Ukraine loses a fifth of its port freight to Russian competition

By bne IntelliNews March 11, 2013

bne -

Competition in the transport sector appears to be heating up with Ukraine's announcement that it lost 20% of its freight business to Russian ports in 2012.

Kyiv is now looking for ways to replace the lost business as Russia continues to invest heavily in beefing up its transport infrastructure - an effort that will increase further in 2013. "We should conduct this analysis so that by the end of the quarter we could provide our boundary partners with proposals regarding the best possible ways to settle the issues that are preventing Ukraine from boosting transit freight," Ukrainian Infrastructure Minister Volodymyr Kozak said.

The Baltic countries are expecting to face similar losses this year as Russia increasingly directs freight through its own ports. In particular, Lithuania saw Russian freight handling go down by 21% last year and Estonia by 15%, the minister said.

Latvia saw its handling of Russian ore fall by 34% and of mineral fertilizers by 32%, yet due to a twofold increase in handling grain cargo Latvia managed to achieve a 3% overall rise in the amount of freight it handled.

"Today the major task for transit suppliers is not a rate or a fare, it's how convenient conditions are - it's what level of services we can offer for such freight. Here much depends not only on us, it's also about customs and other regulators, about the authorities," Kozak said.

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