Macedonia's Railway Has No Title Deeds for Land Worth 117 Million Euros - and Pays Fees on Loans It Never Drew

The railway owns land with a book value of 7.22 billion denars - around 117 million euros. There are no title deeds for it. That's one of the findings of the State Audit Office on the public enterprise Macedonian Railways - Infrastructure for 2024, and it isn't the worst.

Property that exists only in the books

A full 91 percent of the structures that make up the railway's line infrastructure, worth 12.77 billion denars, are not registered in the infrastructure cadastre. For 88 percent of its other structures, the company has no title deed to prove they belong to it. That doesn't mean the property has been lost or stolen. It means the state runs tracks and land that it can't show on paper that it owns.

Paying for loans nobody drew

Loans totalling 191.4 million euros were approved for building and renovating the tracks, and 44 percent of that money still hasn't been drawn. But fees are being paid on the undrawn money too: by the end of 2024, 7.78 million euros in commitment fees had been paid, plus 2.85 million euros in interest in 2024 alone. The state is paying for money it isn't using.

On Corridor 8, the Kumanovo - Beljakovce section was supposed to cost 39.7 million euros. With the contract annexes and what's been paid so far, the auditors put it at 77.8 million euros - 96 percent more expensive, with the deadline extended by 8 years and 3 months. The second section, Beljakovce - Kriva Palanka, only got a 155-million-euro contract in July 2022, 18 years after construction stopped. The deadline is October 23, 2026; the company says physical progress stands at 45 percent.

The tracks on the ground

The auditors identified around 50 locations with defects that can only be fixed with major construction work, where trains are restricted to a crawl of 20 kilometres per hour. They include the Dračevo - Jane Sandanski and Rajko Žinzifov - Veles sections, as well as the bridge near Stobi, whose piers are being undermined by the Crna River and which has given way twice in six years. According to the audit, there has been no significant investment in the tracks for more than 40 years.

Warehouses hold materials bought 15 years ago and never used. Of 1,314 positions in the staffing plan, 718 are filled, and 30 percent of employees don't meet the educational requirement for their job. The company's accumulated loss is almost 4.73 billion denars, and together with Macedonian Railways - Transport, the two state railway companies have accumulated losses of around 186 million euros.

The blame - on the predecessors

The Transport Ministry immediately announced that the reports cover a period when the companies were run by SDSM and DUI appointees, that they ignored the problems, and that prosecutors should examine the findings. The audit covers 2024 - a year in which the government changed halfway through. And tracks without significant investment are, by the audit's own account, a problem going back more than 40 years - not one government's.

If the prosecutors look into the findings, good. But who's going to register the tracks in the cadastre - and when?