A situation when Latvia may commence cooperation with China in the field of carrying railway freight seems very close, says state joint-stock company Latvian Railway (LDz) Chairman of the Board Maris Kleinbergs.
He said in the last decade there was a lot of talk about the opportunity of carrying Chinese freight through Latvia and there had been many attempts to attract such freight.
“It seems we are rather close to the situation when something could start happening with cooperation with China,” said the manager of LDz.
This development is currently in the stage of development, however. Nevertheless, Kleinbergs hopes for good news.
As for the development of Russian freight in the future, he said it was clear ten years ago that sooner or later a moment would come when Russia would have developed its seaports to the point of freight volumes sent through Latvia rapidly decreasing as a result. Latvia suffered this drop in 2019, 2020 and 2021. However, it is unknown how Russia plans to develop its seaports.
Kleinbergs also stressed that development opportunities of the Baltic Sea region were not infinite. This means that everything depends on supply and demand. He is positive about the situation, however.
“Of course it is clear we will not get back the freight volumes that were carried through Latvia in previous years,” said Kleinbergs, adding that LDz’s biggest partner at the moment was Russia, which provided 56% of freight.
According to him, considerable development is not expected there. However, the volumes provided to LDz by the cooperation with Russia will remain within current levels.
He also allows there could be a slight increase. At the very least this is provided by LDz’s business strategy.
“Nothing indicates an incoming drop. It is quite the otherwise – the capacity of Russian seaports is more or less exhausted at this point. One other thing to consider is that Russia’s own products and products sent through Russia in transit are two different stories,” said Kleinbergs.
LDz’s financial data for 2021 are not available as of yet. However, the concern’s turnover in nine months of 2021 was EUR 174.368 million, down by 0.1% YoY. The company’s profits reached EUR 4.472 million as opposed to losses suffered in the nine months of 2020.
LDz is in charge of maintaining public use railway infrastructure and is the parent company of Latvian Railway concern. The concern also includes six subsidiaries: LatRailNet, LDz Cargo, LDz Infrastructure, LDz Rolling Stock Service and LDz Security, as well as LDz Logistics. (BNN/Business World Magazine)