Karelia strikes €4,6 billion East-West infrastructure deal

Governor Aleksandr Khudilainen signs a historic road agreement with Dmitry Belkin, head of the Northwest Corridor Development.

The new highway between Petrozavodsk and the Finnish border will significantly increase transport connections between Europe and Central Russia, Karelian Governor Aleksandr Khudilainen says.


Private interests will invest more than 200 billion RUB (€4,61 billion) in the project, which includes the construction of a 426 km long new highway connection between the Republic of Karelia and Finland.

“The development of this transport corridor will boost the investment attractiveness of the adjacent territories and significantly improve the transport connection between Europe and Central Russia”, the regional government informs in a press statement.

A project agreement was signed on Thursday at the Sankt Petersburg Economic Forum between Governor Khudilainen and Dmitry Belkin, Head of the Northwest Corridor Development, an infrastructure company.

The project will also include the construction of a new border crossing between Syuvyaoro (Russia) and  Parikkala (Finland).

According to Governor Khudilainen, the regional government will “do what it can to make the construction of the new road start already in 2013-2014”. The construction period is expected to last from six to ten years and employ up to 1500 project workers.

The investors are planning the development of a project infrastructure hub with storage facilities, customs terminals and traffic management control in the local municipality of Lakhdenpokhsky.

The new infrastructure connection is expected to result in a significant increase in both passenger traffic and trade between the Russian region and Finland. Cross-border activities between the sides are from before extensive, with more than 10 million people crossing the Russian-Finnish border in 2012.

The two neighboring countries today have a total of eight regular auto traffic border crossings, of which three are located in the Republic of Karelia.

As previously reported, Russia and Finland have also invested in cross-border rail infrastructure and have success with the high-speed Allegro railway connection between Sankt Petersburg and Helsinki.