The Rail Baltica Global Cost-Benefit Analysis (CBA) presented on April 24 during Rail Baltica Global Forum 2017 confirms that the Rail Baltica project is financially and economically viable. The new study reaffirms the project’s economic feasibility and highly beneficial nature, providing the necessary updated parameters for the project’s continued EU and national co-financing.
According to the study prepared by Ernst & Young Baltic, the total estimated cost of the project is EUR 5.8 billion in all three countries, of which in Estonia the project was valuated at EUR 1.35 billion with a national share of EUR 268 million, in Latvia the project cost is EUR 1.97 billion with a national share of EUR 393 million and in Lithuania, EUR 2.47 billion, with a national share of EUR 493 million.
Measurable project socio-economic benefits, estimated at EUR 16.2 billion, will far outweigh national co-investments. Furthermore, it is assessed that the project would create a GDP multiplier effect worth an additional EUR 2 billion. In addition, there will be substantial unmeasurable benefits (mostly of a catalytic nature). There will be considerable unmeasurable benefits from a strengthened Baltic business community to greater regional access to entertainment, culture or other services. Therefore, the project is economically viable, as the benefits to society considerably exceed project capital and operational expenditures.
On average, Rail Baltica will generate measurable discounted net benefits/cash flow worth EUR 6 to the wider economies of the three Baltic states for every invested euro from national budgets.
In 2030, it is estimated that infrastructure maintenance costs for the entire railway line in all three countries, for example, for track, traction, bridges/tunnels, terminals and stations, etc. will be EUR 58.9 million.
The study also verifies that the infrastructure manager is financially sustainable in the long-term, following an initial 5-year period of national financial support (EUR 28.6 million shared by the three Baltic states) during the project uptake stage as Rail Baltica achieves its intended potential.
Share on:
