Negotiations on the Saimaa Canal lease agreement almost complete

Ministry of Transport and Communications
Publication date 6.5.2008 11.44
Press release

Negotiations on a new Saimaa Canal lease agreement between Finland and Russia will, if possible, be concluded by the end of the year. The Cabinet Committee on Economic Policy outlined Finland's aims regarding the amount of the lease and its economic impacts on 6 May.

There is a mutual understanding between Finland and Russia on the amount of the lease. It would be based on a fixed basic amount and an amount variable according to traffic volumes on the Canal. Negotiations on the specifics of the lease will continue.

The new lease is expected to be considerably higher than at present. The current annual lease paid by the state of Finland is around 290 000 euros. Since 1963 the lease has only been reviewed once when rouble was made a convertible currency.

To maintain the competitiveness of the Canal the increase in the lease will not be collected in its entirety from Canal users, although the new agreement will probably lead to higher licence fees. The increased lease would come into effect in 2010 at the earliest.

The current agreement will expire in 2013. Official negotiations on the new lease agreement were started in September 2005. The new lease period would be 50 years.

Further information:
Mr Harri Pursiainen, Permanent Secretary, Finland's Authorised Delegate for the Saimaa Canal, tel. +358 9 160 28389 or +358 500 787742