A submarine railway tunnel between Helsinki (Finland) and Tallinn (Estonia) has received a 15 billion-euro provisional funding from the Chinese partner Touchstone Capital Partners.
The developer of this project, FinEst Bay Area Development, announced that it has signed a Memorandum of Understanding with Touchstone Capital Partners, according to which one-third of the funding will be provided as private equity, which will give Touchstone a minority stake in the future tunnel, and the remaining two-thirds of funding will be in the form of debt payments.
The authorities of Helsinki and Tallinn have been analyzing for many years the possibility of building a submarine tunnel between the two northern capitals, located at both ends of the Gulf. Tens of thousands of Estonians work in the Helsinki region and many of them commute weekly at sea, and many Finnish tourists visit Tallinn.
The proposed tunnel, with a length of 103 kilometers, would shorten the journey between Helsinki and Tallinn in about 30 minutes, compared to at least 90 minutes now with the fastest ferry boat. In addition, the rail tunnel would connect the airports between the two capitals and would also connect with Rail Baltica, a rail link that would connect Warsaw with Tallinn starting in 2026.
FinEst Bay Area, which previously estimated total tunnel costs to 15-20 billion euros, said the financial details will be established with Touchstone over the next six months. The company has already raised EUR 100 million from Dubai-based ARJ Holding Construction Company and is currently looking for European investors.
A feasibility study commissioned by the Finnish and Estonian governments published in 2017 claimed that this tunnel could be opened in 2040, but Peter Vesterbacka reiterated that the tunnel might be inaugurated by the end of 2024.
Finland and Estonia would like the submarine tunnel project to be included in the list of routes considered of vital importance to European and global transport but have so far not been supported by the European Union.