Logistics businesses: Stop cross-subsidizing railway transport ({{commentsTotal}})

Freight train in Estonia. Source: (Toomas Huik/Postimees/Scanpix)

The Estonian Logistics and Transit Association would like to make infrastructure fees for transit depend on the market, and change the financing system of the railways so that passenger traffic would no longer be subsidized with money received from freight carriers.

The Logistics and Transit Association met on Tuesday with members of the Riigikogu’s Economic Affairs Committee and Finance Committee to present its proposals for overcoming shortfalls in the logistics sector, the Riigikogu press service said.

The parties in the meeting arrived at the conclusion that the price of the transit passing though Estonia is not competitive. The logistics businesses proposed that the tolerance of the market be taken into account when imposing the rates of national charges.

In addition, the association proposed that the infrastructure fees and methodology of taxation in Estonia be brought into accordance with the principles of the European Union. This meant that the consumer would pay for the costs, and an end would be put to cross-subsidization.

The economic affairs committee supported the association’s idea for lowering fees and tariffs. Its chairman, Aivar Kokk (IRL), said it was a duty of politicians to provide a competitive operating environment to logistics companies compared with other countries of the region, and to help in negotiations with neighboring countries.

The chairman of the finance committee, Mihhail Stalnuhhin (Center), spoke in favor of increasing trade flows with Russia. “Statesmanship is not about fearing your neighbor and preparing for war. Statesmanship is about admitting mistakes and acknowledging that it unfortunately often happens that the interests of other countries and people, such as Ukraine, are more important to us than the interests of our businesses and rural residents,” Stalnuhhin said.

According to a study by Pricewaterhouse Coopers presented at the meeting, international freight transportation in Estonia declined by approximately 50 percent between 2005 and 2015. Freight flows through ports declined by 26 percent, and rail freight flows by 68 percent.

Editor: Dario Cavegn

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