“If we look at the east, we have to look past Russia’s borders. The east doesn’t begin and end with Russia. The Central Asian countries are highly important for Latvia and the rest of the European Union (EU),” said council member of Latvian Stevedoring Company Association Jānis Kasalis in an interview to Latvijas Radio 4 – Doma laukums.
According to him, we have to decide what the term “grains” means, because statistics show a general digit that includes various types of grains. “Transit of Russian grains through Latvian sea ports has reached 1.3 million tonnes in 11 months. As for import – it has reached 330 000 – 340 000 tonnes. When it comes to transit of Russian grains, the volume is much larger, whereas import volumes are slightly larger when compared to a couple of years ago. If we compare this to the volume of exported Russian grains, which is measured in 40 – 50 million tonnes – this is a very insignificant volume,” says Kasalis.
Latvian Stevedoring Company Association’s council member stresses that grain products carried using Latvian railway network account for 20-25% of all freight. “Latvia’s railway network is a very important part of our country’s transit and transport sector. Without the railway there is no local, domestic transport or transit operations to many other countries. As for the state of financial crisis of Latvian railway has been a couple of years before the war, these 25% may very well become the last 25% preventing more than 5 000 people from becoming jobless. As for sea ports, these two million tonnes are slightly below 10% of the total volume handled by large sea ports,” stresses Kasalis.
According to him, it may seem like a small volume, but because the volume of freight handled by sea ports has declined by an average of 10% in the last five years, this means the three or four terminals in Riga, Liepaja and Ventspils risk ending up without work, port companies risk losing employees, and the state budget risks losing tax revenue from this sector.
Large EU countries are not prepared to clearly say they are ceasing imports from Russia. We’re talking about import, not transit.
We will find out what those countries are thinking in January, when the EU vote is expected. Still, right now we can assume large countries will not agree to cease importing goods from Russia, said Kasalis.
“Since the start of the war our association has been against it. There is no reason to think we will look at this situation differently. We are not in any way prepared to support the war. I believe we can help end the war with our taxes and the people we employ and who pay taxes and help Ukraine in the war,” stresses Kasalis, adding that customs and services that check everything would definitely halt suspicious goods in transit if they suspect they are “bloody”. He says politicians have all the necessary tools to check where those goods are delivered and whether they remain in Latvia. “We’re currently doing what is permitted by Europe,” stresses Kasalis. “Latvia handles both imports of Ukrainian grains and their transit, but numbers are very small. When it comes to import, the volume is 150 000 tonnes, whereas transit volumes reach 140 000 – 150 000 tonnes.”
Latvian Stevedoring Company Association previously released an announcement in which the organisation invites the government to not use sanctions on transit of grain from Russia to sabotage the country’s economy and not destroy the entire transit sector, the state-owned company Latvian Railway (LDz), as well as create new thousands of unemployed people. At the same time, the association stresses that by doing so the Latvian government would provide an opportunity for the development and growth of Russian ports and economy.
Transit of grain is a substantial part of Latvia’s economy. Sea ports and the railway network are equally involved in transit operations. Latvia has three large sea ports that handle grain transit operations. The overall capacity of terminals handling grain shipments exceeds ten million tonnes. An average of three million tonnes of Baltic grains is exported every year. This capacity also provides for exports of another seven million tonnes, as reported by Latvian Stevedoring Company Association.
“Without additional transit volumes, some of Latvia’s currently operating terminals will not be able to survive. 800-900 people are employed in those terminals. Employees of shipping companies, brokers, surveyors also work at terminals. The total number of people employed at sea port transit points in Latvia exceeds 1 000,” stresses Latvian Stevedoring Company Association’s council member Jānis Kasalis.
Grains account for more than 20% of freight carried by LDz. “The total volume of freight freight carried by the company has already dropped by 15-20% over the course of the year. An even bigger drop may turn out critical for the company,” warns Kasalis.
The number of employees in LDz has gone down by more than 40% in the past five years. The ban on carrying Russian grains would put more than 7 000 remaining jobs at risk.
If Latvia decides to limit the transit of grains, Russia will simply use other corridors. It’s also important to remember that the grains carried by railway do not remain in Latvia. They are carried to other countries. Through Europe grains are carried to poor African countries: Somalia, Mali and Nigeria.
“We also have to keep in mind that without transit of grain through Latvia, money will remain in Russia’s hands, to be used freely to reinforce the aggressor country’s economy and fuel the war machine. Vysotsk and Ust-Luga are the most rapidly growing ports in the region. They have modern grain-handling terminals. For example, Vysotsk terminal’s capacity is four million tonnes a year. If grains don’t go through Latvia or Europe – Russian ports will profit,” says Jānis Kasalis, adding that “grains are not at all what composes Russia’s economy. In order for the aggressor to feel consequences from sanctions, we need an absolute blockade, because more than 70% of Russia’s exports consist of hydrocarbons (gas, oil, ect.).”
There have to be anti-Russian sanctions, but we also have to understand that if the sanctions are too draconic, we cannot allow them to impact our own economy. Grain transit is not the biggest problem – failure to deliver them to countries of the African continent could lead to a famine and cause a new wave of migrants to Europe. The most effective method would be to ruin the aggressor country’s economy by completely isolating it from the rest of the world, which requires global involvement from the most influential countries of the world, LSA reports.
Also read: BNN INTERVIEW | Filips Rajevskis: Latvian corridor will be closed, but there will be other roads. This is not the way to weaken Russia
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