Baltic Sea is one of the most heavily trafficked seas in the world. To put simply, it is a connecting point for all countries lying on the shores of it. In Estonia, the Baltic Sea has always been a highway for trade and we have been active in logistics since the Viking era and later as an active member of the Hanseatic League what dominated Baltic maritime trade for three centuries. Looking at the logistics it seems that we have always been connection between East and West, especially connecting Russia and Western-Europe.
Project
Baltic Loop has defined a middle corridor that stretches from Oslo-Örebro-Stockholm
to Tallinn-St. Petersburg. While we have regular connections between Sweden and
Estonia, the usual trade and logistics routes seem not to use the full potential
of Estonian geographical position and historic reputation as traders between
East and West.
Business Development manager of Estonian Railways Ltd, Arthur Raichmann, believes that there are several unused opportunities for Scandinavian trade.
“A large number of freight corridors have been built in the Baltics to move freight to Asia. These were mainly used during the Gulf War, when the entire US military supply line ran along the railways (Afghanistan, Iran, etc.). There is no more demand for these corridors today,” he says.
Scandinavian trade with Europe is done mostly by sea. The main export sectors of Finland and Sweden are paper and wood products, which do not travel by rail towards Europe. Goods are mainly transported by sea to Hamburg-Rotterdam and moved on from there by rail. There are some initiatives to challenge current models as the EU has defined a number of Ten-T rail networks. RFC 8 (Rail Freight Corridor) is the one connecting the core of the EU to Tallinn.
Estonian Railways have conducted a study on trade between Scandinavia and China. Sweden and Denmark have the largest volumes of goods, but today there is no trade by rail. The potential was addressed in TransEstonia 2020 conference, where the intention was to find a potential Swedish-Chinese freight corridor.
However, the issue is never as simple as just defining the corridors and getting the freight. “Developed supply chains are important and do not tend to change easily,” explains Raichmann, “. Change the done when something is not working properly. In this business, change is slow and trust plays an important role.”
From the perspective of Estonian Railways more or less all of our transit freight is connected to our great neighbor since more than 80% of all flows on the Estonian railway come from Russia. More than half of these volumes are different fertilizers or similar products. This creates some delicate issues as in some cases these dangerous goods are traveling via Tallinn city center towards Paldiski ports. Hele-Mai Metsal, Head of Development Department in the Port of Tallinn (the company that owns and operates in Paldiski South Harbour) notes that the rail capacity is limited (possible only at night time in Tallinn) and noise is disturbing the city residents. So all in all dangerous goods, heavy freight trains at night, and Tallinn residential areas do not match too well. This is why missing the Tallinn bypass railway connection is one of the bottlenecks that stands out.
Coming back to the trade, the unused potential is quite large due to political reasons.
“To describe the situation, it can be said that all corridors that reach Estonia come from Russia,” says Raichmann. The negotiations to get a competitive price for railway sections in Russia are difficult and Russian national interests are supporting ports of Ust-Luga and Kaliningrad.
The solutions more-or-less seem to rely on diplomacy. This combined with a push from a powerful market force like Finnish – Swedish timber industry can hopefully hand the key to unlock the Russian transit market, hopes Raichmann. It is questionable if this could bring back the heyday akin to Russian crude-oil transit through Estonia, but the capacity of Estonian ports and railway could be in much better use.
The project BALTIC LOOP seeks to minimize the impact and number of different traffic hindrances or bottlenecks in three selected transport corridors running in the West-East direction within the Central Baltic Region, namely Örebro -Turku/Tallinn/Riga -St. Petersburg. The overall aim is to minimize travelling and cargo transport times in the corridors, and reduce CO2 emissions.
For Åbo Akademi University and Finland much of the optimisation input focuses on finding business models that improve the efficiency of shipping and ports.
The Baltic Sea region forms a financially, politically and sociologically integrated, stable area. The population in the region amounts to approximately 100 million, but the geography of Europe’s north-eastern corner disperses its inhabitants across a large area, characterised by long transport distances. The economies in the region are growing, which entails increased traffic volumes, and this, in turn, necessitates flexibility and new approaches in the planning and development processes of transport systems and regulations. Thanks to increased environmental awareness and EU directives, greener solutions will be implemented when planning for future smooth transport networks at local, regional, and national levels.
According to the researchers in the Baltic Loop project, coordinated by Turku University of Applied Sciences, an advanced, well-functioning transport network is necessary for guaranteeing continued well-being, growth, and development in the region.
The Baltic Loop project focuses on improving the transport flows of both people and goods in three selected corridors running in a west-east direction.
“It’s about long-term planning and development of the transport systems and infrastructure in the transport corridors. One part aims at identifying existing bottlenecks and studying future transport needs, for both people and goods. Another part is to work on accessibility and improved connections between transport nodes. Yet another additional aspect is to consider balanced and co-ordinated land use when planning housing and traffic infrastructure,“ says Irina Wahlström, project manager for Baltic Loop at Åbo Akademi University, one of the project’s seven partners.
The starting
point for the three horizontal corridors is Örebro in Sweden.
• The northern
corridor: Örebro – Turku (Finland) – St. Petersburg (Russia).
• The middle
corridor: Örebro – Tallinn (Estonia) – St. Petersburg.
• The southern
corridor: Örebro – Riga (Latvia) – St. Petersburg.
Åbo Akademi University is represented in the Baltic Loop by the Laboratory of Industrial Management. The Baltic Loop seeks to present alternative solutions for minimising the impact and the number of obstacles in traffic flows. This would minimise traveling and transport times and reduce CO2 emissions considerably. The basic idea is that smooth corridors with shortened transport times would have a positive effect on the establishment of new enterprises and the creation of innovations along the corridors.
Åbo Akademi is mainly focusing on alternative business solutions and models for smart and sustainable shipping logistics and port operations. Shipping and ports form central links in the logistics and transport chains, and function as important transport nodes in the west-east corridors.
“Sea transportation is, in essence, both international and connecting, but inefficient by nature. Entrenched mindsets and lack of communication, among other things, lead to ineffective capacity utilisation and poor co-ordination of shipments. I had to develop an understanding of how transport flows in Sweden look and how they will look in the future, with an emphasis on the Örebro and Stockholm axis. And, I also looked at how these land-based flows are forwarded through the ports on Sweden’s east coast to other regions and countries in the project. The heavily populated and economically important Stockholm-Mälar region is expected to increase by 1.4 million people and 700,000 jobs by the year 2050,” says Wahlström.
The appearance of bottlenecks may depend on a variety of factors, such as inadequate planning and communication on land use between actors concerned. Lack of capacity and maintenance, can result in traffic jams, delays, and accidents within all forms of transport.
“In order to overcome, for example, problems with capacity, we have recently seen a move toward larger transportation units, equipage and vessels -in other words larger volumes of goods are being transported more energy- efficiently over longer distances, thus resulting in a lower environmental impact. But, this essentially means that other parts of the infrastructure must adapt to this trend, such as by increasing the capacity of the road network, dredging deeper fairways or extending the length of berths in ports” says Wahlström.
Örebro is a city with 150,000 inhabitants. It is located on the western shore of Lake Hjälmaren. To the east is Lake Mälaren and the city of Stockholm is located on its eastern shore. The European route E20 connects Örebro with Gothenburg in southwestern Sweden and the E18 with Oslo in Norway. Örebro was chosen as the starting point for the Baltic Loop corridors due to its central location with regard to the east-west transport flows across the region, and the Scandinavian-Mediterranean TEN-T core network corridor stretching through Sweden. However, the region today is only a partially interconnected residential, education and labour market region, which is why the planning of a functional transportation system is important, even from a cross-border perspective. The region’s rapid growth in population is putting a significant amount of strain on the transportation system, which cannot currently keep up with the increased demand.
“In Sweden, the transport system is planned for the long term – a 12-year plan is used. Generally speaking, they take a longer view than we do in Finland. The latest national plan for the transport system in Sweden will run until 2029 and it presents specified measures, priorities and investments in the transportation infrastructure. The state planning framework has a budget of 622.5 billion Swedish crowns and focuses primarily on the development of railway capacity, shipping and roadway infrastructure. A large number of actors, including at the regional level, are involved during the planning process before the plan for the transportation system is finalised. I’m impressed by Sweden. They have a very good internal dialogue,” says Wahlström.
“In Finland, we have so far not had the same long-term perspective in traffic planning. This can be seen in, for instance, the traffic to and from the West Harbour in Helsinki. But fortunately, Finland is following Sweden’s lead in this case and has started preparing a long-term transport system plan, which includes all transport modes and will be the basis for the future development of Finland’s transport network and services in the period 2021–2032. In Finland, we haven’t so far taken the same kind of long-term view when it comes to transport planning. This is readily apparent in, for example, how traffic arriving at and departing from the West Harbour in Helsinki has been set up. Fortunately, Finland is also following Sweden’s lead in this regard, with Finland launching preparations for a long-term transportation system plan, which encompasses all modes of transportation and provides the basis for Finland’s transportation network and services from 2021 to 2032”.
Trans-European transport networks
Sweden and Finland are traversed by the Scandinavian-Mediterranean TEN-T core network corridor. TEN-T is short for Trans-European Transport Network, which is a European mega project, initiated in the 1980s aiming at maximising the logistical seamlessness of goods and passenger transports through Europe. All in all, nine Core Network Corridors pass through Europe.
“The horizontal corridors are not as well-developed as those in the north-south direction. But, the north-south corridors aren’t entirely ready, either. Central Europe, is in general, a region plagued by capacity problems which take the form of traffic congestions and traffic jams. A cross-border tunnel is currently being dug in the Alpine Region, and the rail and road transport capacity between Germany and Denmark will also be expanded,” says Wahlström.
“A consequence of this often is that, when capacity is increased, the traffic volumes will likewise increase. But, in most cases, traffic runs more smoothly when there is more capacity.”
Climate issues
Both at the global and EU level, climate issues have become a central concern for operations, and this also pertains to the shipping sector. Ports and sea logistics are extremely important for Finland; 90 percent of all goods are imported and exported by sea.
“In order for us to be competitive, we must be logistically efficient. As to shipping to and from Finland, there is often an imbalance between import and export transports due to exclusive confidential transport agreements between industrial cargo providers and transporters, or because of a failure to find a suitable return shipments. This results in empty transports and causes unnecessary CO2 emissions.”
The situation could be improved by better co-ordination of freight flows and enhanced information exchange and transparency between various actors and authorities concerned.
As things stand now, different parts of the transport and supply chains do not communicate with each other optimally. Many ports lack a slot system that would allow an advance booking of the port call and associated loading and unloading procedures. Consequently, vessels cannot optimise their speed to ensure just-in-time port arrivals or coordinate with the ports for timely port services, but rather rush during the voyage because of the first come, first served allocation principle many ports apply. Many times this leads to a situation where queues are formed and vessels wait up to several days outside the port idle, waiting for the permission to berth.
“However, things are admittedly progressing within shipping as well, but improvements in openness and coordination are still needed.”
Another development that will lead to changes is the requirements for lower emissions and the optimisation of ship energy efficiency. At present, shipping produces approximately 3% of the world’s carbon dioxide emissions. However, it must be acknowledged that shipping is an energy-efficient way of transporting goods over long distances.
“We should prepare ourselves for considerable growth in transport volumes. This is due to, for example, increased trade, digital shopping channels, changed consumer behavior, alternative door-to-door and last mile deliveries. This is something we see particularly in urban areas. The trend toward smaller order sizes and more frequent deliveries leads to an increased need of accessibility and flexibility in the transport system.”
“What we’ll have to find is smarter ways of organizing and arranging these traffic and goods flows, that is, we must find more energy efficient and ecological ways of setting this up.“
The transport systems are being digitalised, automatised and electrified at an increasing pace, which may provide instruments and solutions for reaching climate targets. These smart transport systems, where vehicles, vessels, goods and the infrastructure communicate with each other, makes it possible to achieve better energy efficiency within shipping, by means of route optimisation, slower cruising speed and optimisation of port calls, among other things. Platooning is a solution where multiple trucks form a ‘train-like’ convoy of unmanned vehicles, which communicate with each other through a manned ‘lead’ truck. The development of autonomous vehicles and vessels and the attendant regulatory framework is also part of this equation.
“At the EU level, the ambition is to continually reduce road transports towards other more environmentally friendly modes of transport including railway and sea transportation. This particularly pertains to industrial goods and large volumes. But when it comes to consumer goods, these are bound to continue rolling mostly on the roads.”
Within the Baltic Loop project, the Laboratory of Industrial Management at Åbo Akademi University is exploring smart and sustainable business models for shipping and port operations.
Irina Wahlström has been a project manager at the Laboratory of Industrial Management at Åbo Akademi University since 2017. She has completed a Master’s degree in biochemistry followed by a Master of Business Administration in shipping in London. She has worked her entire professional career within the shipping sector, in operations, consultancy and project management, both in Finland and abroad.
In the framework of the Baltic Loop project, Ahmed Alaeddine and Fredrik Idevall participated in the conference TRANSESTONIA. The main goal of the conference is to discuss and reach agreements on further transport development between China and Sweden via Kazakhstan, Russia, and Estonia. Delegates from all countries were represented.
Since ancient times, Estonia has been an important gateway between the Nordic countries in Scandinavia and the east. The Baltic countries are the beginning of the eastern trade route that connected to the Silk Road in Persia. There are again thoughts on using this old trade route. Modern rail systems with train commutes provide fast, reliable, and safe transport.
Today,
there are a number of train commutes between China and Sweden. The usual
transport arrangement is via shipping where the port of Gothenburg receives the
goods, which then continues on land by road or rail. Another arrangement is that
transport from China is unloaded in one of Europe’s major ports to continue the
road to Sweden.
What TRANSESTONIA wants to achieve is that the goods are transported by rail between the countries of China, Kazakhstan, Russia, Estonia, and then via sea to Sweden. There are major temporal and environmental benefits to working for a transfer from shipping and aviation to rail. Today it takes about 12 days to transport goods from China to Sweden by train, while the figure for sea shipping is 40 days, says Ahmed Alaeddine, one of the project managers of the EU project Baltic Loop.
Maritime transport is by far the most dominant mode of transport for goods between China and Europe. The share of maritime transport amounts to as much as 94% compared with the railway’s market share of only 1%.
The railway has a huge potential to take market shares from maritime transport. It is both a faster and more sustainable mode of transport. One explanation for the low market share is that China has not previously marketed and subsidized rail traffic, says Ahmed Alaeddine.
The region of Örebro County is following with interest the work of improving the railroad between the countries from Sweden to China. The development of an improved railway between these countries is good for the Baltic countries such as Estonia, Latvia, Lithuania, and Scandinavian countries such as Sweden, Finland, and Norway as the conditions for the exchange of goods become simpler and faster while we make a greener transition. The problem now is to be able to fill the train carts that are going back to China with export goods.
Sweden imports more from China than we export. We need a balanced exchange trade between the countries in order to achieve filled train carriages in both directions and that the region’s companies choose the train as a mode of transport. Today, about 30 percent of the wagons from Europe go back empty to China. A more balanced trade is a way to further improve the conditions for good rail traffic, says project manager Ahmed Alaeddine.
Train
commutes between Europe and Asia are becoming more and more a reality. It is
now up to the Swedish business community to make the best use of this
opportunity.
With the increase in cargo volume nowadays, the demand for physical infrastructure might increase. However, the overall efficiency could also be improved by employing digital infrastructure and communication methods during cargo transportation. The main idea is to achieve the maximum utilization rate of the available infrastructure, technology, and other kinds of resources. Together with a collaborative environment, it will be possible to reduce transport emissions in our corridors and result in efficient transportation.
This time it is a must-read because the results of the questionnaire for stakeholders related to freight and passenger transport are summarized and you are welcome to introduce yourself with the main findings. These are very important conclusions that will help to achieve the goals of the project more efficiently, as the situation has been evaluated by the industry.
The thematic questionnaire was conducted to meet the following objectives:
evaluating transportation services and operations on selected corridors;
identifying main hindrances and drivers for smooth transport flows;
highlighting areas where improvements for more efficient traffic are needed.
If you would like to see the full version of the survey report, don`t hesitate to contact us!
On March 5 2020, the Riga Planning Region brought together stakeholders from the transport industry to find solutions for sustainable urban mobility and better quality of life in and around cities. It is acknowledged that the players in the industry are the same, so resources must be pooled and used wisely. The forces were combined with the Interreg Baltic Sea region project SUMBA to present news in the sector and invite them to participate in working groups to discuss the development of various issues.
Thematic directions of the working groups were:
SUMP understanding and governance model,
Infrastructure development and technical solutions,
Change of commuting habits.
The audience included experts and professionals of the industry and municipalities, as well as representatives of the ministries and coordinating bodies.
It is important to bring together people at all levels – local, regional and national and to integrate it all into an internationally coordinated set of new solutions.
On January 22, an international stakeholder meeting was
organized in Riga, during which interested persons could get acquainted with
Latvia’s national strategy on transport development, as well as see the close
connection between national and international goals and initiatives that could
help to achieve them. Presenters included both domestic and foreign experts.
Presenting the Latvian Transport Development Guidelines 2027, Inta Rozenšteine of the Ministry of Transport of the Republic of Latvia acknowledged that
“projects such as the Baltic Loop are very important for the policy implementation on national level.”
She also looks forward to contributing to the Baltic Loop.
RB Rail Latvia spokesman Ģirts Braman introduced the objectives of the major cross-border project and how far it has gone.
He encouraged projects to use the opportunity and share relevant information and data.
“No project, even on a scale like Rail Baltica, will be effective unless synergies are sought.” Mr Braman said he was very interested in what the results of the Baltic Loop project would be and saw that they could be important for the transport industry as a whole.
Representatives from Finland also shared their solutions for
traffic facilitation, presenting the concept of Mobility as service and virtual
queuing GoSwift.
An interesting panel discussion highlighted a number of key issues, such as the role of the public sector in promoting innovation; the extent to which we are prepared to work on common standards that allow solutions to cross borders rather than stop at them. The audience also remarked that the development of multi-modal points removes their accessibility in sparsely populated areas, in fact having the opposite effect.
A strong but true statement came from the hall: “The
world is full of strategies, but what about the practical implementation of
theory?”
After a fruitful discussion, the participants went on an
exchange of experience to the Adazi municipality and Skulte port.
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