Albania: the war with the COVID-19 pandemic (Agata Domachowska)

Since the coronavirus began to spread in Albania, Prime Minister Edi Rama has endeavoured to be a most active leader and to keep in touch with the citizens constantly. Thus he constantly uses social media, publishing current COVID-19-related information and presenting the government’s activity. Furthermore, the prime minister has sent every Albanian a text message, instructing them how to protect themselves against infection.

As early as on 12th March the Albanian prime minister declared a war on the coronavirus in the name of both the state and the whole Albanian nation. Also, on 24th March the government introduced the state of natural disaster. All the actions undertaken at that time by the authorities were rationalized as intended to prevent the occurrence of the Italian variant.

The prime minister stressed that the state is prepared for four different scenarios of the COVID-19 pandemic; their specifics, however, have not been revealed. Edi Rama only informed the society that he had already appealed to the president of Turkey Recep Tayyip Erdoğan for help in case the apocalyptic scenario comes true. Still, it is not known whether Albania will receive any additional help from Turkey in the near future. Meanwhile, (20th March) the United States Ambassador to Tirana Yuri Kim stated that the US will provide help of the total value of 100 million dollars to Albania and other states fighting against the pandemic. In turn, the European Union – as it was announced by Olivér Várhelyi, the European Commissioner for European Neighbourhood Policy and Enlargement Negotiations – has already allocated 30 million euros for the Western Balkan countries so that the latter can acquire the necessary medical equipment as soon as possible.

Actions taken by the government as part of the war on the coronavirus. On 8th March the society was informed about the first two cases of coronavirus infection confirmed in the state – a father and a son who had earlier returned from Florence. The first, immediate decision was to ban flights and cancel ferry transport to Italy (until 3rd April). Besides, persons coming from Italy were subjected to obligatory 14-day quarantine. A fine of 5000 euros was introduced for violating the quarantine rules. Military and police patrols were sent to monitor the streets and check whether individuals adhered to the rules of self-isolation. Fines were imposed on those who did not comply with the law to remain at their place of residence. At the same time, it was announced that kindergartens, schools and universities would be closed for two weeks. Organization of mass gatherings was prohibited. An appeal was made to individual sport federations to suspend the games. Restaurants, bars, gyms, beauty parlours, cultural institutions, cinemas, shopping centres and public parks were closed. Only grocery stores, banks and pharmacies remained open. Public placed were regularly disinfected. Religious communities decided to suspend the services. Yet another regulation stated that in TV programs (also in talk shows) there can be only two persons in one room.

Initially the government banned moving by car in individual regions of the state (starting from 13–15 March; only ambulances, government services’ vehicles and food transport lorries were exempt). The ban was later extended to the whole state. Public transportation functioned only in Tirana, available solely to health service workers. Simultaneously, the prime minister promised financial bonuses for doctors and other health service employees. On 12th March he also announced introduction of the curfew: the Albanians could go out between 6 and 10 a.m. and then between 4 and 6 p.m., i.e. for six hours each day. For the weekend of 21–22 March, a total ban on leaving the house was introduced from 1 p.m. on Saturday to 5 a.m. on Monday. As a result, on Saturday morning the Albanians flooded the shops, banks and pharmacies, failing to observe the recommended safe distance from other persons. Starting from 23rd March, the curfew lasted from 1 p.m. to 5 a.m., and the fine for breaking it was set at 85 euros. The prime minister warned the citizens that the police and the military were allowed to use force to prevent population movement. Furthermore, according to Edi Rama, people breaking the introduced bans would be treated as “traitors” and deprived of financial help from the state.

Following the initial limitations at the border crossings, the state boundaries ultimately closed on 15th March. All flights to Italy, Greece and later to the UK were cancelled as well. The government began to organize charter flights for Albanian citizens remaining in Italy. Starting from 23rd March, all flights except those by Air Albania were cancelled on the Tirana-Istanbul-Tirana route. Notably, food relief continued to be delivered to families afflicted by the earthquake that occurred in Albania at the end of November 2019.

Financial package. Like other states of the region, Albania predicts that the crisis will have a negative influence on the state of its economy. One of the reasons is that its main trading partner is Italy, which is also the most popular travel destination for Albanians. In 2019, 48% of Albanian export went to Italy. As the statistics show, Italy is where about 50% of all travellers departing from the central Albanian airport head for. What is more, at the beginning of the crisis some factories ceased production, including textile enterprises (trading e.g. with Italy or China); some call centres, servicing mostly Italian market, stopped operating as well. Hence, to protect the Albanian economy against the crisis, the Bank of Albania introduced a three-month holiday period on paying credit and loan instalments, both for natural persons and business owners.

On 19th March the prime minister presented a financial plan which is to translate into limiting the scale of the crisis caused by COVID-19 pandemic. The plan includes:

allocating 25 million dollars to the Ministry of Health and Social Protection for purchasing necessary equipment and supporting the health service workers,
allocating 100 million dollars to businesses that encounter problems with paying their employees,
allocating 65 million dollars for people in need, small businesses and the unemployed,
allocating 20 million dollars to the Ministry of Defence for humanitarian operations,
allocating 10 million dollars to the Council of Ministers’ reserve fund for emergencies,
waiving fees for delayed payment of electricity bills for small businesses and families; over 200,000 citizens are to receive this help from the state budget (cost: 150 million dollars),
postponing the due date for income tax payment to the second half of the year for enterprises with turnover in the range of 20–140 thousand dollars.

The prime minister has also announced that the salaries of the cabinet members and the deputies will be halved, but other remunerations will not be cut. President of Albania Ilir Meta supported the plan proposed by the government and declared halving his own salary as well.

Conclusions. From the beginning of the crisis the Albanian government has consistently introduced subsequent measures as well as fines for not complying with the regulations, with a view to curtail the spreading of the SARS-CoV-2 in Albania. It also regularly informs the society about these measures, while the citizens behave in an orderly manner and submit to the introduced changes. However, Edi Rama’s policy of war on the coronavirus is still subject to criticism, beginning with his controversial use of military rhetoric.

The solutions applied are so restrictive due to the poor condition of the Albanian health service – the state likely would not be able to deal with larger numbers of infected people. In March 2020 there were only 160 respirators in Albania (130 in public hospitals). The authorities ordered 50 more, and informed that Germany would send further 40 devices. Moreover, due to lack of funds, the COVID-19 tests were reserved for people over 65 with co-existing medical conditions.

The prolonged COVID-19 pandemic will negatively influence the Albanian economy, closely tied to the Italian market. Besides, the third major direction of Albanian import is China (following Italy and Turkey). As a developing state, Albania does not have sufficient financial resources to cope in the future with the effects of this crisis, particularly as only four months earlier the country had to deal with the consequences of a devastating earthquake. Thus Albania will be forced to appeal for help to external entities – the EU, the World Bank and the International Monetary Fund. In turn, the announcements regarding future help from the EU, the US and Turkey are aimed at convincing the citizens that Albania has not been left alone by its allies. They also should be read in the context of increasingly frequent announcements that China promised help to such Balkan countries as Serbia, Montenegro and North Macedonia.

Whistleblower in Lithuanian special services (Dominik Wilczewski)

Alleged illegal activities of VSD. The source of information about the activities of the services is a VSD officer who has been given the status of whistleblower. His identity has not been disclosed. In April 2019 (one month before the presidential election), he reported about the details of the case to Vytautas Bakas, who was then the chairman of the parliamentary Committee on National Security and Defence (Nacionalinio saugumo ir gynybos komitetas, NSGK). The officer was to receive orders to conduct actions from the deputy director of VSD Remigijus Bredkis. The orders included checking persons supporting Gitanas Nausėda’s presidential candidacy, who were included on two lists handed out in July 2018 and January 2019. In addition, in September 2018, the officer was instructed to gather information that would confirm the statement of one of the politicians of TS-LKD Žygimantas Pavilionis that Vygaudas Ušackas “is pro-Russian”. The officer was to inform the head of VSD Darius Jauniškis about the results of his work. The whistleblower turned to Bakas, considering that the leadership of VSD violated the principles of the rule of law and political neutrality.

After receiving information from a VSD officer, Bakas turned to the Special Investigations Service (STT) and the General Prosecutor’s Office to determine whether the abovementioned actions constituted an infringement. He found the answers he had received only in January 2020 to be unsatisfactory. On February 4, Bakas, who in the meantime lost his position as chairman of NSGK, forwarded this information to the chairman of the Seimas. However, the presidium of the parliament decided not to initiate an investigation based on the negative opinion of NSGK. Following the disclosure of the case in the media, VSD management denied that it had carried out any illegal activities. Also the office of President Gitanas Nausėda announced that he had full confidence in the security services and warned against dissemination of any information that could discredit state institutions. The president had been previously reassured by the representatives of the STT and the General Prosecutor’s Office that there was no breach of the law. Bakas confirmed that he would seek to initiate a commission to investigate the matter.

Consequences of the case for Lithuanian political life. There are several issues to note. Firstly, there is an ongoing discussion in Lithuania about the powers of special services. On the one hand, the chancellery of the president has recently come out with an initiative to amend the legislation which would sanction, among other things, the procedure for officers to carry out ‘preventive talks’. On the other hand, in February this year, the Ombudsman presented a report containing a number of recommendations regarding the provision of appropriate civil rights standards when conducting operations by VSD (e.g. the time of storage of collected information). A governmental working group was set up at the beginning of March to prepare appropriate legislative changes. The subject of the discussion is also the issue of increasing parliamentary control over services, e.g. in the form of establishment of an ombudsman institution for services. The case of alleged illegal actions of the VSD can be used as an additional argument in favour of increasing supervision. The re-appointment of VSD head Darius Jauniškis, whose first five-year term expires this year (the director of VSD is appointed by the president with the consent of the Seimas), is also questionable.

Secondly, the disclosure of the alleged influence on the election campaign, and in particular the collection of information about Gitanas Nausėda’s entourage, can be seen as an attempt to influence the president. As shown by the behaviour of the head of state, who did not support the allegations against VSD, this manoeuvre failed. The public disclosure of the information possessed by Bakas sparked speculations that the ruling party – the Lithuanian Union of Farmers and Greens (LVŽS) – might have been interested in causing the scandal. This case could serve LVŽS as one of the topics before the parliamentary elections scheduled for October this year, and at the same time as an excuse to try to take control of the services. The reactions of LVŽS politicians – the Prime Minister Saulius Skvernelis, the party leader Ramūnas Karbauskis and the current NSGK chairman Dainius Gaižauskas, expressing confidence in the leadership of VSD, do not seem to confirm this. All of them, however, drew attention to the need to clarify the doubts caused by the disclosure of the Department’s operations. The question remains whether NSGK will deal with the explanation or a separate inquiry committee will be set up.

Thirdly, the motives for the actions of Vytautas Bakas and his links with LVŽS may raise doubts; he used to belong to the party faction but is not currently affiliated. Officially, the MP only wants to determine whether VSD has not exceeded its powers and principles of political neutrality. It is worth noting, however, that Bakas, although no longer a member of the LVŽS faction, served as chief of staff for Saulius Skvernelis’ campaign during the presidential election and is still considered closely associated with the Prime Minister. Meanwhile, the case of the VSD operation was made public the day after the announcement that Ingrida Šimonytė – the former candidate of TS-LKD in the presidential election – will lead this party electoral list (putting her at the top of the list means that she will probably also aspire to become the Prime Minister). Such a coincidence could suggest that disclosure of the case at this moment is a part of the pre-election campaign. The behaviour of leading LVŽS politicians, dissociating themselves from Bakas’ actions, indicates that they are trying to oppose such interpretations.

Fourthly, the question arises who could have authorised this type of activities. Voices appeared in the Lithuanian media pointing to the then President Dalia Grybauskaitė, along with suggestions that she discreetly supported the above-mentioned Ingrida Šimonytė in the campaign. It cannot be ruled out that LVŽS, which is adverse towards both Grybauskaitė and Šimonytė, will use such a narrative in the election campaign. However, it is contradicted by the behaviours of Grybauskaitė herself, who – although she did not refer directly to the revelation about her alleged impact on the services – was in favour of the need to clarify the whole case. What also speaks in favour of the former president is the fact that it was during her term of office that the legislation covering procedures for the activities of secret services and supervision over them was brought into order. At that time, public confidence in VSD also increased (63% according to a survey of the Baltijos tyrimai agency in June 2019). The social and political significance of services increased particularly after 2014, along with the increase of awareness about the threats arising, inter alia, from the aggressive actions of Russia and China.

Conclusions. Regardless of whether the services actually took the alleged actions, this topic will probably become one of the most popular in the upcoming pre-election campaign. Initial reactions suggested the alleged interest of the ruling party in this topic. However, the subsequent statements of its representatives rather prove that they do not want to be directly linked to this scandal. In this context, it is important that in the face of falling support for LVŽS in party polls, there is a risk of losing power after the election. Further developments will depend on what strategy the party leadership finds more beneficial: whether to cut off from Bakas’ actions and try to silence the scandal, or to escalate the situation by making the scandal the theme of his campaign, e.g. by attempting to link VSD activities with Grybauskaitė and Šimonytė. In a situation where allegations would be confirmed, it can seriously damage the reputation of VSD and lead to less favourable perception of this institution by the society. The indictment of the services will compromise politicians who have tried to use this case for particular purposes. In turn, the President’s subdued reaction shows that he will first seek to protect special services – an extremely important and sensitive segment of the Lithuanian security system – against any attempts to politicize them.

Chinese Dragon in the Arctic and Its Influence on the Policy of Norway and Denmark in the Baltic Sea Region (Damian Szacawa)

Damian Szacawa
29 February 2020
IES Commentaries
Arctic, BSR, China, Denmark, Norway, security
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Military engagement of Denmark and Norway in the BSR. Security in the BSR and the North Atlantic area plays a strategic role in Denmark’s security policy. In the light of the Foreign and Security Policy Strategy 2019–2020 (2018), Russia’s aggressive policy in this part of the world, along with the instability in the Middle East and cyber-attacks, is the main source of security threats to Denmark. The BSR’s importance for Norway is slightly different. A white paper titled ‘Setting the course for Norwegian foreign and security policy’ (2017) has clearly indicated the North Atlantic area and the Arctic region as the main geographic spaces of Erna Solberg’s government. At the same time, it was emphasized that the BSR remains an important element of cooperation between European states and the US.

However, despite a noticeable difference in treatment of the BSR, several similarities (which arise from the international position and role of both states) between the strategies of Denmark and Norway can be observed with regard to security of the BSR. Firstly, both states emphasize the importance of the US as the most important ally and, at the same time, a guarantor of their security (through NATO). Defence industries cooperation is important in this context – Denmark (Terma, Multicut) and Norwegian (Kongsberg) armament firms are involved in the construction of a 5th Generation fighter the F-35 Lightning II. Still another example of the US’s significance is a gradually increasing defence spending after the 2014 Wales NATO Summit.

Secondly, both small states share a conviction that multilateral solutions would be better than bilateral ones. A sense of responsibility for strengthening the Alliance’s credibility as a prerequisite for effective deterrence of potential aggressors is related to this. Therefore, both states have been participating in the NATO’s Enhanced Forward Presence (eFP) from the beginning. The Danish Armed Forces (about 200 soldiers) are deployed to Estonia as a part of the UK-led multinational battalion-size battle group, while the Norwegians (about 120 soldiers) are a part of the battalion deployed to Lithuania. Both states also believe that despite frequent tensions in the BSR between NATO and Russia, Russia will not deliberately take military action that could result in an armed conflict with NATO.

Thirdly, both states place great emphasis on the need to comply with international law and the proper functioning of international institutions. At the end of 2019, like other European NATO’s member states, Denmark and Norway agreed to change their contribution in financing common NATO costs between 2021 and 2024 (an increase of just under 8%).

China’s growing presence in the Arctic and the reaction of Denmark and Norway. The foreign and security policies of Denmark and Norway (the so-called “small states”) are more determined by changes in the international system and competition between great powers than by internal factors. The growing rivalry between China and the US is shaping Denmark’s and Norway’s foreign and security policies in the BSR. During the 55th Leangkollen Security Conference 2020 organized by the Norwegian Atlantic Committee, Norwegian Foreign Minister Ine Eriksen Søreide stated that we were facing a gradual shift of the world’s political and economic centre of gravity from Europe towards Asia. Assessing China’s impact on the international order and the Euro-Atlantic security system, she emphasized that the rise in power of China would be a challenge for NATO, thereby reflecting the London Declaration of 4 December 2019.

China’s growing economic and military activity in Africa was noticed (“new colonialism”), although it was considered by the Danish and Norwegian governments as too distant. And, consequently, they did not perceive China’s policy in the Arctic region as a threat to their economic, foreign and security interests. The change coincided with publication of China’s first Arctic policy strategy in January 2018, which stated that the region is playing an increasingly global role. It’s due to the global consequences of climate change, as well as growing of the Arctic’s strategic and economic position. All these factors justify China’s more active and multidimensional policy in this region of the world: economic (“Polar Silk Road”), foreign (activity in regional organizations) and military (establishment of military bases, military exercises). Therefore, there has been a change in the very moderate policy to date, thanks to which China received in 2013 the observer status in the Arctic Council.

Today, China is one of the most important trading partners of Denmark and Norway. According to the UN Comtrade database, it is the eighth biggest importer of Danish exports, the value of which rose to USD 3.16 bln (2.9% of the total) in 2018 and the fourth largest goods provider to Denmark (USD 7.21 bln, 7.1%). In the same period, China was the tenth largest importer of Norwegian export (USD 2.58 bln, 2.1% of the total) and the third most important exporter to Norway (USD 8.78 bln, 10%). It is also important, that in recent years (compared to 2009), the mutual trading is characterized by an increase of over 40% (Denmark) and almost 55% (Norway). However, both countries have recognized that in the case of China, trade interests are often associated with security issues. As a result, Chinese entities were not allowed to invest at Greenland and the Huawei’s offers to build a 5G network were also rejected (telecom operators in both states had picked Sweden’s Ericsson).

Revision of strategies and defence plans of Denmark and Norway. All political forces in Denmark supported the government’s plan to increase defence spending from USD 3.8 bln in 2017 to USD 6.3 bln in 2023 (in 2019 defence spending accounted for 1.32% of GDP). Despite nominally enormous growth – over 65% – this expenditure will account for around 1.5% of GDP, therefore still below the 2014 Allies commitment. In the light of the deteriorating security environment, particular importance is given to the strengthening deterrence (joint defence cooperation agreement of the Nordic countries of April 2015) and protection against cyber-attacks (based on the Danish National Cyber and Information Security Strategy of December 2014). Denmark’s armed forces must also be ready to support civil authorities in matters of national security. Therefore, the vast bulk of the funding is allocated to investments in new technologies (the decision to purchase 27 F-35 fighters). In addition, it is planned to establish a heavy brigade equipped with ground-based air-defence capabilities and a light infantry battalion to support the police in patrolling and security missions.

Norway is currently spending about 1.8% of GDP on defence spending (less than NOK 59 bln in 2019), and plans to slightly increase its defence expenditures to NOK 61 bln in 2020 (USD 6.6 bln). This is in line with the Long Term Defence Plan for 2017–2020, adopted by the Norwegian parliament, the Storting, in November 2016. Norway will not reach the goal of contributing 2% of GDP towards defence spending by 2024 (Norway would have to allocate an additional NOK 25 bln, compared to the 2020 budget, to achieve this goal). Moreover, this plan highlighted the need for a long-term investment to ensure that the armed forces will be well-prepared to respond effectively to new security challenges, especially in the immediate vicinity of the High North. The plan also emphasizes that, in the long run, Norway needs to obtain new, and therefore more advanced, weapon systems (F-35 fighters, 4 new submarines), to improve its combat readiness, logistics support and combat support services (maintenance of a compulsory conscription), as well as to increase its involvement for the maintenance of the US forces (rotational presence).

Conclusions. Denmark and Norway have different security and defence priorities than Poland and the Baltic States. Therefore, they do not perceive the position of certain NATO states (e.g. France, Turkey) or the recent discussion within NATO (more about that: “IEŚ Commentaries”, No. 97) as a threat to the security of the eastern flank of NATO and the BSR. Although both states will maintain their commitment to the NATO’s eFP, the Arctic and the ongoing competition of global powers are playing an increasingly important role for them. This is due to the growing importance of China as a global power that is increasingly shaping the international order, which is a huge challenge for small states. A long-term effect of this process might be a relative decline in the importance of the NATO’s eastern flank and the BSR security for both states. This process is accompanied by a growing importance of the NATO’s 360-degree approach. It stresses the importance of a “multidirectional threats” approach, which is stated that not only Russia is a problem for NATO (but also, for example, China, international terrorism, or the situation in the Middle East).

Rail Baltica Slows Down – Problems Growing Around the Investment (Aleksandra Kuczyńska-Zonik)

From idea to implementation. Rail Baltica (RB) is the largest Baltic-region infrastructure project in the last 100 years. For the first time, the idea for the project appeared in the 1990s during Pan-European transport conferences in Prague, Crete and Helsinki. In 1994, the concept appeared in the joint policy document “Vision and Strategies around the Baltic Sea 2010” as an important element for spatial development in the Baltic Sea region, and in 2003 in the list of priority projects in the proposal submitted to the European Council by the European Commission. Finally, in 2008, the European Commission decided onTrans-European Transport Network (TEN-T) co-financing for Latvian, Lithuanian and Estonian projects. October 28, 2014, the three Baltic Prime Ministers signed the Joint Statement in Riga and the RB Rail AS was established,which is responsible for the implementation of RB. The national shareholders are Rail Baltic Estonia (Estonia), Eiropas Dzelzceļa līnijas (Latvia) as well as Rail Baltica statyba and Lietuvos geležinkeliai (Lithuania).

Modern, safe and environmentally friendly. RB is a new, fast, double-track electrified railway line with maximum design speed of 249 km/h for passenger trains and 120 km/h for freight trains, on the route from Tallinn through Pärnu – Rīga – Panevėžys – Kaunas to the Lithuanian-Polish border, with a connection from Kaunas to Vilnius (213 km – Estonia; 265 km – Latvia; 392 km – Lithuania; total – 870 km). Today most rail freight traffic transported by railway in the Baltic states originates from CIS countries, in particular from Russia, using the existing 1520 mm gauge system which, makes it difficult to interconnect the region with the rest of the EU states via Poland (most EU states have the 1435 mm gauge system). The project will ensure the integration of Lithuania, Latvia and Estonia in the homogeneous European rail network. RB will be fully electrified and built using the most up-to-date technologies and materials. The line is planned so that it avoids the Natura 2000 protected areas as far as possible and without significant impact on other environmentally sensitive protected areas. Wherever necessary, noise protection barriers will be installed and special animal passages will be built through the embankment. RB will conveniently connect airports, road network, and a system of new and rebuilt stations will facilitate the access to rail services for passengers.

The total estimated construction cost of the project is 5.788 billion euro. The implementation of the project is financed by Estonia, Latvia and Lithuania, and co-funded from the European Union up to 85% of the total eligible costs, in particular in the framework of the Connecting Europe Facility (CEF) funding instrument. So far, three Baltic states have received three grants of a total value of 824 million euro (Estonia – 235 million euro; Latvia – 303 million euro; Lithuania – 286 million euro).

Deadlines missed. According to the project timeline, the RB construction works started in 2019 (the construction phase should be implemented in 2019–2026), but it is already known that it will be difficult to meet the assumed deadline. According to the most pessimistic scenario, the RB implementation may be completed as late as 2030. In December 2019, the findings from the audit of the RB project implementation were presented. The joint audit, conducted by state control institutions of Lithuania, Latvia and Estonia, has revealed a number of the project management, scheduling and budget risks. The published report has indicated that some activities of the project are several months behind the schedule agreed in the funding agreements. As a result, the total costs of the existing contracts have increased by several dozen million euro, mainly due to the project expenditure growth in Latvia and Estonia. In addition, the audit has unveiled many difficulties in mutual cooperation, conflicts of interest between the RB Rail shareholders (including the infrastructure management model in the future), a lack of an effective decision-making mechanism at different stages of the implementation of the project, as well as the inability to solve deadlock situations when the beneficiaries could not agree on a common solution. The Baltic states have had different visions for the project governance and infrastructure management. Additionally, the Baltic states have been criticized because none of them has officially approved plans for re-financing in case project costs increase or if the EU funding turns out lower than planned. The audit recommends to eliminate irregularities and to develop more effective procedures for the implementation of the project.

More and more doubts. The report highlights the reasons for the RB implementation delays. Undoubtedly, they resulted from the problems of the real estate alienation process, particularly in Latvia and Estonia, where the expropriation process is protracted and more complicated. There have also been doubts whether the project corresponds with the local development plans in Latvia. Moreover, the investment was criticized by the landowners of the properties along the RB planned route, and the environmentalists according to whom the environmental and social costs would exceed the expected benefits of the project. There have also been doubts whether the investment is economically rational, and whether the existing communication routes could be used for the potential transport services in the future. Social resistance towards the implementation of the project was the most evident in Estonia, where voluntary groups opposed to the project and have been organizing numerous protests and demonstrations (among the most active group was Avalikult Rail Balticust – ARB). According to public opinion polls conducted in December 2019, only 22% of the Estonian respondents are in favour of a new RB route accepted by the government, while 18% are totally opposed. The latter would prefer modernisation of the existing rail networks. Latvia and Lithuania have not seen massive social protests against the RB, as the problems resulted from the insufficiency of the real estate alienation process and compensation for the landowners.

Efficiency and effectiveness of the investment implementation were also limited by changes in the management board. They resulted mostly from the replacement of high-rank officials as well as management board members. At the end of October 2019, RB employees sent a joint statement to the offices of the Baltic transport ministries, requesting immediate action because of the structural and organizational problems of the investment. They indicated “a critical situation” due to a conflict of interests, a lack of coordination of the project between public and private sectors on a national and regional level, as well as a lack of the inter-sectoral cooperation.

A particularly worrisome dispute arouse on political issues of the investment. Shareholders in Latvia and Estonia have blamed the Lithuanian partner for the project delays. At the same time, the mainstream political parties in Estonia – Isamaa and EKRE – which form a coalition government have expressed low enthusiasm about the RB project from the very beginning. During the coalition talks, Mart Helme, the EKRE chairman, already indicated that he was looking for ways to stop the RB by examining the economic substantiation of the project, the impact on the environment or by the RB route change. Instead, he offers the modernization of the existing railway routes in Estonia.

Conclusions. Lithuania, Latvia and Estonia may derive many economic and social benefits from the RB investment. Local development plans provide many additional convenient connections, including safe communication from train stations to city centres. In addition, the Baltic states expect other economic benefits, such as: the real estate development, attractive jobs, urban areas revitalization, technology and innovation transfer, tourism development, and others. RB shall strengthen the synergies between North-South and West-East freight flows, creating new trans-shipment and logistics development opportunities along the European trade routes. Furthermore, thanks to the project of a railway tunnel between Tallinn and Helsinki, the RB would contribute to a possible link between Europe and Asia via the Northern Sea Route (“IEŚ Commentaries”, No. 103). Although Finland decided to be involved in the RB project (February, 2019, a company Oy Suomen Rata AB was established), the cooperation between Finland and the Baltic states has slowed down recently. Broadly speaking, the RB is a project of a new economic corridor that may contribute to regional and global integration. Poland – as the centre of the new communication system – may become one of the main beneficiaries of its investments.

Lithuania, Latvia and Estonia confirm that their hitherto failures should not overshadow their common goal, and the losses should be minimized. Joint energy projects (gas connections) between the Baltic states exemplify the success of cooperation among them, and further projects are planned (an off-shore wind farm). According to the RB implementation, Lithuania, Latvia and Estonia announced the continuation of negotiations for a more efficient management system. During a meeting of the Baltic Council of Ministers as well as the transport ministers of Lithuania, Latvia and Estonia on 7 February 2020, the participants declared to move forward with the implementation of the RB railway, saying it would be ready by 2026. At the moment, the Baltic states have stressed the need to improve the structure and security management, new tax solutions, proper regulations for tender process, and the ownership structure. From the Baltic perspective, it is important to secure the RB investment to be included into the next EU 2021–2027 budget, when the most active the RB construction works will be taking place. Lithuania, Latvia and Estonia should support the investment more intensely in order to protect the project implementation from the delays and, ultimately, from the limitation of the EU funding.