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State-owned transport companies to borrow

State-owned public transportation companies will have to borrow to make up for a planned HUF 40 billion cut in next year's state spending and a further HUF 48 billion necessary for restructuring in the coming three years, Transportation Minister Péter Hónig said at an event organized by the Budapest Chamber of Commerce and Industry on Thursday.

The HUF 40 billion spending cut is part of the 2010 budget bill.

Some HUF 330 billion will be spent on interurban transportation in 2009, or about 1.3% of GDP. The ministry will provide HUF 195 billion as support to expenses and offsetting losses, Hónig said. The remainder is coming from part of the proceeds of the sale of MÁV's freight unit MÁV Cargo, and from price subsidies.

The ministry is reviewing 37 spur lines, but a decision on closing the lines has not yet been made, Hónig said. (MTI-ECONEWS)