Resource information
The Baltic States; Estonia, Latvia and
Lithuania and Poland are situated along strategic trade
corridors within Europe, constituting the EUs eastern border
with Russia and other CIS countries. EU membership has
triggered rapid economic growth for the Baltic States and
Poland due to the removal of trade barriers and reduced
transaction costs. A heavy influx of EU grants has targeted
development and improvement of transport infrastructure, and
this support will continue until 2015. The EU grants are
largely used for development of international corridors,
which play a key role in strengthening the competitiveness
of these new member states. Since their accession to the EU
in 2004, these countries enjoyed remarkable growth. While
the countries underwent varying degrees of contractions in
2009, signs of recovery are showing albeit with considerable
uncertainty in the future. Growth in Estonia, Latvia and
Lithuania in recent years has been unsustainable and was
driven by a disproportionate increase in the non-tradable
sector (construction, financial intermediation, real
estate). This has had negative implications for
competitiveness. The global economic crisis in 2009 has
ended Poland?s fast economic expansion over the recent
years, but in contrast to its neighbors Poland has avoided a
decline in economic activity. Over the medium term, growth
in Poland is expected to accelerate steadily in line with an
improving external environment. The Baltic States and Poland
are relatively competitive in trade logistics and have
initiated reforms to facilitate trade, compared to their
eastern neighbors, particularly Russia. Despite the plunge
in 2008, freight transport and logistics development in the
region has potential to continue to grow in the medium-term
as some signs of recovery have begun to appear. The current
economic situation has triggered a significant overcapacity
of transport and warehousing which is characterized by very
low prices for these services. While Poland remains
relatively stable, Estonia, Latvia, and Lithuania are
exhibiting higher vulnerability to external shocks. The most
critical bottlenecks of transport logistics in the Baltic
States and Poland are found in the deteriorating condition
of their transport infrastructure, particularly that of road
networks, lessdeveloped intermodal connections, and
inefficiency of custom processing at border crossing points.
Deteriorating road condition in these countries is largely
due to inadequate maintenance and a comprehensive asset
management system, albeit improving. Intermodal connections
that are often inefficient are partly attributed to
institutional arrangement that lacks inter-agency
collaboration at the level of policy development and public
investment. Custom procedures are particularly cumbersome
and inefficient at the borders to non-EU member states.
Nevertheless, the Baltic States and Poland have relative
strengths in efficiency of domestic transport/logistics,
cost-efficiency of trucking industry, and price-competitive
port operation. The report various recommendations for
strategic policy priorities for the Baltic States and Poland
to leverage their own strengths to respond to various
opportunities and challenges.
