Instead of the 30,000 permits Russia granted last year, Latvia will receive 10,000 in 1999. Each year, both countries exchange an equal amount of permits to ensure smooth transportation of goods.
"That's too little," said Valdis Trezins, director general of the Latvian association of trucking companies. "We need 50,000 to 60,000 a year when the flow of transit goods is normal."
Although this news is not "official and final," as Talis Straume of the Latvian Transport Ministry put it, local truckers have little hope that the situation will improve. The joint Russian-Latvian committee that handles the permit issue is not scheduled to meet anytime soon to discuss the issue.
Straume said Latvia had asked the Russian Transport Ministry to meet a number of times, but the latter refused because it says it is "busy" with other things.
But if Russia does not change its mind soon, Trezins predicted Latvian companies will start feeling the shortage of permits by March, when the flow of transit cargo usually increases.
This situation will be a heavy blow for the Latvian trucking business since more than 70 percent of 1,700 companies specialize in carrying cargo to Russia.
Only 512 companies will not experience any problems because they have a CEMT permit that allows them to cross borders of most European countries without paying any fees. This permit is also valid for Russia.
In addition, only companies whose trucks meet all the European ecological requirements have CEMT permits. Smaller companies with old trucks have to rely on permits issued by Russia, and these are the companies that will be affected most, Trezins predicted.
"Some companies will have to cut [back on] their cars. Some will survive, but a part won't."
Trezins explained Russia's move as an attempt to protect its trucking market since foreign truckers handle more Russian cargo than local companies.
"I understand the Russian side, but they shouldn't have changed the situation that quickly. If they were decreasing the amount of permits by 30 percent each year, then local companies would have time to reorient their business," Trezins said. "Such a decrease is simply a catastrophe for any country's haulers."
Last year, Russian companies used only 4,500 Latvian permits, while 30,000 permits were not enough for Latvian truckers to transport all the transit cargo from Latvian ports.
Those companies that needed to cross the border but did not have a permit could get one for $250, but Trezins said this option will not be available this year.
Russia also issued less permits for Estonia (5,000) and Lithuania (25,000).