Amid protests and plunder, Bulgaria aims to bring trains up to speed

By Angel Krasimirov and Tsvetelia Tsolova DOBRINISHTE, Bulgaria (Reuters) - The narrow-gauge train snaking its way through the valleys and gorges of southwestern Bulgaria is a lifeline for surrounding villages, but could face the axe as the government tries to modernize a network mired in losses and debt. Corruption and mismanagement have for years hobbled the state railways, which are among the least efficient in Europe, while workers have been caught stealing fuel from locomotives. Many lines have barely changed since the fall of Communism in 1989, despite a sharp drop in population due to emigration and an end to the planned economy. But the Septemvri–Dobrinishte line through what was once ancient Thrace has long been part of the local community. When Reuters took a journey on the scenic route, passengers who met as strangers were soon talking and laughing together. Women in headscarves struggled across slopes by the line, laden with bags and baskets carrying their own produce, including milk and vegetables, to market. The train was half-empty and slow - it typically takes about five hours to cover 125 km (78 miles). "Should the government close the route, most activity in those small, remote stations would grind to a halt," said Dochka Ivanova, a pensioner traveling on the train. "It would be disastrous for the region." Local people are horrified by the possibility that their railway might be replaced by a bus. "This train is the only option for people in several villages. And we're talking about poor people whose only income comes from the milk obtained from one or two cows they breed," Ivanova said. "They must travel to sell the milk and buy some basic products to survive. They continue to live as they lived 100 years ago." WRONG DECISIONS Bulgaria has experienced rapid economic growth since joining the European Union in 2007 but much of its infrastructure is in poor shape. Improvements could help tourism and the wider economy. But Prime Minister Boiko Borisov's plan to overhaul the railways might include axing 1,200 jobs from the state rail company BDZ, privatizing its cargo business and selling assets. Reform is sensitive: BDZ is one of Bulgaria's largest employers with over 20,000 staff but its losses jumped to 51 million levs ($29.5 million) last year from 9 million in 2013. Several governments have shied away from modernization, preferring to use the system to provide cheap transport and public sector jobs. An earlier attempt to sell BDZ's freight unit was derailed by the previous, Socialist-led government, while an announcement of route closures by Borisov in December provoked mass protests, and he quickly backtracked. BDZ chairman Vladimir Vladimirov told Reuters that the company had suffered in the past from wrong decisions and inconsistent policies, including when governments changed. "Also for the state, the railways services have not been a priority. Meanwhile the structure of the population as well as cargo routes have changed; this has not been taken into account and the system has not adapted to the new realities," he said. Local media have also uncovered plunder of fuel by BDZ's own employees. In one scam, workers were bribed $160 or more each per day to look the other way while thieves routinely drained a train's diesel tank, according to a driver whose comments were recorded in a TV sting. Vladimirov said surveillance had improved since he took over the company again last November after a one-year absence. Broken GPS devices that track locomotives had been replaced and cameras installed at fuel stations. "The chances of theft are significantly cut," he said. Vladimirov envisages the government investing 210 million to 430 million levs in BDZ over seven years, depending on state finances. Additionally BDZ will commit 340 million of its own money. That could fund 45 new trains, opening or expanding new lines, improving the network's image and restoring its profitability, he said. But first, Borisov needs approval from Brussels for state aid to BDZ to continue. The company may also seek a loan from the World Bank and hold talks with its creditors to reschedule debts, which total 555 million levs. The average speed of Bulgaria's fastest trains is just 47 km/h (30 mph), compared with 100 km/h for mainline services in Britain, according to local railway authorities. One bright spot is that Bulgaria may open its first high-speed rail link between Plovdiv, the second-largest city, and the Turkish border by the end of 2015 after years of delay. Bulgaria plans to tap about 600 million euros ($670 million) in EU development funds to 2020 to upgrade rail infrastructure and boost services, the transport ministry said. This would be on top of about 230 million euros received since 2007. For some, the changes can't come soon enough. "It's a shame that Bulgarian railways are in such a poor condition," said Rumen Draganov from the Institute of Analysis and Assessments in Tourism. "You need more than eight hours to reach the Black Sea from Sofia, it's just ridiculous," he added. ($1 = 1.7306 leva) (Editing by Matthias Williams and David Stamp)