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BATL: Transport Ministry plans to increase burden on taxpayers’ shoulders

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULatvian Transport Ministry’s developed development plan for the transit industry, which was presented to Saeima’s National Economy Committee this week, states that raising competitiveness in the country requires subsidizing railway cargo transports.

Inga Antāne, President of Baltic Association – Transports and Logistics, says that instead of thinking of ways to help sort things out in the industry, specifically raising competitiveness of railway transports at the expense of administrative costs and putting off railway electrification temporarily, securing a unified tariff for all regional ports, the ministry wants to delegate maintenance of expensive railway infrastructure on the shoulders of Latvian taxpayers.

BATL believes Transport Ministry has thereby failed to complete the order given by Saeima’s Economic, Agricultural, Environmental and Regional Policy Committee to develop a sustainable strategy for the industry. «The developed plan does not deserve more than 4 out of 10,» which means work was performed formally and was not aimed at saving the industry. It should be added that cargo decline since 2012 has reached 29%, which once again emphasizes that the industry is on the eve of a crisis.

«Transport Ministry basically does not have any strategic vision for the industry’s future development and is out of touch with reality. One of the main problems the industry faces at the moment is railway infrastructure tariff, which is the highest among EU member states. Raising competitiveness of Latvia’s railway infrastructure should be the key word in the plan,» explains BATL.

Instead, the ministry’s plan offers works like «we will look, analyse and evaluate». What it does not offer is any tangible problems, adds the association.

Antāne says that the main conclusion the government is offered take from this plan is that one the country’s largest companies – Latvijas dzelzceļš – should be provided with financial support to make it more competitive. «On top of that LDz would not have to pay dividends. Instead, the money would be diverted back into the company. The state budget is proposed to be used as a funding pool for marketing and representation costs to allow Transport Ministry’s representatives to travel abroad and search for partners. The only result of such visits so far has been the organization of one train a year from China. Port territories are proposed to be converted into industrial territories to allow production. It is also mentioned in the plan that relations with Russia should be entrusted in whole to Foreign Affairs Ministry.»

Antāne adds: «If it is possible to submit such a poorly-made development plan to Saeima’s Economic, Agricultural, Environmental and Regional Policy Committee, we should start worrying about the future of our country’s transit industry. It is time to admit that the country does not have a supervisory and politically responsible ministry, but instead there is only a fake institution that imitates active work. Moreover, it does serious harm to the entire industry.»

BATL believes the only supportable exception in regards to the state’s involvement in railway cargo freights would be the equalization of tariffs on routes towards regional ports, which would secure the same costs for cargo transporters regardless if they use Liepaja, Ventspils or Riga port. A unified tariff is needed to ensure competitiveness of regional ports and equal opportunities for all.

The association also believes that Transport Ministry has acted unaware of serious problems in the industry these past several years. «Incompetent and ruinous decisions, formal write-offs and inaction has led to a situation when the country’s second largest industry stands on the verge of a crisis.»

It should be said that BATL sent a letter to the prime minister, transport minister, economy minister, finance minister and Latvijas dzelzceļš council this September, asking them to come up with a plan to make Latvia more attractive for transit.

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