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The Future of Passenger Mobility and Goods Transport in Estonia

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The Future of Passenger Mobility and Goods Transport in Estonia CPB Corporate Partnership Board The Future of Passenger Mobility and Goods Transport in Estonia Input Study for the Estonian Case-Specific Policy Analysis Transport and Mobility Master Plan The Future of Passenger Mobility and Goods Transport in Estonia Input Study for the Estonian Case-Specific Policy Analysis Transport and Mobility Master Plan The International Transport Forum The International Transport Forum is an intergovernmental organisation with 62 member countries. It acts as a think tank for transport policy and organises the Annual Summit of transport ministers. ITF is the only global body that covers all transport modes. The ITF is politically autonomous and administratively integrated with the OECD. The ITF works for transport policies that improve peoples’ lives. Our mission is to foster a deeper understanding of the role of transport in economic growth, environmental sustainability and social inclusion and to raise the public profile of transport policy. The ITF organises global dialogue for better transport. We act as a platform for discussion and pre- negotiation of policy issues across all transport modes. We analyse trends, share knowledge and promote exchange among transport decision-makers and civil society. The ITF’s Annual Summit is the world’s largest gathering of transport ministers and the leading global platform for dialogue on transport policy. The Members of the Forum are: Albania, Armenia, Argentina, Australia, Austria, Azerbaijan, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Canada, Chile, China (People’s Republic of), Croatia, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, India, Ireland, Israel, Italy, Japan, Kazakhstan, Korea, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Mexico, Republic of Moldova, Mongolia, Montenegro, Morocco, the Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, Russian Federation, Serbia, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Tunisia, Turkey, Ukraine, the United Arab Emirates, the United Kingdom, the United States and Uzbekistan. International Transport Forum 2 rue André Pascal F-75775 Paris Cedex 16 [email protected] www.itf-oecd.org Case-Specific Policy Analysis Reports The ITF’s Case-Specific Policy Analysis series presents topical studies on specific issues carried out by the ITF in agreement with local institutions. Any findings, interpretations and conclusions expressed herein are those of the authors and do not necessarily reflect the views of the International Transport Forum or the OECD. Neither the OECD, ITF nor the authors guarantee the accuracy of any data or other information contained in this publication and accept no responsibility whatsoever for any consequence of their use. This work is published under the responsibility of the Secretary-General of the ITF. This document, as well as any data and map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Cite this work as: ITF (2020), “The Future of Passenger Mobility and Goods Transport in Estonia: Input Study for the Estonian Transport and Mobility Master Plan”, International Transport Forum Policy Papers, No. 78, OECD Publishing, Paris. Foreword Transport allows people and goods to move freely and offers broad access to services. It is a cornerstone of European integration and a major contributor to the European Union’s economy, connecting people across different regions and countries. Demand for mobility has traditionally grown as economies and societies have become more integrated, bringing innovation and investment opportunities. Yet, crises like the Covid-19 pandemic reversed this trend and threaten connectivity, thus confronting citizens, businesses and authorities with unprecedented challenges. A fully recovered and resilient transport sector will play an important role in the climate transition and the digital transformation. Developing sustainable and smart mobility solutions will be a key part of the European Green Deal. Estonia was one of the first countries to make use of the EU’s Structural Reform Support Programme (SRSP). The SRSP provides tailor-made, demand-driven technical support to EU countries for the design and implementation of growth-enhancing reforms. Estonia requested SRSP support in 2018 to pursue, among other things, an ambitious range of preparations for a new National Transport and Mobility Master Plan. This report, prepared by the International Transport Forum at the OECD in cooperation with the European Commission’s Directorate General for Structural Reform Support (DG REFORM), is a key input to the plan. The most tangible parts of a transport plan relate to decisions to construct infrastructure. What road or rail project should be built to improve the mobility of citizens? What will make freight flows more seamless? Yet infrastructure investments represent only the tail end of transport policy-making, and an ambitious transport investment programme alone does not, in itself, signal reform. Investment programmes are based on a whole set of choices. These choices depend on the way policy decisions are made, how the transport sector is organised, and what incentives infrastructure managers and infrastructure users face. This report focuses on each of these three aspects of strategic planning and policy making, and across all transport modes. It proposes substantive reforms in each area. It rests on rigorous and in-depth analysis, both qualitative and quantitative. The parameters were determined jointly with the Estonian Ministry of Economic Affairs and Communications, the country’s line ministry for transport. The report does not attempt a comprehensive description of Estonia’s current transport and mobility system, notably those areas that work well. Rather, it focusses on existing issues and on ways to address them. To this end, it provides a simulation tool as a strategic model to help inform Estonia’s transport policy decisions while a fully specified national transport model is being built. The transport carbon footprint in Estonia can be substantially reduced, depending on how ambitious the country wants to be in the decades to come. The simulations for this study show that achieving this (and other major policy goals) will mean building fewer roads and motivating citizens to walk, cycle and use public transport more. The vision for the future of freight transport is less clear. The greatest challenge will be to reposition Estonia as a bridge between the Baltic region and Southern Europe. Success hinges decisively on whether Estonia can align its interests with those of its neighbours; simply building more infrastructure will not suffice. At the same time, pursuing this shift should not lead Estonia to compromise transport decarbonisation or jeopardise the recovery of infrastructure costs from fee-paying transit traffic. The Rail Baltica project, once completed, is planned to boost both regional connectivity and freight decarbonisation. As the work for this report was being finalised, the Covid-19 pandemic swept the globe. This unprecedented health crisis has fundamentally disrupted the lives of citizens and the economy. The massive, but hopefully temporary, challenges created by the Coronavirus crisis became apparent too late to fully reflect them in the analysis. However, as robust data on the impact of the pandemic become available, the simulation tool provided together with this report will enable Estonia’s government to update the scenarios for the country’s transport future presented herein. Young Tae Kim Henrik Hololei Mario Nava Secretary-General Director-General for Director-General for International Transport Forum Transport and Mobility Structural Reform Support OECD European Commission European Commission ACKNOWLEDGEMENTS Acknowledgements This project was managed and co-drafted by Dejan Makovšek and Eric Jeanniere, with contributions by Rex Deighton-Smith, Jagoda Egeland, Malithi Fernando, Francisco Furtado, Lucie Kirstein, Juliette Lassman, Peter Mackie, Luis Martinez, Olaf Merk, Tatiana Samsonova, Katja Schechtner, Klaas Westerkamp, Elisabeth Windisch and Tom Worsley. Jari Kauppila and Stephen Perkins provided quality assurance. The ITF communications team, Michael Kloth, Edwina Collins and Hilary Gaboriau, prepared the report for publication. We also wish to acknowledge the support of the Estonian government, in particular Johann Peetre, and many officials of the European Commission, who facilitated effective co-operation, participated in the interviews or provided feedback on the draft outputs of this project. THE FUTURE OF PASSENGER MOBILITY AND GOODS TRANSPORT IN ESTONIA © OECD/ITF 2020 5 TABLE OF CONTENTS Table of contents Glossary ........................................................................................................................................ 10 List of abbreviations ..................................................................................................................... 12 Executive summary ....................................................................................................................... 14 Chapter 1. Report overview and main messages .......................................................................... 18 1.1. Which policy reforms should have priority? ................................................................. 18 1.2. How
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