Sanctions Backfire: Russian Ports Profit as Baltic Ports Empty

Latvia annually faces funding shortages for healthcare, defense, and infrastructure, while its ports and railways continue to lose cargo. The transit sector, once a pillar of the economy, is shrinking rapidly. Meanwhile, Russian ports have seen a 10% increase in cargo volume, and Russia earns approximately €486 million annually from Belarusian fertilizer transit alone.

Latvia's three major ports cost about €15 million per year to maintain, with an additional €6 million needed. The railway infrastructure can no longer sustain itself from usage fees, requiring state subsidies. According to the railway development plan for 2025–2029, without additional funding, Latvia's railway solvency and infrastructure maintenance are at risk.

In the first half of 2024, Latvian ports handled 15.4 million tons – 11% less than the previous year. Railway cargo volume fell by 18.7%, and over ten years, total cargo volume dropped by 85%, while transit through ports declined by 90%. Previously, Belarusian fertilizers were mainly handled in Klaipėda, Riga, and Ventspils, but now they flow through Russian ports.

This raises the question: was the goal of sanctions to weaken Russia, or have they inadvertently created a new profit source for the aggressor? The losses suffered by Baltic states have not disappeared – they have simply shifted to Russia's transport sector. Money that once created jobs and filled budgets now flows to Russia, prompting an uncomfortable yet crucial question about the effectiveness of sanctions.