bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Wednesday 22.01.2020 | Name days: Austris
LatviaLatvia

Nekā personīga: drop in Russian freights may put at risk railway electrification in Latvia

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

railway, electrification, LDz, Nekā personīga, Riga FreeportIt is expected freight volumes in Baltic States will reduce as a result of Russian transit businesses diverting their freights to the country’s own ports. This creates risks for the long-awaited railway electrification project in Latvia, as reported by TV3 programme Nekā personīga.

Nekā personīga is aware Russian transit business representatives have had to sign a contract with the state, which provides for a specific time frame, during which they have to divert their freights from Baltic States to ports in Russia. Data for railway freights over the railway in November shows the volume of coal, for example, has declined multiple times.

Transport Ministry has ordered Latvian Railway (LDz) to review the company’s costs and prepare for the worst. The future of the EUR 318 million worth railway electrification project is unclear.

Lithuania and Estonia have already begun modernizing their railways, which means if Latvia postpones its project it will lose to its competitors. Freight volume decline also means lower income from LDz, which, in turn, creates risks of the company failing to implement the electrification project. Additional funding from the state budget may be necessary as well, the programme concluded.

Journalists say rapid decline of freight volumes from Russia means the scenario under which the project becomes financially disadvantageous may become a reality.

For years Russia has threatened to divert cargoes away from Baltic States to its own ports. However, freight volumes suffered a considerable decline after Crimea’s annexation.

Nekā personīga is aware Kremlin’s recently prepared plan provides for reducing traditional cargoes to zero and sending only potentially dangerous freights to Latvia.

«This is no secret for Russia to execute the strategic plans the country has hatched over many years – diverting freights to its own ports. The total volume of freights is expected to decline even further in the future. This is why LDz needs to work on developing flexible cost reduction programme so that it is possible to reduce costs in a situation when freights decline,» the porgramme was told by Transport Minister Tālis Linkaits.

Nekā personīga reports that Riga Freeport is still unaware if the port has plans to resign contracts with Russian suppliers in Russia this year. Coal freights from Russia compose one-third of freight volumes handled by Riga Freeport.

The volume of freights carried by LDz in January remained on last year’s level. However, a decline still followed after. Between summer and October, the total volume has not been above 87% of last year’s transported freights, journalists say. A considerable decline has been observed for coal and oil products – respectively 15.5% and 19.1%.

Data available to Nekā personīga about the volume of coal handled by Riga Freeport shows that it has declined three times in November when compared to October.

More on this topic: BATL: railway electrification’s real price will be at least EUR 230 million larger

«Unofficial information shows that Russia’s largest freight carriers have signed with Russia’s government a contract to reduce cargo flow through Latvia’s ports. Russia’s government is very serious about this matter,» says State Railway Administration’s director Juris Iesalnieks.

He also admits the freight decline is noticeable this year – in the first nine months volumes have declined 12.5% when compared to the same period of 2018.

«The situation is especially bad for coal, which has been a saviour for us until now. Currently coal volumes are below the most pessimistic predictions we heard half a year ago,» admits Iesalnieks.

The previous government decided that as the freight volume reduces dramatically, the state may have to reject the EUR 318 million worth railway electrification project.

Nekā personīga reminds that LDz already has debt close to EUR 200 million. Use of EU funds in a time when freight volumes decline may force LDz to either increase tariffs or request money from the state.

LDz electrification project’s documentation has been sent to the European Commission. Soon it is planned to execute tenders. Next year it is planned to perform design work. Construction work is planned to be concluded by the end of 2023, as reported by TV3 programme.

Read also: Transport Minister: there is never anyone responsible for critical situations with ports

«We directly monitor freight indexes and do what we can to increase the amount of them headed in Latvia’s direction. However, I have to say that the volume of freight depends on the geopolitical situation. If we look as the situation over the course of multiple years, it is possible to say we are on the level of 2017. The critical threshold at which it would be necessary to review the project or pick a different solutions has not yet been reached,» journalists were told by Transport Ministry’s Development Directorate’s head Sandra Caune.


Leave a reply

  1. Long term benefits vs. quartals says:

    Changes per quartals cannot be argumented with chancelling an visionaly long term project.

Raimonds Vējonis elected as president of Latvian Basketball Association

On Tuesday, 21 January, former president of Latvia Raimonds Vējonis was elected president of Latvian Basketball Association, as reported by Latvian public media portal lsm.lv.

Spain’s powerful storm turns tragic

In Spain, a powerful storm has brought flooding, low temperatures and violent winds to the country’s eastern coast, where four people died according to the BBC and local authorities.

Riga City Council opposition sees no reason to sign for Oļegs Burovs’ dismissal

Political parties representing the opposition in Riga City Council have no plans at the moment to start gathering signatures to have the city council’s chairman Oļegs Burovs dismissed, because they believe the Saeima will soon vote for the entire city council’s dismissal in the coming weeks, interviewed politicians admit.

Courts in Russian cities evacuated over bomb threats

In Russian cities of Moscow and St. Petersburg, 11 courts have been evacuated after e-mailed bomb threats were received, Russian state news agency TASS reports. This far, the threats have been unsubstantiated

Minister: a wider range of candidates to lead State Police would benefit society

Having a wider range of potential contenders to lead Latvian State Police would be in society’s interests, said Interior Affairs Minister Sandis Ģirģens in an interview to LTV programme Rīta Panorāma on Tuesday, 21 January.

LZP regional faction urges talks to discuss splitting from ZZS

Latvian Green Party’s Cēsis faction believes the party should discuss the possibility of splitting from the Union of Greens and Farmers, as reported by newspaper Latvijas Avīze.

Swedbank predicts 2.2% economic growth for Latvia in 2020

Latvia’s national economic growth in 2020 will rely on private consumption. Overall growth is expected at 2.2%, according to Swedbank chief economist Liva Zorgenfreija.

U.S. impeachment court begins against Donald Trump

In the Senate of the U.S. Congress, the impeachment court is scheduled to begin on Tuesday, January 21, aimed at establishing whether or not U.S. President Donald Trump is guilty in charges related to his foreign policy on Ukraine.

IMF cuts global growth forecast to world economy in 2020

The International Monetary Fund (IMF) has lowered its economic growth forecast for world economy in 2020.

Climate-devoted Davos forum to host conflicting views of Thunberg and Trump

In Davos, Switzerland, the World Economic Forum starts on Tuesday, January 21, with a focus on economic changes to turn to sustainability. Among the speakers there are U.S. President Donald Trump and Swedish climate voice Greta Thunberg.

Latvia commemorates journalists of the Barricades

«Every year on 20 January we gather at the Saeima to commemorate the Barricades of 1991 – the days of protection of Latvia’s freedom. Today all of Riga smells of barricade smoke, of freedom. I believe the fires of freedom lit in commemoration of this day will still be lit year after year from now. Most importantly we cannot let these fires die out in our memory,» said Saeima speaker Ināra Mūrniece in a speech addressed to journalists of the Barricades.

Even Jūlijs Krūmiņš’s penalty is not enough to pull state funding from ZZS

The fine enforced by the office of the prosecutor on businessman Jūlijs Krūmiņš does not provide for terminating payment of state funding for the Union of Greens and Farmers, as reported by the Corruption Prevention and Combating Bureau.

Kariņš: coalition objects lowered requirements for State Police chief candidates

The ruling coalition in Latvia objects against lowered requirements for candidates who want to become the next chief of State Police, not the organization of a selection process, said Latvia’s Prime Minister Krišjānis Kariņš after a coalition meeting on Monday, 20 January.

Last year’s accomplishments in Latvia’s healthcare

In regards to the accomplishments in healthcare observed over the course of 2019, Latvian Healthcare Minister Ilze Viņķele mentioned the cancellation of the initially planned adoption of the two-basket healthcare system and the signing of the agreement for a transition period until 2021, as reported by Healthcare Ministry.

Estonian language inspectors ask Hesburger to translate its «drive-in» signs

Estonian language watchdog has required Finnish fast food chain Hesburger to translate its English language «drive-in» signs into Estonian as the current practice of the company violates the Language Law of the Baltic country.

Minister: Rebenoks is one of the winners of Latvenergo council members selection process

The decision regarding approval of the new Latvenergo council, to which is planned to delegate Latvian Economy Minister Ralfs Nemiro’s advisor Pāvels Rebenoks, could be made by Economy Ministry’s state secretary, said Nemiro.

Railway freight volumes in Latvia drop 15.8% in 2019

When compared to 2018, railway freight volumes in Latvia had declined 15.8% in 2019. Total railway freight volumes reached 41.492 million tonnes, according to data from the Transport Ministry.

UN: Illegal for countries to send back climate refugees

UN Human Rights Committee has found that it is illegal for countries to send refugees to their home countries if their lives or welbeing is in danger at home.

18 589 thousand children born and 12 913 marriages signed in Latvia in 2019

In Latvia, birth number has been declining for four years in a row. 18 589 births were registered in 2019, which is 725 births fewer than in 2018.

Kaimiņš invites KPV LV to decide on party’s liquidation during congress

KPV LV does more bad than good for the country now and is beyond saving, said the party’s founder, Saeima deputy Artuss Kaimiņš in an interview to Latvijas Radio, inviting members of the party to decide on its liquidation at the upcoming congress.

Krūmiņš and Raitums receive fines for illegal financing of ZZS and For Latvia from the Heart

At the end of 2019 Businessman Jūlijs Krūmiņš and financial consultant associated with him Jorens Raitums both agreed to pay EUR 100 000 fine for using third parties to gather money for the Union of Greens and Farmers and For Latvia from the Heart, as reported by TV3 programme Nekā personīga.

Estonian producer price index decreased in 2019

Estonia’s producer price index of industrial output decreased from December 2018 to December 2019 by 1.2%, the country’s official statistical body Statistics Estonia estimated.

Justice Minister: Bičkovičs might pick prosecutor general candidate before amendments

Ivars Bičkovičs, chairman of the Supreme Court of Latvia, may be able to perform some manoeuvres to pick the most appropriate candidate for the post of prosecutor general before amendments aimed at changing the order candidates for the aforementioned position are picked come to force, said Latvian Justice Minister Jānis Bordāns in an interview to newspaper Latvijas Avīze.

Estonian minister stresses immigration’s dominance in population growth

In Estonia, where statistics expect the 2019 to have been the fifth consecutive year of population growth, the Population Affairs Minister has pointed to current foreign immigration rate exceeding the country’s aim of foreign immigration.

Programme: minister wants state secretary gone over an objection

Prior to major changes in Latvenergo’s council and board, the company’s current supervisor and Economy Ministry’s state secretary Ēriks Eglītis may lose his post. It is worth mentioning that he objected to providing Economy Minister Ralfs Nemiro’s once boss Pāvels Rebenoks an official post, as reported by TV3 programme Nekā personīga.


Do NOT follow this link or you will be banned from the site!