogrodec; and Vore to Hani i Hotit. In addition, there are two branch lines, one of which is not operational, and two industrial connections؂udull to Fushe-Kruje for cement and Elbasan to the Kurum steel facility. The ‘core network’ consists of 197 km from Durres to Tirana (37km), Vore to Shkoder (85 km), and Shkozet to Elbasan (75km). Although the railway was constructed to serve the freight market, passenger services operate throughout the network, with the exception being between Shkoder and Hani i Hotit.