Estonia, EU – Baltic States, Latvia, Lithuania, Railways, Transport

Rubesa resigned as CEO of RB Rail on Thursday, September 27, 2018, morning. At the press conference, she said that she had already planned to resign this summer, but decided to stay for longer at the request of the Latvian prime minister. Rubesa said she had chosen to resign now and draw attention to the project's shortcomings.

"My profound concern is that the Rail Baltic project is at serious risk of not being properly implemented," Rubesa said. She emphasized that the current project management is weak and that conflicts of interest have been encapsulated in the very roots of the project.

In order to improve the situation, she made suggestions to the European Commission, selected MEPs and other involved parties, commenting on the problems of the project extensively. For example, she highlighted that the European Union must have a tangible role in cross-border projects.

Financial support for the Rail Baltic project from the Connecting Europe Facility (CEF) grants is at an extremely high level of 85%, Rubesa said. She added that at the same time, the expectations and recommendations of the EU are barely considered by national beneficiaries. The former CEO of RB Rail said that in the future, it should be mandatory for the European Commission to also be involved in the project. One option could be the direct involvement of a Commission's representative in the joint venture itself, at least as an observer.

Rubesa brought an example from Estonia, where, according to her, the project company Rail Baltic Estonia managed by the Ministry of Economic Affairs and Communications supported the project implementation model driven by the joint venture.

"It is curious that with the Center Party gaining political leadership of the government of Estonia, the very same Transport Ministry's [Ministry of Economic Affairs and Communications] civil servants and the new leadership of Rail Baltic Estonia have been dead set against an effective joint venture," she said. According to Rubesa, one civil servant had repeatedly state that the Baltics do not need a joint venture and that if the European Commission wants it, they should also pay for it.

"The current CEO of Rail Baltic Estonia has repeatedly stated that we are just building tracks and need to start construction soon, ignoring the vision for a new economic corridor or the need to drive innovation and digitalization for sustainable impact," she said. "It remains to be seen in whose national interests such a change in position may be," Rubesa added.

Rubesa also highlighted as a significant problem the fact that the three Baltic states are seemingly taking on two roles with the project: firstly, all countries are beneficiaries, while they are simultaneously responsible for supervision through the joint venture.

Rubesa said the current structure creates an unwanted loop of supervision and inhere conflicts of interest that delay any decision-making process, as national shareholders have thought about their national interests. "To me, this is probably the saddest example of mismanagement in the history of public sector governance," Rubesa said, adding that the case is particularly blatant in Lithuania, as their representative on the supervisory board of the joint venture actually represents state-owned Lithuanian Railways.

Rubesa also noted that the project needs a multi-year sustainable financing model and has to ensure appropriate resources for RB Rail to implement its mandate. For example, RB Rail must be able to attract highly qualified experts. Rubesa said that the states are currently guided by their own national interests and the joint venture must constantly compete with the state-owned local companies.

As a fourth aspect, Rubesa highlighted that the project requires a clear political management, foremost on the prime ministers' level, as this is also a significant political joint project. She said that the prime ministers do not have a real overview of the actual state of the project.

Rubesa nevertheless said that if there is will, it will be possible to succeed with the Rail Baltic project. The former CEO of RB Rail also highlighted that this joint project is the litmus test of Baltic cooperation.