The Underappreciated Connection between Rail Restructuring Strategies and Financing

Abstract The railways industry is a capital-intensive industry requiring very large initial and ongoing investment streams. Proposals to restructure the traditional state-owned monopoly railway in a particular country are often designed to address concerns not only regarding inefficient operations and monopoly stagnation but also the long-term unreliability of government financing, especially of the expensive infrastructure. In this regard, the connection between the particular rail restructuring strategy chosen by a country and the ability of the restructured entity to attract financing, especially private financing, merits a closer look.