China takes Belt and Road act through Finnish tunnel

helsinki — A train tunnel linking Helsinki with Estonia’s capital Tallinn has got a provisional €15 billion ($17 billion) in financing from China’s Touchstone Capital Partners, the latest infrastructure investment in Beijing’s Belt and Road plan.

FinEst Bay Area Development said on Friday it had signed a memorandum of understanding providing a third of the funding in private equity, which will give Touchstone a minority stake in the planned 100km (60-mile) tunnel and two-thirds in debt.

Beijing’s Belt and Road initiative seeks to link China by sea and land with southeast and central Asia, the Middle East, Europe and Africa, through a network along the lines of the old Silk Road as well as an Arctic route.

Finland and Estonia have for years considered linking their capitals, which are divided by the Gulf of Finland and the subsea tunnel would cut the travel time to around 20 minutes from the two-hour ferry ride used by tens of thousands of Estonians who commute weekly to the Helsinki area.

“The long-term vision for Finland includes that we can get through the tunnel to Tallinn,” Finland’s Prime Minister Juha Sipila said this week during a visit to Estonia, which is a popular tourist destination for Finns.

FinEst Bay Area, which had earlier estimated the total cost of the tunnel at €15-€20 billion, said financial details will be thrashed out with Touchstone over the next six months.

The firm raised the first external funding of €100 million Dubaibased construction company ARJ Holding in December and is seeking European investors.

“Now, the financing is sorted and we can move ahead,” project leader Peter Vesterbacka, a former executive at the Angry Birds game maker Rovio, told Reuters.

A feasibility study commissioned by the governments of Finland and Estonia and published in 2017 said the planned tunnel could open in 2040 but Vesterbacka reiterated that it would be built by the end of 2024. —