Freight traffic growth has been strong, at least in the Federation, and despite a sharp dip is expected to continue. The earlier paragraphs noted the strong growth in freight transport since 2005, albeit moderated by the sharp decline resulting from the economic crisis in the first half of 2009. Over the longer term, the projections suggest that freight traffic will continue its growth. One recent study12, admittedly from prior to the recent downturn, predicted that freight traffic growth in 2015 would be double 2006 volumes in the low scenario, and three times 2006 volumes in the optimistic scenario. An earlier study, prepared by Swede Rail and financed by the Swedish Government13, projected a doubling of freight traffic over the period 2007 to 2015 for both companies.
Both of these projections are likely to be overly optimistic in the short to medium term. The FBH economy is estimated to have contracted by three (3) percent in 2009 and is projected to grow by a mere one-half of one percent (0.5%) in 2010, according to the IMF14 World Economic Outlook of October 2009. Actual freight traffic growth in the medium-term is likely to remain markedly lower than projected in these two studies. ZRS is now projecting that freight traffic will attain 5.31 million tons in 2011, compared to 5.32 million in 2007, suggesting that freight volumes will remain broadly static over this five year period.
Rail passenger traffic continues to face stiff competition from the road sector and is projected to decline in 2009. The density of the network, the topography of the country, and the operational speed and quality of service means that rail will continue to face strong competition from road transport in the transport of passengers. Passenger traffic on ZRS has been broadly stagnant since 2000 in terms of passenger kms, and has been declining year-on-year over the same period. The ZRS Business Plan for 2009-2011 projects that passenger traffic is expected to continue to decline to 416,250 in 2009, rising to a mere 424,616 by 2011, reflecting the expected effects of the international and regional economic downturn.
3. Operating performance of the railways
Introduction
Railways are a capital intensive mode of transport, characterized by high fixed cost and relatively low variable costs. They are cost efficient when the high fixed costs can be shared by a large volume of traffic and when good utilization is made of expensive assets. The railways in the Western Balkans region suffer from poor resource utilization, and the railways in Bosnia and Herzegovina are no exception to this general rule. This stems in part from historical reasons, as the railways were built to handle many times the level of traffic they carry currently (they currently handle about forty-three (43) percent of their 1990 level of freight for instance). They also inherited many more locomotives, wagons, coaches, and staff than needed. The major challenge that these railways face, and the BH railways are no exception, is to better match resource utilization to current and projected need.
Traffic density
Freight traffic density in BH is relatively high compared to neighboring countries. Compared to other South East European countries, freight traffic density—at just under 1.3 million ton km per km of line—is high in BH. It is about the same level as in Romania and it is higher than in Bulgaria and Serbia, although lower than the EU (Table ). However, passenger traffic density is very low in BH, reflecting the inherent unsuitability of the railway mode for short to medium length journeys in this type of typography. Passenger rail services are simply less attractive than alternative transport modes, such as buses.
Table . Freight and passenger traffic density (2007, unless otherwise indicated)
Country
Freight traffic density (000 ton kms per km of lines)
Passenger traffic density (000 pass. km per km of line)
