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Fall in rail transit traffic will hit Estonian manufacturing businesses too

The steep decline in Russian transit no longer affects only the Estonian transit sector, but will also affect manufacturing companies, which won't be able to import and export their goods, the Estonian Logistics and Transit Association says, cites LETA/BNS.

"It's not the transit business alone that is a concern, the whole economic environment of Estonia will be impacted. The ports in the first place. And in the end it will be this way that when trains no longer move, companies won't be able to export and import goods either. Manufacturing companies cannot get their raw materials, for instance," the board chairman of the association, Andres Valgerist, told BNS.

He added that given the substantial drop in transit traffic, the per-unit price of the transportation of goods will probably grow.

"When volumes become very small, the per-unit price will skyrocket. Businesses will lose out in competitiveness."

Valgerist also pointed out that if the transport of freight by rail is decimated, the government must start paying money for the maintenance of the railway infrastructure.

"The whole burden will lie on passenger trains, and since they cannot raise the ticket price, one must start paying an extra to the railway," he said.

"Our proposal is that both the railway infrastructure fees and the methodology of their implementation must be reviewed. Today they are not consistent with the European Union directives and principles, which is that the carrier pays. They must be made consistent, in order for competitiveness to increase," Valgerist said.

The volume of rail transit traffic between Estonia and Russia has halved, from 12 to six train pairs a day. Ten years ago, in 2006, Estonian Railways received 32.4 trains from Russia per day on the average.

The CEO of Estonian Railways, Sulev Loo, told BNS earlier on Tuesday: "The reason is economic – oil prices are down, Russia is producing less heavy fuel oil and has found better opportunities for selling it via Russian ports. It's as simple as this."

13.04.2016

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