TRANSPORT BARRIERS SLOW CENTRAL, EAST EUROPE TRADE \ $100 BILLION PRICE TAG TO FIX BAD ROADS, RAILS

TRANSPORT BARRIERS SLOW CENTRAL, EAST EUROPE TRADE \ $100 BILLION PRICE TAG TO FIX BAD ROADS, RAILS

Instead of the Iron Curtain that once split Europe, the Continent is now divided by stiff traffic barriers: bad roads, decrepit railways and clogged waterways that slow the flow of commerce between east and west.

The tremendous cost of solving those transportation problems of Central and Eastern Europe - a price tag estimated at $100 billion - has led the region's cash-strapped governments to pressure European institutions for financial help, and to explore partnerships with private investors.But Wolfgang Roth, a vice president of the European Investment Bank, cautions that because the investment risks are relatively high, private partners for such Eastern European transportation ventures are difficult to find unless governments and European institutions help with the financing.

BURDEN ON TAXPAYERS

''Public subsidies and guarantees provided by the nations of Central and Eastern Europe, as well as by European agencies, will play a decisive role in helping attract transport investments from private partners,'' said Mr. Roth, at a recent meeting of Germany's East and Central Europe Association.

Nevertheless, he predicted that ''the taxpayers, and not the users, will continue to bear most of the burden of financing improvements in the region's transport infrastructure.''

With the European Union now looking toward future expansion into the more prosperous countries of Eastern Europe - including Poland, Hungary and the Czech Republic - transportation improvements could emerge as a major factor in the nations the EU decides to accept.

BRINGING RAILS UP TO SNUFF

According to a recent report by the Center for European Policy Studies, the most pressing transportation problem for most Central and Eastern European nations is bringing their rail systems up to the level of Western Europe's highly developed network, so that rail service is compatible.

The study recommends that the Central and Eastern European region's 10 nations more than triple their annual outlays for rail improvements over the next few years - to about $11 billion a year.

One of the Central European nations with ambitious rail-improvement programs is the Czech Republic. Ceske Drahy, the nation's state railway, plans to place about 500 new freight cars into service by the year 2000, mainly rail platforms for carrying containers. In all, the Czech railroad plans to have about 46,500 freight cars available for transport.

As an example of how an ambitious rail-improvement plan can be financed, Mr. Roth cited the modernization of the Berlin-Prague-Vienna rail line, which crosses Germany, the Czech Republic and Austria. The Czech government will pay a third of the project's $1.1 billion cost, and the rest will be covered by investments and loans from several sources - including international financial institutions, commercial banks and the European Investment Bank.

Meanwhile, some private firms in Western Europe have been investing in ambitious highway-improvement projects in Hungary and other Central-European nations. With the Hungarian government covering a third of the costs, French-led construction consortiums built a stretch of superhighway connecting Budapest with the provincial capital of Kecskemet, as well as another new highway from Budapest to the Austrian border.

TRUCKERS GO TO COURT

While the quality of those new highways are as good as that of any interstate in the United States, the Hungarian highways have not been as widely used because the construction groups have been charging tolls that local truckers and motorists regard as too high. In fact, some Hungarian motor carriers took the construction groups to court over the issue.

Mr. Roth said that, to build and operate major transportation projects in Central and Eastern Europe, ''investors must be willing to take risks that are higher than what they would normally face for construction projects.''