Rail Baltic 2006-2016 – A Brief History of Political Accomplishments

Esa Nurkka, 9.10.2016
Here is a summary of Rail Baltic’s progress in 2006-2016. A number of Statements, Declarations, Memorandums and even Agreements have been signed over the years, but Rail Baltic still exists only on paper.

Diligent Rail Baltic pioneers at their railroad construction site.

1. March 2006: Declaration of Intent, signed by the transport ministers of the five partner countries in Rail Baltic. The ministers emphasized – among other things – “the importance of defining the border-crossing points and cross border sections of the project”.

• Comment: As of today, defining the alignments in the Baltic States “are on track to be finalized in 2016.”

2. June 2010: Memorandum of Understanding, signed by the transport ministers of the five partner countries in Rail Baltic. The ministers declared that Estonia, Latvia, Lithuania and Poland would "undertake to complete all the commitments related to first phase of Rail Baltic", to clear the table for the next phase.

• Comment: The “Rail Baltica 1” section from Lithuanian/Polish border to Kaunas was partly finished only in 2016, and with the help of a fresh 191 million euros EU funding even the signaling system might be in place hopefully in 2017. However, the capacity of the refurbished track between LT/PL border and Kaunas is a far cry from the high speed double track railway, that is specified in the official Rail Baltic documents.

3. November 2011: Joint Statement, signed by the Baltic Prime Ministers. The ministers agreed “to establish a joint venture of Estonia, Latvia and Lithuania by the end of 2012 at the latest, to implement the project”.

• Comment: In real life, the Baltic Joint Venture was set up only in October 2014, and even in 2016 the JV’s operations are only about to be launched.

4. September 2013: Joint Declaration, signed by the transport ministers of the Baltic States, Poland and Finland. The transport ministers of Estonia and Latvia were fooled into signing the declaration, where they “agreed” that the Connecting Europe Facility would/should offer 85 % funding for any 1520 mm or 1435 mm railway infrastructure project between Kaunas and Vilnius.

• Comment: Originally the ministers were supposed to sign the Shareholders’ Agreement for RB Rail, but with no hope of finding common understanding, the transport ministers eventually settled for signing just a Joint Declaration. The ministers were expected to finalize the statement over the weekend of 14-15th of September 2013 in Vilnius, but there were some last minute problems.

As the other countries were reluctant to back Lithuania’s demand to add the Kaunas-Vilnius connection to the original Rail Baltic route (the one that the Baltic States as well as the European Commission had already agreed on and committed to), the Lithuanian Ministry of Transport surprisingly announced that the signing ceremony was canceled. After having read the news from the Lithuania Tribune on Monday morning, the Estonian and Latvian ministers panicked, and the option for Kaunas-Vilnius -connection was indeed added to the Declaration.

As the negotiations had turned into Baltic mud-wrestling championships, the Polish and Finnish ministers were content to signing only the very first “we have agreed to promote cooperation” liturgic chapters of the statement.

Signing this paper was a monumental mistake, which Estonia’s then Minister of Transport, Mr. Juhan Parts, admitted to the Wall Street Journal in January 2014.

5. June 2014: Joint Statement, signed by the Baltic Prime Ministers. The PMs reviewed the progress of the implementation of the regional Rail Baltic/Rail Baltica projects.

• Comment: Lithuania once again wanted to add the Vilnius clause to the Statement, while Estonia and Latvia naturally objected that. Not surprisingly, the Lithuanian PM Algirdas Butkevičius threatened to walk out of the meeting unless his version of the statement was passed. Now it was the Estonian and Latvian Prime Ministers time to be “jobud” enough to sign the declaration with vaguely (and cunningly, read carefully chapters 4 and 7) formed clauses.

Estonian and Lithuanian Prime Ministers had discussed the Vilnius issue one month earlier, and this is how Estonia’s PM Roivas commented the negotiations at that time: “I think what we agreed today that we will go further as fast as possible in the joint venture establishment. In the [shareholders’] agreement, we will find an appropriate wording [to ensure] that in the next stage [of the project] Vilnius is an essential part of Rail Baltica as well.”

The Lithuanians played hard ball in the negotiations, and Estonia’s PM Taavi Roivas’ gullible and good-natured approach was no match. Adding the Kaunas-Vilnius -section to Rail Baltic is by no means only a matter of finding the proper wording.  

6. October 2014: Shareholders’ Agreement for RB Rail AS, signed by the Baltic transport ministers.

• Comment: The SHA was eventually signed and the JV was established. In due time RB Rail managed to open a bank account to receive the EC funding and also to appoint (despite furious opposition from Lithuania) Mrs. Baiba Rubesa as the full time CEO for the JV. Unfortunately the Shareholders' Agreement was only a measly compromise, and many of the major problems remained unsolved.

7. December 2014: Joint Statement, signed by the Baltic Prime Ministers. The Ministers recognized that “the quick and constructive negotiations to reach concluding the Rail Baltic/Rail Baltica Intergovernmental Agreement is in the fundamental/mutual interests of the Baltic States, as the Agreement is a pre-requisite to successful implementation of this development”.

• Comment: As the Shareholders' agreement was not enough, an Intergovernmental Agreement was needed. The Ministers agreed to extend the deadline for submitting the draft of the Intergovernmental Agreement by the end of January 2015 at the very latest. It took almost two years until the IGA was eventually signed in October 2016. 

8. June 2015: Joint Declaration, signed by the transport ministers of the Baltic States, Poland and Finland, together with Commissioner Violeta Bulc.

• Comment: Poland and Finland got back into the Rail Baltic train, which is nice. A nurkkaresearch analysis of the Joint declaration can be read here.

9. June 2016: Joint Declaration, signed by the transport ministers of the Baltic States, Poland and Finland, together with the European Coordinator Catherine Trautmann.

• Comment: This is a slightly updated version of the June 2015 Joint Declaration. The positive angle in this paper is the signatories’ urge to “strive for an acceleration of the timetable, and start the construction work already in 2018”. A nominal adjustment of the originally über-lax schedule is not much, but at least the spirit is right!

However, Poland remains a problem. The signatories rejoice that the feasibility study for the improvement of the Białystok -PL-LT section is “on-going”, but later they admit that Poland has committed to completing the detailed feasibility study only by 2020.

10. October 2016: The Intergovernmental Agreement was finally signed in October 2016. Lietuvos Gelezinkeliai's CEO Stasys Dailydka was eventually forced to sign on the dotted line on the eve of October the 7th.

• Comment: The Lithuanian Railways did not want to sign the agreement, because they are now not allowed to participate the Rail Baltic tenders. The Lithuanians have delayed this process since 2013, always explaining that they are just "protecting their national interest". At this very moment it seems that Lietuvos Gelezinkelia and their Ministry of Transport have shot themselves in the foot.

Source: leta.lv

Conclusion
Rail Baltic is a 5 Billion euros project. After 10 years of hard work, the Baltic states are still arguing whether they should talk about Rail Baltic or Rail Baltica. For the sake of political correctness, Baiba Rubesa is forced to talk constantly about "Rail Baltic/Rail Baltica" project. Managing a multinational project sure ain't easy.



Confused? If not, you will be, before the first Rail Baltic train leaves the station.