As part of the tenth Connecting Europe Facility (CEF) round, the EU allocated 345 million to the Latvian Rail Baltica section. It now seems that the EU is reducing some of the allocated funds, and that the state will have to come up with more than 100 million euros.

In total, Rail Baltica was set to receive 1,2 billion euros from the CEF. Latvia stood to take 345 million euros of that amount. As per usual, the national government was expected to contribute 15 per cent of the financing at 61 million euros, according to Latvian media.

Now, it looks like the European Commission has decided not to finance particular projects that it has supported earlier. Supposedly, land expropriation and construction supervision will get no or reduced CEF funding.

An ill-considered move

“It is ill-considered to change the tendering rules regarding the activities of Rail Baltica”, the Latvian transport ministry comments. “The financing of these activities in full from the state budget imposes an unexpected burden on it.” According to Latvian publication Delfi, the government now needs to find 102 million euros to contribute to Rail Baltica.

The transport ministry also warns that a failure to secure such funding could lead to more financial problems in the future. EU institutions could then cancel previously allocated funding, because the Latvian section cannot be completed. The country would lose 167 million euros and miss out on the opportunity to reapply for funding.