Ministry: Estonia not to take out any loans for Rail Baltica construction

Render of the future Rail Baltica line.
Render of the future Rail Baltica line. Source: RB Rail AS

Estonia has the necessary funding for Rail Baltica planned into its budget and will not need to take out any loans for its construction, the Ministry of Finance said on Tuesday.

"A total of €410.7 million euros has been planned alongside the state budget and state budget strategy for 2019-2023 for Rail Baltica construction costs, €316.3 million of which consists of external support and €94.4 million of co-financing by the Estonian state," a spokesperson for the Ministry of Finance told ERR on Tuesday. "The funds are provided for in the budget, and there is no intention of using loans to cover the Estonian state's co-financing."

The state budget strategy for 2019-2022 unveiled this spring earmarked €118 million for the construction of Rail Baltica, however this period will mostly involve design work and land acquisition, with major construction not to begin until toward the end of this period.

Rail Baltica is a planned double track, European standard 1,435 millimeter gauge electrified railway for passenger and freight transport to run 870 kilometers from Tallinn to the Lithuanian-Polish border. In the course of its construction, new passenger terminals will be built in Tallinn's Ülemiste neighborhood and in Pärnu; new integrated cargo terminals will be built as well.

Construction of the entire railway is projected to cost approximately €6 billion, up to 85 percent of which is to be co-financed by the EU. According to preliminary designs, construction of the Estonian section of the new railway is expected to cost approximately €1.6 billion, with Estonia to pay some €318 million in required co-financing during the prepratory and construction phases of the project, according to the Rail Baltica homepage.


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Editor: Aili Vahtla

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