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Siim Kallas

Vice-President and Commissioner for Transport

Using transport to link the EU and its Eastern Neighbours

At the Public Library of Tbilisi, Georgia last Friday

Tbilisi, Georgia, 18 November 2011

Ladies and gentlemen

It is a pleasure to be with you here today to talk about transport cooperation between the European Union and our neighbours and about how we can turn the vision of closer relations between us into a reality.

Transport represents the lifeblood of any country's economy since it constitutes the heart of the supply chain. Areas without good transport connections do not grow or prosper.

Georgia, of course, is no exception: its Black Sea ports, well-developed railway system and the East-West highway clearly demonstrate the important contribution that transport makes to the national economy.

Strategically positioned at the crossroads of Europe and Central Asia, Georgia is a vital bridge that links up several important economic regions. It plays a key role as a hub and transit point for the entire Caucasus and beyond. For many centuries, it has thrived as a country connecting peoples and civilisations.

That function of international connection and cooperation also applies to transport. For me, this is already a large part of what transport is all about – along with the socio-economic benefits of growth and employment that it brings.

On a practical level, it means working towards achieving compatibility between countries in their legal and regulatory environments, in safety and security, and in technical standards.

Transport is vital to opening up markets, developing trade as well as connecting businesses and people across the world. To maximise the benefits for all, we need sustainable and efficient transport networks to make it all work.

That applies to Georgia as much as to the 27 Member States of the European Union, as we strive to link up those networks beyond the EU's borders.

In Europe, we are working to get rid of the barriers, bureaucracy and bottlenecks that are holding us back from reaching that goal, along with the numerous 'missing links' across our transport network. All of these hamper growth and hinder the development of efficient networks.

Let me explain briefly how I see the future of transport in Europe.

Earlier this year, the European Commission published its views on how EU transport might look for the next few decades in a policy document called the Roadmap to a Single European Transport Area. Its broad strategy is to respond to the longer-term challenges of reducing our dependence on oil, battling congestion and mitigating climate change.

These are serious challenges, and not just for the European Union.

Congestion is one of our worst problems, especially on the roads and in the skies. It costs Europe about 1% of its GDP every year and causes heavy amounts of pollution, which doesn't help us reach our targets for reducing CO2 emissions.

We also need to break our almost complete dependence on oil, particularly in road transport. Oil is likely to become a rarer commodity in the years to come, demand remains strong and markets highly volatile – with imports coming increasingly from unstable parts of the world.

This is why we are looking into innovative, and cleaner, alternatives to fossil fuels and investing in research to develop new sources of energy

Briefly, our main goal is to create a single transport area where barriers between countries and between different modes of transport like air, rail and road are removed. By doing this, we will connect up and serve Europe's 500 million citizens, using transport to create jobs and economic growth.

We aim to relieve congestion, eliminate bottlenecks and better 'knit together' the different modes of transport – road, rail, air and sea - into a smoothly functioning network which links the Western and Eastern half of the European Union. And we want to extend that network to our neighbours too.

This is where the Trans-European Transport Network comes in. This longstanding and ambitious project has achieved some remarkable successes and is a tremendous example of the value the EU brings to its citizens.

But this is about much more than improving infrastructure, building connections and joining up the 'missing links'. Those tasks in themselves are very important but there are other aspects to transport cooperation between countries that have to be considered first.

Administrative procedures and the legal environment, for example - and above all, safety.

We firmly believe that you can never do enough to maintain proper safety and security levels; they are a pre-requisite for a competitive and sustainable industry. Safety and security are understandably at the forefront of everyone's mind when they travel. So in the European Union, we pay a lot of attention to cooperating with third countries in both areas.

Take bilateral aviation agreements, where our experiences with major international partners like the United States and Canada have been very positive. We also made progress with Russia towards enhancing cooperation in civil aviation at our summit in St Petersburg last month. Earlier this year, we reached a comprehensive air transport agreement with South America's largest air transport market: Brazil.

So I was very happy to see Georgia sign a similar agreement with the EU last year. This, along with the institutional transport reforms it has recently made in other areas, has made Georgia a frontrunner within the Eastern Partnership group of countries.

Most importantly, it puts the country firmly on the world map for further transport cooperation: so vital, in so many ways.

These kinds of transport cooperation agreements are, of course, not only about increased trade opportunities and market access. They provide the basis for a stable and transparent legal environment, a hugely important factor for doing business since it ensures fair competition.

They also mean more commercial certainty and predictability, therefore more safety.

If we are all cooperating already in areas like safety, administration and legal procedures, we are better prepared to cope with the unexpected. I am constantly surprised at how transport can suddenly take on an 'increased relevance', sometimes in an entirely unpredictable way.

Take the Icelandic volcanic eruption last year, whose ramifications went further than anyone could have foreseen. Who can forget those five days when European airspace was forced to close? with 100,000 flights cancelled and two million passengers stranded. Around 2.5 billion euros were lost by the European air transport system just in the first week.

Piracy on the high seas is another example. This is a global problem: these acts of unpredictable armed robbery affect all shipping, whatever the flag or nationality of the owner or crew.

Ladies and gentlemen

Turning now to Georgia specifically, I know that much has already been achieved to reform, modernise and expand your transport sector - and I welcome the progress made, particularly the creation of independent transport agencies.

In road transport, for example, the new laws coming into force this year on seatbelts and speeding should help to reduce the high rate of road fatalities. Georgia's accession to the AETR agreement on international road transport, leading to the introduction of the digital tachograph, brings the country closer to the EU's transport market. This is all good news.

There are, however, other areas where more work needs to be done. Aviation is a prime example.

Georgia must now pay close attention to implementing the common aviation area agreement which I mentioned earlier, particularly regarding safety where it is essential to have reliable inspections. Georgia should also implement the safety roadmap established by the European Aviation Safety Agency.

In the maritime sector, we welcome Georgia's efforts to correct the various deficiencies in the education, training and certification of seafarers that led the EU to withdraw its recognition of national seafarer certificates last year.

It would, perhaps, be wise not to rush into holding an audit by the EU's maritime safety agency before all the problems have been properly addressed.

If there is no regard for safety, security or the environment, or if border procedures are inefficient because of heavy bureaucracy, for example, then there is little point in building a new highway or high-speed rail link.

So we need to find a new way of addressing these and similar problems as we extend our transport network to our neighbours to the east. The Eastern Partnership Transport Panel, established last month, will play a key coordinating role in doing this, as a forum for enhanced cooperation. After all, cooperation is the key to linking us better together.

The Panel brings together the European Commission, EU Member States, Eastern Partnership countries and several heavyweight financial institutions like the European Investment Bank, the European Bank for Reconstruction and Development and the World Bank.

The European Union already co-finances transport interconnection projects by blending EU grants with loans from these institutions via a funding facility.

Looking further ahead, we will be using the 'Connecting Europe Facility' for the next seven years starting from 2014, with a substantial amount devoted to transport. But despite the impressive leverage rates we have seen with public spending on transport, this will still not provide enough money for all projects.

So we will need to pool resources and combine funding, working together with these financial institutions I have mentioned. The public purse does have a limit.

Ladies and gentlemen, to conclude:

The European Union is committed to support, but not replace, the ideas and aspirations of neighbours and other countries that want to develop closer links – to connect people and businesses, to guarantee the vital liberty of freedom of movement.

A spirit of international cooperation in transport means that we can all gain, by improving trade and business flows – and by increasing mobility for everyone.

Thank you for your attention.

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