Mongolian Railway is to give year off over 7000 employees without salary

Jan 29 • Companies, Government • 1015 Views • 1 Comment on Mongolian Railway is to give year off over 7000 employees without salary

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But the Minsiter in charge of transportation rejected it. He said that authority and senior management of the Mongolian Railway shall seek the mistake from itself.

Mr. Kh.Battulga made unscheduled visit to the Mongolian Railway. The Mongolian Railway is suffered the most from the economy recession, because its transport circulation is decreased by 4 times. Also it has challenge of renewing its park renovation. Therefore, it planned to release 7000 employees on year off without salary. It is suffered 28 billion MNT loss last year. Mr. Battulga strongly criticized its authority and management.

Here is excerpt from the dialogue of the Minsiter and Mr. B.Otgondemberel, Head of the Mongolian Railway. Kh.Battulga: Our transit transportation is profitable. I made request to spare some of the transportation between Russia and China to Mongolia. According to my request, 16 companies gave their names. So if we make transit transportation, can the Mongolian Railway afford such a load? What is the situation look like now?

B.Otgondemberel: In order to increase our capacity, we need renovation. We can’t afford 100% renovation. Transport load was low in 1994, when foreign aid and Government investment made. Since that time, no notable investment was made into the Mongolian Railway. No money was received in last three years. There is a talk about Millennium Challenge, but it showed zero funding so far.

Kh.Battulga: So if the transit transportation will come up, the Mongolian Railway can’t afford?

B.Otgondemberel: Yes. Our locomotives haven’t been produced since 1990 and they have no spare parts, because they are already old. So we can’t afford increase of transit transportation by two or three times. Our capacity is 15 million tons per year.

Kh.Battulga: What shall we do now? Did you make any calculations or study?

B.Otgondemberel: Park renovation was made in 1955 and 1980. Next renovation should have made in 2005. But we failed to make notable renovation. We need fund for park renovation. No banks give us loan. If we need to make transit transportation, we need to expand our capacity. But right at the moment, we has less load.

Kh.Battulga: How about if we survive until spring, when construction and tourism season starts?

B.Otgondemberel: We much rely on export. Major mining exporters promised notable amount of load order. They want us to decrease our tariff. We will cooperate. Also we need fund for renewing roads.

Kh.Battulga: How many people are working now for the Mongolian Railway? Can’t you build up capital reserve when you had good season of transportation? But now you are talking about releasing your employees on uncertain period?

B.Otgondemberel: Over 16,000 people are working. We have policy of releasing 7000 people and keeping skilled workers only. Also we will give year off to people without salary whom want to and give their social insurance fee.

Kh.Battulga: Why they are released? How can they feed their families?

B.Otgondemberel: We have no work to offer them.

Kh.Battulga: Don’t you have representatives in Erkhuu and Ulan Ude? Do they find transit transport? Our railway has small market.

B.Otgondemberel: We are going this work now. Also we are organizing multi-lateral meeting with Chinese parts. Hope it would help in increase of transport.

Kh.Battulga: Why don’t you did it before? It doesn’t sound nice to hear that you are working after situation got worse.

After his visit, Mr. Battulga established a working group led by Deputy Minister A.Gansukh, to study the operation of the Mongolian Railway. At the end of his visit, the Minister concluded that the Mongolian Railway is like old “Soviet era truck” without technical renovation. But it doesn’t have such a fund to renovate, banks can not provide such investment and funding. So basically, it has to rely on the Government. Also he stated the importance of collaborating with private sector.

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One Response to Mongolian Railway is to give year off over 7000 employees without salary

  1. Barry says:

    I suppose they want the IVN / RTP mining agreement to fund all of their railroad improvements also. They knew they had a problem in 1994. And yet have done NOTHING to alter the situation.
    They say they cannot afford to renovate railroad because they do not have exports, they do not have exports because they need roads and railroad. Some quandry.

    There is a way out allow the private sector to build toll railroads, the government may get money from road and rail taxes. Not so much as to make the tollways non-profit, after all fair is fair is fair.

    just my thoughts.


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