Rail Baltic at risk after utterance by Kallas

Photo: Peeter Langovits / Postimees

A Rail Baltic expert meeting this week to arrange shareholder agreement for joint Baltic railway company fell apart. Namely, as announced by representatives of Lithuania, they lacked powers to discuss proposals by Latvia and Estonia seeing premier-to-be Siim Kallas told Reform Party general assembly a referendum might be held regarding the project.

«Spoiling the negotiations, the Lithuanians acted as if Estonians had a plan to hold a referendum,» said economy minister Juhan Parts. «The next negotiations are scheduled for April; but I’m troubled that Lithuanians have found new basis, in the speech by Mr Kallas, to delay the issue.»

If the Baltics will fail to create a joint company, it is impossible to obtain the EU money to build the railway. According to Mr Parts, there is no need to hold a referendum, as the building of the railway is supported even in the communes where protests are being voiced regarding the course thereof.

«The first thing the Lithuanians did, they asked about the referendum-proposal by Mr Kallas,» noted Ilze Aleksandrovica, vice chancellor at Latvian ministry of transportation and representative of Latvia in the expert group. «It was impossible to proceed with the agenda, as Lithuanians had not prepared for a single item, actually.»

Even though the expert committee was scheduled to be work through Wednesday and Thursday, the Lithuanian transport ministry development department director Arenijus Jackus claimed he did not leave the consultation prematurely. «We discussed all the topics on the agenda and the Indrek Sirp who presided over the meeting advised that we end the meeting yesterday (on Wednesday – edit) and Latvia and Lithuania accepted the proposal,» explained Mr Jackus. «Holding a referendum is the right of any nation; it is my task to negotiate regarding the shareholders agreement and I cannot say anything regarding this (referendum – edit).»

Mr Kallas, in Brussels yesterday to do his duties as EU transportation commissioner, assured he had not changed his views regarding the necessity of building the new railway. He underlined that Rail Baltic is needed for Estonia and the Baltic Sea region as a whole, seeing we have to do with a vital transport connection to guarantee future economic growth of the region.

«No-one has decided regarding a referendum yet. What I offered, at the general assembly, is in my opinion one way of settling where the railway will run,» explained the presumed new prime minister.

«Actually, we don’t have a day to lose anymore. The project and the possible EU financing, right now, is a unique opportunity to fully integrate us with Europe. Infrastructure-wise, Estonia with the other Baltics is still a part of Russia.»

At the Reform Party general assembly, this past Sunday, Mr Kallas used a wording in his speech questioning the construction of the railway. «I am willing to offer let’s have a referendum whether we need Rail Baltic. If [they think] it’s not needed, then let’s not build [it],» he said. Riigikogu, whose task it is to hold referendums regarding affairs of the state, sees no need to hold a referendum regarding Rail Baltic.

«Offering the idea of a referendum was meant just to point to the option; the Lithuanian delegation, however, used it as a pretext,» explained Kaja Kallas, chairman of Riigikogu’s Economic Affairs Committee. «Economic Affairs Committee has not discussed holding a referendum and the idea is not supported by the government, neither by any political party.»

According to Kalev Kallo, Centre Party representative in Economic Affairs Committee, there is no need for a referendum, as a connection with Europe holds many positives for Estonia. «The new government and prime minister will have to clean up the mess now, the mess they’ve made with their thoughtless talk,» said Mr Kallo.

Comment

Indrek Sirp, Rail Baltic project manager

The consultation in Tallinn, planned for two days, ended with day one as the Lithuanians had no mandate to talk about any of the issues.

Seven topics were on the agenda, issues that need to be solved before joint company shareholders agreement can be entered.

Even though the joint company will be based in Riga, Lithuanians are demanding that the company operate pursuant to Lithuanian law. In principle, a solution like this is possible, not expedient though.

While we wish that the CEO could form his own team, the Lithuanians want that the board, as the council, have a proportionate number of members from every state.

As a total surprise, the Lithuanians are not accepting the requirement, proposed by us, that shareholders of the joint company would assume the obligation to start competing with the company to be created.

There are great misunderstandings regarding the section of the railway from Kaunas towards Poland.

This, the Lithuanians desire to build unto an old Soviet time railway bed, which is curvy and allows only a 120 km/h (75 mph) ride. Rail Baltic profitability calculations, however, prescribe train travel speed of 240 km/h (150 mph).

The greatest contradiction still is connecting Vilnius to Rail Baltic.

In our estimation, the EU financing conditions will not allow taking the main line through Vilnius, as that would upset the profitability calculations. Vilnius could, without any problems, be linked to the line via Kaunas.

I am worried about the timetable of the negotiations; while we have hoped, with each consultation, to at least find a compromise with some issue, thus cutting the number of disputable items, the Lithuanians rather keep bringing new topics every time.