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Setting off on the wrong track? FDI Ukraine

December 10, 2015

According to the Facebook page of Deputy Minister of Infrastructure of Ukraine Vladimir Omelyan, today the ministry held talks with one of the 3 biggest Asian infrastructure companies which have expressed an interest in high speed rail in Ukraine (as well as road and river infrastructure).

Joint expert work begins next week on proposals.

There is a declared interest in creating a Kyiv – Lviv – Warsaw – Berlin high speed rail link, as well as Kyiv – Odessa.

Outstanding – for the current journey time from Kyiv to Warsaw by train is 17 hours (Train number 67), and there is simply no direct rail route from Kyiv to Berlin.  (For those interested, the rail journey from Odessa to Kyiv is about 12 hours if memory serves.)

Intercity

Anything approaching even the outdated InterCity train will have speeds far in excess of the “Ukrainian snailways” and would something akin from moving from dial-up modem to 5G broadband by way of user perception.

But there is a problem – perhaps.  Or maybe an opportunity.

Anybody that has taken the train from Ukraine to Poland knows that the track gauges are different – and that requires the changing of train/rail wheels at the border.

Thus, not quite as high speed as things could be – despite any such envisaged link still being far swifter than the current rail “services” on offer.

To avoid the need to change the rail/train wheels, is there an opportunity perhaps to lay “European gauge” rail track on a new route and/or line alongside the Soviet hangover gauge upon which “Ukrainian snailways” currently operates?  The beginning of a gradual shift to a very physical logistical “European integration” one western headed track at a time perhaps presents itself?

Twill be interesting to see what decisions the “joint experts” arrive at.  Will Ukraine keep its inherited gauge and continue the practice of swapping rail/train wheels at the European border?  Will the gauge issue have any bearing upon the Asian infrastructure giant’s interest anyway, when the real deal-breaking issues are likely to be far more legislative and bureaucratic when it comes to the State?

Nevertheless, not something that is necessarily going to make the headlines despite it possibly being FDI that can be measured in US$ billions should things not get off on the wrong track, but rather stay on the right track.

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