Bypassing possible blockade: will Latvia replace Belarus on New Silk Road?
While Belarus is considering the possibility to block the EU-China rail freight traffic, the other countries could benefit from the controversial decision (if, of course, it is ever adopted). One of them is Latvia. What options is this country able to offer to freight forwarders?
Almost a month has gone by since the President of Belarus Alexander Lukashenko warned the European countries, particularly Germany, on possible blocking the rail freight transit to and from China. Nothing happened during this period. However, the story does not end as such an issue requires much more time to approve and implement an exact decision. For instance, the similar intimidation to redirect export freight traffic from Lithuania’s Port of Klaipeda to the Russian harbours, which was declared by Belarusian disputed leader in late August 2020, started to put into practice only seven months later, in early March 2021. Moreover, this process is not simultaneous, it will last for around three years. Therefore, the European freight forwards and logistics providers have enough time to establish the alternative routes for having a Plan B if Belarus indeed decides to introduce some kind of blocking measures.
Basis for alternative
Which country could be an alternative to Belarus for the New Silk Road container trains? The most obvious answer is Latvia, its northern neighbour. And here are several reasons for this. First of all, the Baltic states, and Latvia particularly, have the same gauge as Russia and Belarus. This is the most attractive issue as the additional transhipment on the border between Russia and Latvia is not needed. This operation could be carried out further, the question of selecting the exact place will be explained below. The second cause is that Latvia is an EU Member, therefore the trains running via the country towards Western Europe do not need additional custom proceedings after crossing the Russian border.
And the third reason is related to capacity. Since LDz Cargo, the national rail freight operator, has been noticing a significant decline in the freight volumes in recent years, there is enough capacity for redirecting China-EU trains. The fourth reason is the strong presence of Russian logistics companies in the Latvian market. Among them is RZD Logistics, which is an active player on the New Silk Road and has two railway subsidiaries in Latvia. They could be also interested in redirecting some freight traffic via the Baltics state, which could offer at least the main options to the freight forwarders in terms of establishing alternatives to the Belarusian railway border crossings.
Latvia & Lithuania
If you look at the map, you will see that that the railway line from Moscow to Riga runs almost straight in the western direction with a small shift to the north. Due to the connectivity with Lithuania, there could be organised a new route for trains to bypass Belarus. It will run via the Latvian stations of Rezekne and Daugavpils in the eastern part of the country towards northeast Poland via Vilnius and Kaunas in Lithuania. Of course, such a route will be longer than the conventional one via the Brest/Terespol border crossing. However, the former will be the easiest alternative if the latter will be blocked for some goods. It is worth adding that the route was tested in April 2020 for delivering boxes from China to Kaliningrad via Latvia and Lithuania.
In this case, transhipment operations could be carried out at several places. At the moment, Lithuanian national rail freight operator LTG Cargo has two intermodal terminals that are capable to tranship containers between the gauges. They are the facilities in Kaunas and Šeštokai, which have a joint annual capacity of around 130,000 TEU. Furthermore, the Rail Baltica line with the European gauge will be constructed by 2026. This will create more options for the new intermodal terminals.
Towards the ports
Another option, which Latvia is able to provide the EU-China rail freight traffic, is multimodal connections similar to those via Kaliningrad. This link requires transhipment of the containers at the seaports. Three Latvian harbours, namely Riga, Ventspils and Liepaja, could be used in this regard. Afterwards, the containers could be transported by ferries to Sweden and Germany. This year Latvia has set a new milestone in developing rail freight traffic. In early June, the piggyback trains loaded with semi-trailers were launched from Riga to the westernmost ports of Ventspils and Liepaja. The containers running from or to China could be a significant impetus in developing intra-Latvian rail freight traffic.
Meanwhile, there is one obstacle to developing the mentioned alternative. It is the underdevelopment of the country’s rail infrastructure. Latvia has the lowest share of the electrified lines in Europe: 14 per cent vs 55 per cent on average. Furthermore, most of the railways are single-track. In 2019 Latvian national railway company Latvijas Dzelzceļš (LDz) had planned to electrify around 700 kilometres of tracks to speed up rail freight delivery across the country. However, a year later, the plans were cancelled due to the coronavirus pandemic and the mentioned decrease in the freight traffic.
The topic of border crossings on the New Silk Road will be discussed at the conference “Railway border crossings – a key to export and transit“. IntermodalNews.pl, the Polish-speaking sister title of IntermodalNews.eu, in a partnership with the ProKolej Foundation will carry out the event to take place on 20-22 October in Małaszewicze, Janów Podlaski and Terespol.
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