Minister of Economic Affairs and Infrastructure Taavi Aas (Center) and Finland's Minister of Transport and Communications Timo Harakka signed a Memorandum of Understanding on cooperation between the two countries in the transport sector on Monday.

The purpose of the MoU is cooperation in the transport sector and exchange of information between the countries in order to promote large-scale transport projects, such as the Helsinki-Tallinn tunnel, Rail Baltica, Trans-European Transport Networks, and North Sea–Baltic Sea core network corridor. The MoU provides an improved environment for applying EU funding for the projects, the Ministry of Economic Affairs and Infrastructure announced.

Aas said he is glad that Finland and Estonia have agreed upon a common ground for the Tallinn-Helsinki tunnel project and Rail Baltica. "The final stop of Rail Baltica should not be Tallinn but Helsinki. Integrating the tunnel to TEN-T will serve as a new freight gateway to Europe and make our capitals a twin-city," Aas added.

The agreement means the plan can be added to the Trans-European Transport Network (TEN-T) which creates the possibility to apply for European funding in the future.

Although the project would be coordinated by the two countries, the involvement of private sector funding is considered. Estonia and Finland are to agree on the best organizational model and will also conduct analyses.

"To put it mildly, it is complicated to do this project with money from Estonia and Finland alone, that is why we want to bring in EU co-financing and seriously consider involving the private sector in the project," Aas said.

As the memorandum states the project to be of high security risk, the involved partners will go through detailed processing. Previously, there have been suspicions about the involvement of Chinese Touchstone Capital Partners' willingness to invest €15 billion in the tunnel.

The economic affairs ministry will re-launch the Tallinn-Helsinki Tunnel Working Group in the near future which includes representatives from both governments and Tallinn and Helsinki city governments.

Aas said the next step is conducting environmental and cost-effectiveness studies: "We are still far away from designing. The primary assessments say the tunnel has quite a price tag, which is why we need to find reasonable solutions in cost, but also the environment."

The MoU is valid until 2030. If neither of the two parties involved decide to step out of the agreement, the memorandum will be extended by another decade.

A study conducted in 2018 states that the volume of freight and passenger transport between the two countries is set to double or even triple in the next 30 years. The undersea railway tunnel would hold significant growth potential, the study stated.

At 103 km, the undersea tunnel would immediately become the longest of its kind in the world. Calculations for the project show that 12 million people would use the train for travel between Estonia and Finland and 11 million people would still choose ferries - a total of 23 million travelers by 2050.

The railway tunnel would allow trains to travel at 200 km/h, reaching Helsinki from Tallinn in 30 minutes at a price of €18 per trip. Some 40 trains are expected to run between the two cities daily. There would be separate trains for car, truck and freight transport. These would run 30 times a day with a maximum speed of 160 km/h.

The full memorandum is available in English:

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