The Belgian-Lithuanian business forum in presence of His Majesty Albert II, King of the Belgians and His Excellency Valdas Adamkus, President of the Republic of Lithuania FEZ Kaunas launches : The Euro-baltic network city Freddy OPSOMER MRE : Vilnius, tuesday, march, 21st, 2006

1 1.Modal Split 2.Trends in the European Logistics Market 3.Kaunas at the cross-roads of two TEN-corridors 4.Kaunas FEZ CONTENT

2 1. Modal Split

3 Modal Split in the EU Modal split of freight transport in EU-25 (in Mtoe) Source: European Commission, 2003 Exponential growth of road transport Share of rail and inland navigation is decreasing Result: negative external effects of transports market are no longer sustainable and intermodal solutions need to be developped

4 Modal Split in Lithuania Modal split of freight transport in Lithuania (in Gtkm) Source: European Commission, 2003 As in the rest of the EU, the Lithuanian freight transport system also shows a growing modal imbalance. Like in the other new Member States use of rail transport is quickly dropping.

5 2. Trends in the European Logistics Market

6 Logistics in the EU is gradually changing from a monolythic model (Blue Banana) into a polycentric model. In addition to the Blue Banana and the Meditterranean Arc investments are concentrated in Poland, Hungary, Chech Republic and Slovakia. Investments in the Baltic area in logistics are still limited. Hinterland intermodal infrastructure need further investments. Actual European logistics main structure

7 Development of logistic pockets with intelligent intermodal infrastructures as connections Increased competition between European regions for logistics investments. Southern Germany as geographic centre of the EU will become an important logistics node. Baltic and Black Sea areas will also become important logistics hubs based on North-South flows. Mainports will remain important for intercontinental trade from- to Baltic Sea. Expected logistics main structure in the medium term (2020)

8 Emergence of a Eurasian land bridge which will primarily be based on rail transport. Baltic countries will become important nodes in N-S and E-W freight flows. Expected logistics main structure in the long term (2030)

9 3. Kaunas at the cross-roads of two TEN corridors

10 Kaunas will become a logistics hotspot at the crossroad of TEN corridors I and IX. Kaunas wiil become junction of important N- S and E-W freight flows.

11 4. Kaunas FEZ

12 fast growing economy expected next 10 years / Lithuania : the Baltic tiger large consumer market : 200 mi consumers within 1000 km range stable legal framework : EU and Lithuanian legislation for Free Zones custom free zone : transit of goods and services corporate tax advantages : - no tax (year 1-6) - 50 % tax reduction (year 7-16) Kaunas FEZ : advantages (1) 500km= consumers 1000km= consumers

13 Kaunas FEZ : advantages (2) Kaunas : Euope gate on Euro-Asian landbridge - north south : Rail Baltica and Via Baltica - east west : corridor IX Rail and road corridors

14 Kaunas FEZ : target sectors woodprocessing / furniture / textile value added logistics (rail and air cargo) : Finnish group YIT as first client mechatronics : Elinta gives start of technology cluster

15 Kaunas FEZ : issues to be solved urgently land : bordering and expropriation issues very urgent : otherwise loss of important FDI for Lithuania urgent need for multimodal integrated vision : Kaunas airport - Palemonas rail - rail baltica - FEZ

16 Thank you