Source: https://www.railfreight.com/business/2020/04/28/why-the-scandinavian-cooperation-on-rail-does-work/

It is often said that the European railways network is a patchwork of different systems and interests. A quite different impression stems from the Scandinavian cooperation. Especially when it comes to the ambition to develop the Nordic Silk Road, Norway, Sweden and Finland are on the same track.

The project is called Nordic Railgate cooperation. The train service that currently connects the Central Chinese city of Xi’an to Kouvola in Finland, will eventually run to the Norwegian port of Narvik, via Haparanda in Sweden. In January this year, representatives of the regions involved emphasised their willingness to make this happen once again. Why is this so important for the Nordic countries, each with their specific characteristics and interests?

Norway

Let’s start with Norway, which is represented in the Nordic Railgate cooperation by the port of Narvik. This is the most northern port of the country, and the most northern end of the railway network in Norway. When the railway connection is up and running, it wants to use it for the transport of salmon to China. This high-in-demand eatery is currently shipped by air (fresh) or ocean (frozen).

The recent opening of the fresh route through Russia is another step in this direction. “We have just got the permit to transit Russia by train, so we working hard to find customers that want to try our rail product”, says Rune Arnøy, CEO of the port of Narvik. “The fish has to be frozen all the way. In that matter, we also need reefer containers. We hope this will be up and running within a couple of months, but the corona crisis is making things a little diffecult at the moment.”

Multimodality

It is not just the transport of fish this Nordic port is betting on. In general, the railway connection is a good add to the port, Arnøy argues. “This rail connection will serve the port with new and interesting opportunities. This will make the port of Narvik a multimodal hub in Norway. As we are the only port in Norway with on dock rail connections close to the North Atlantic Ocean, we can also work closely with the USA and Canada. They may be interested in our port as it is not congested, as is the case with many other ports.”

Arnøy furthermore strongly believes in relevance of the rail-road route on the northern half of the Scandinavian countries. “This route has been there since 1903 and already serves us in many ways. By using this route, we all benefit in a more efficient and more economic way, instead of using the bigger ports down south, in the Nordic or European countries.

Sweden

Whereas Norway has the port and Finland the gateway terminal, Sweden is caught in between. But, with crucial railway lines such as the Haparanda and Iron Ore Lines, it is certainly part of the whole solution. “We are on this line together”, says Göran Wigren, executive director of Civil Administration at the City of Haparanda.

The construction of the Haparanda Line was crucial in this, Wigren explains. This 165-kilometer long railway line between Boden and Haparanda has a section from Haparanda to Torneå on the Finnish side of the Finland–Sweden border. This makes the line the only Swedish railway to the Finnish border. Moreover, the single track line is used exclusively by freight trains. The line was delivered in 2013, when rail freight traffic between the Nordic countries considerable increased.

Plenty supply

There is plenty of goods to be moved along the line to or from China. Export to China constituted 4,5 per cent of all Swedish export in 2017, which makes China Sweden’s eight largest export market. Machinery and equipment is the biggest category of goods (33 per cent), but also medical and pharmaceutical products and vehicles account for a large part of exports. “The Swedish car industry depends on China. We have common car manufacturers that exchange cars and car parts”, explains Wigren.

In terms of imports, China is Sweden’s seventh largest source. In 2017 imports from China amounted to 71,8 billion SEK. Machinery and equipment is the biggest category of goods (38 per cent). Clothing is the second largest category (11 per cent). All these are products for which rail is an attractive option.

Finland

At the moment, the biggest role is laid out for Finland, which as a neighbouring country to Russia is the gateway to the Trans-Siberian route. The city of Kouvola has taken up this role by developing a new state-of-the art rail-road terminal. “This terminal will operate on an open access principle and allow for handling trains of over one kilometre in length”, says Harri Mustionen, Sales Manager at Kouvola Innovation Oy.

“Construction work is on schedule and when the first phase is completed at the end of 2022, the Kouvola Rail and Road Terminal (Kouvola RRT) will be an efficient and competitive terminal area for intermodal transportation. It will respond to the growing requirements of national and international traffic.”

But even today the trains between Kouvola and Xi’an are already forming a part of the Nordic Silk Road, as the Chinese connection to the Scandinavian countries is called. From Kouvala, the route leads through Russia, Kazakhstan and terminates in Xi’an. This rail freight service is offered in both directions. Kouvola Innovation Oy would like to extend this route to Oulu in the north of Finland. “Here is an existing modern combined terminal ready for transloading goods between road and rail on the rail journey from Kouvola – Oulu –Tornio – Haparanda and vice versa”, Mustonen says.

Trade with China

The rail connection is good for the export of Finland’s basic commodities, which represented the bulk (44 per cent) of Finnish export to China last year. “Pulp alone accounted for 25 per cent of the export. Industrial machinery, a second important export product group, constituted nearly a third of goods exports. Exports of meat products has grown quickly, even if food was still just 2 per cent of exports”, Mustonen says.

Finland also imports from China, mostly electronics and other machinery & equipment (53% in first 9 months of 2019). “The remainder was other manufactured goods. Clothing had a10  per cent share.”

Things to be done

Although the willingness to connect all Nordic countries to China is there and the first steps are taken, there are improvements that need to be made if the connection is to reach its full potential. Most importantly, the Iron Ore and Haparanda Line must be upgraded.

The Iron Ore Line runs from Narvik to Lulea in Sweden. “It works, but it needs a double track in order to meet the needs of the industry. Currently, passenger trains have to stop when an iron ore train passes by”, says Wigren. Works to realise this double track are now underway, and the capacity that this generates should be available in 2020. According to Arnøy, a double track enables the handling of 40 trains per day, whereas it now allows for 26 per day. “It is mostly about the stretch from Narvik up till Kiruna, this is the most congested part.”

Upgrading Sweden-Finland link

The Haparanda Line, in particular the section connecting to Torneå, needs upgrading on both sides of the border. In Finland, electrification of the line is required. But there is also need for more efficient reloading facilities in the terminal, and modern equipment for changing axle width or change of train bogies”, Mustonen explains.

“Several studies have been carried out in regards of the investments, which is planned to be made with the support of the CEF programme. As this is the only railway connection between Finland and Sweden and the rest of EU, it is of special importance. It also has the potential to be an essential link for railway transport from northern Norway and Sweden towards Russia and China.”

Lot of distance, less players

With so much to do over such long distances, one can only imagine the importance of close cooperation between the countries. According to Wigren, this is a lot easier in Scandinavia than in other parts of Europe. “We only have a few neighbouring countries to deal with, and only a few places where we need to synchronise our demands. This is a special case.”

It is therefore not surprising that the latest possibilities on rail have already been implemented in this corner of the world. For example the length of trains: the new terminal in Kouvola will handle 1000-metre trains, a novelty for Europe and a promising feature for the Nordic Silk Road. Once everyone is onboard, there is plenty of capacity on this New Silk Road addition.