Kaliningrad Transit: Achievements and perspectives

Authors:

Gerhard Lohan

Back in November 2002 the EU and Russia laid the ground, by way of a joint statement adopted at the highest possible level, for the transit of persons between the Kaliningrad region and mainland Russia. It involves the use of “facilitated travel documents” and has operated to the entire satisfaction of all sides ever since it was put into effect in July 2003. On average, 1.5 million persons travel annually to/from Kaliningrad and so far only relatively few had to be refused at the border or taken off the transit trains.

     Transit of goods was covered in a joint statement adopted in April 2004 in connection with the transit countries’ accession to the EU. The basic principles of freedom of transit
without unnecessary delays or restrictions, and the exemption from customs duties and transit duties were confirmed in accordance with the related GATT rules and those of the EU-Russia Partnership and Cooperation Agreement (PCA). While generally aiming at keeping the cost of transit as low as possible, a clear distinction was made between private sector services which will be provided under fair competitive and market-based conditions and administrative costs which fall under the responsibility of government authorities and which need to be proportional and cost-related. The statement also aims at simplified administrative procedures by which Russian transit declarations can be submitted directly to the New Computerized Transit System (NCTS) in Lithuania.
     Issues related to the specific customs procedures have been fully settled. However, transit of goods also involves a variety of other controls which are partly product-specific such as phyto-sanitary inspections, for example. Both sides have addressed such matters under the auspices of the PCA, also involving the Lithuanian and Polish authorities who are in charge of practical arrangements on the ground.

Impressive growth rates in transit flows in both directions to and from Kaliningrad during the last two years witness to the fact that EU enlargement did not create obstacles to transit. Overall, therefore, the necessary adaptations in the transit regime to the EU enlargement have been made successfully. We can now build on those achievements with a view to further supporting the social and economic development of the Kaliningrad region as called for by the April 2004 statement. Both sides can be confident about their ability to jointly find adequate solutions for any future Kaliningrad-related issues.

 

So what issues would be on the agenda in the future?

 

     Concerning travel of persons, the Visa Facilitation Agreement and the Readmission Agreement signed at the joint Summit meeting in Sochi last May have, for good reasons, received much attention on both sides. Visas will be easier to obtain and cheaper for Russian citizens living in Kaliningrad and in mainland Russia alike. Of course, EU citizens traveling to Kaliningrad will also get the benefit, thereby facilitating business contacts with the region and tourism. In case of illegal stay on the other side, the simplified procedure for return of such persons enshrined in the Readmission Agreement will be applicable around the Kaliningrad region. Lithuania’s and Poland’s accession to the Schengen area will in due course make it easier for Kaliningrad inhabitants to travel inside the EU. The EU Member States’ consulates in Kaliningrad, some of which have only recently been opened, will take the responsibility for issuing Schengen visas. If ever the cost of such visas were to go up, this would not automatically affect the Visa Facilitation Agreement because that agreement sets the cost explicitly itself.

The abolition of the visa requirement between the EU and Russia has been agreed at the May 2003 Summit in St. Petersburg as a shared long-term perspective. When it comes, it would probably make any transit regime unnecessary. Although technical talks have started, this will take a considerable amount of time and require further substantial reforms in Russia. Visa-free transit could not be achieved any earlier through a high-speed train connection to/from Kaliningrad: this would be incompatible with the EU principles. Thus, for this option to be rejected it did not even take the feasibility studies carried out in 2004 which demonstrated the lack of cost-effectiveness of building a high-speed train connection.
     Border crossing by persons to/from Kaliningrad could be made part of closer cooperation between the EU border management agency FRONTEX and the Russian Border Guard Service launched in early 2006.
     Concerning transit of goods, there are a number of factors other than customs procedures and inspections which also matter, given their potential for reducing overall transport time and cost. In particular, the capacity of border crossing points and transport infrastructure may be as important. The EU has made available substantial financial support for modernization of border crossing points such as Chernyshevskoze and Bagrationovsk and projects will soon start on Mamonovo and Sovetsk. More funds could follow once the new European Neighbourhood and Partnership Instrument (ENPI) would have replaced TACIS, starting in 2007. Support to infrastructure modernization in the Kaliningrad region should be seen in connection with the implementation of the Pan-European Transport Corridors two of which cross the Kaliningrad region. These were also included in the recommendations made in 2005 by the High Level Group on the extension of the major trans-European transport axes to the neighbouring countries and regions which was co-chaired by the former Commission Vice President de Palacio and the Russian Transport Minister Levitin.
     Railway cargo rates are another important factor influencing the cargo flows to/from Russia through Kaliningrad. The port of Kaliningrad is benefiting from rates which may unduly disadvantage other ports in the region. Russia’s accession to the WTO can provide the context and criteria for addressing such questions.
     Clearly, there are a number of other issues which together with transit determine the overall development prospects of Kaliningrad. The Commission has for some time advocated the need of a dialogue about those broader prospects. In February last, Commissioner Ferrero-Waldner visited Kaliningrad and had meetings there with Presidential Aide Yastrzhembsky and Governor Boos. The event opened a new phase of cooperation where transit and overall regional development objectives can be considered together with a view to maximizing the mutual benefit of further developments in Kaliningrad and in the Baltic Sea area at large.

http://www.tukkk.fi/pei/bre/BRE4_2006/expert_article51_42006.pdf