State-owned Estonian Railways has decided to slash 200 jobs following a drop in railroad traffic volume from Russia amid controversy surrounding a Soviet-era monument, the company said Tuesday announcing half-yearly results, according to dpa. "The 6-month results arise from two quite distinct periods: the first record-breaking four months, the second - again record-breaking but for the wrong reasons," said Estonian Railways board member Steven Archer. Increasing labour costs, increased cost of rail maintenance, and decreased traffic flow prompted the cuts. The cost of labour has increased by 20 per cent, Archer said. During the last six months, Estonian Railways earnings decreased by 2 per cent compared to the same period in 2006. The breaking point was the Estonian government's decision to relocate Tallin's Bronze Soldier statue in April, bringing the relationship between Estonia and Russia to a low. "About 85 per cent of the cargo volume of Estonian Railways comes from Russia and goes forward to transit," the company's public relations manager Urmas Glase told Deutsche Presse-Agentur dpa, on Tuesday. Estonia is the transit route for 25 million tons per year of Russian fuel, or around a quarter of the country's total oil products exports. The average traffic on the Estonian Railways decreased from 30 trains a day in June 2006 to 20.5 trains a day in June 2007, according to the company. "Officially Russian authorities have only one explanation: railway construction work keeps the capacity down," Glase said. Unofficially however Russian companies have been trying to avoid using Estonian ports and railway network following the statue row. Russia's state railways have ordered exporters to halve shipments of refined oil products, metals and coal via Estonia amid renewed political tensions with Tallinn in July. Many Russian politicians have called on state officials to stop re-exports of goods through Estonian ports, while Tallinn has said Moscow should be kicked out of the G8 Group of industrialized nations for its controversial energy policies. Heeding the call, Russian supermarkets pulled Estonian products from their shelves, Russian media reported. Last week, the Russian transit group Severstaltrans announced it is planning to sell Estonia's largest transit terminal E.O.S., Postimees daily reported. Estonian Railways doesn't expect the cargo volume to reach the level before the April events. "The company will be able to reach the level of about 80 per cent from past volumes, but nobody has any guarantees, Glase said.
