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Estonian company signs contract to bring railway route from China to Muuga

Shipping cargo by cargo ship is no longer significantly cheaper than shipping it by rail, making the latter, faster option more attractive.
Shipping cargo by cargo ship is no longer significantly cheaper than shipping it by rail, making the latter, faster option more attractive. Source: (Scanpix)

A subsidiary of Estonian logistics company GTS Express entered into a cooperation contract with a Chinese company in the framework of which initially two trains from Xian per week should begin arriving in Muuga beginning in June.

On April 19, GTS Rail, a subsidiary of GTS Express, signed a cooperation contract in the Chinese city of Xian with Xian International Inland Port Multimodal Transportation Co. Ltd. for the promotion of railway transport. According to the company, the agreement should help increase trade with Estonia as well as with the EU as a whole.

The agreement is part of bringing the Chinese government-backed Belt and Road Initiative to Estonia. With this contract, the Chinese side agreed to expand subsidies to the Estonian route as well. Four such routes have previously been established from Xian to Europe — to Hungary, Germany, Poland and Finland.

According to current plans, the first train is expected to arrive in Muuga in June, and the plan is to initially send two trains per week, to increase later. "The new trade route is of critical significance, as it is twice or up to three times as fast as the seaway," the company said. "This will give Estonian and EU goods to China and goods from there to here a new, fast and effective transport opportunity as well as revive Estonia as a historic transit country."

GTS Express CEO and GTS Rail board member Marko Lastik expressed pleasure that longtime efforts and presence in China have led to a result which will promote the Estonian economy and trading not only between two countries, but between the entire EU and China. "Entering into this contract will definitely offer greater trade opportunities, promote exports and imports as well as offer more work to local companies, at the same time ensuring stable prices and transit times year round," he said.

"The objective of the signed railway unit goes beyond Estonia, but previously untapped opportunities will now expand to include Estonian e-trade companies and the logistics sector as well," said Ministry of Economic Affairs and Communications Deputy Secretary General for Economic Development Viljar Lubi. "In order to realize this potential in the future, the Estonian state must contribute even more to its e-government solutions, which can further cut down the length of the journey of goods in this field in close cooperation with the Estonian Tax and Customs Board and others. We wish GTS Express success in opening a new and significant route. This proves that Estonia can be a serious partner to the state and businesses of China, and is a steady point at the crossroads of primary trade routes in the future."

The agreement was signed during the visit of a business delegation led by Lubi to China. The visit was organized by Enterprise Estonia in cooperation with the Ministry of Economic Affairs and Communications and the Estonian Embassy in Beijing. The visit focused on discussing a plan of action for the next six months in connection with the e-trade and ICT cooperation agreements concluded with China last November.

Editor: Aili Vahtla

Source: BNS

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