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Latvian government desperately tries to cut Rail Baltica costs

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Viktors Demidovs
Latvian government desperately tries to cut Rail Baltica costs
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The Latvian government is struggling to manage the rising costs of the Rail Baltica project, which is now estimated to cost 7.5 billion euros. Officials are seeking to balance budget deficits while defending the project's importance to the European Council.

Why it matters

Rail Baltica is a critical infrastructure project for the Baltic states, and its ballooning costs pose significant fiscal challenges for the region.

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Prime Minister Andris Kulbergs (“United List”) pointed out that, overall, this would save billions of euros, but government representatives did not specify how much the first phase of the project would cost. “We need to understand, based on the funding model over a specific time frame, what the impact on the budget will be and how much funding is required from the state. There are several models. I want to hear what they are, because we need to balance all our expenditure. We cannot put together a budget that takes into account both the deficit we’ve already accumulated and our commitments. Then there is the question of priorities. The most important thing from this meeting is that on 15 October I must travel to Brussels for the European Council to defend our positions on next year’s European budget. ‘Rail Baltica’ is a key issue.

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