\r\nLast month the prime ministers of the Czech Republic and Slovakia said the two countries were considering a merger between CD Cargo and ZSSK Cargo. However, CD Cargo is grappling with financial problems of its own, having made a loss of around \u20ac9m last year.\r\nWith doubts growing over the merger, PKP Cargo has started talks with ZSSK Cargo. PKP Cargo currently competes with ZSSK Cargo, operating freight trains through Slovakia into Hungary and it also holds a license in Austria. Cooperation would ease the situation between the two.\r\nFurthermore, there is a real risk that ZSSK Cargo might lose significant coal and ore traffic in eastern Slovakia. US Steel's Kosice steelworks is currently for sale and if Russian or Ukrainian investors take over, as is widely anticipated, steel production is likely to move further east.\r\nZSSK Cargo has accumulated debts of \u20ac600m and the workforce is to be cut by 600 this year.