WE ARE REDUCING DISTANCES!

1. WE ARE REDUCING DISTANCES! Freeport of Riga: a SustainableBrand in Logistics Edgars Sūna, MarketingDirector, Freeport of Riga Authority April 12, 2012

2. Latvia Latvia in Brief • 64 000 square km • Population 2,2 million • GDP 18,12 billion EUR (2010) • Transport and Communications sector builds 11% of GDP (2010) • Currency LVL (Lats),1 EUR = 0,7028 LVL • Member of the EU and NATO since 2004 and the WTO since 1998 • 3 major ice-free ports and 7 small ports • 4 special economic zones

3. Port Authority Our Vission and Mission We aim to develop the Freeport of Riga as: Our Mission: We will continue to develop the Freeport of Riga as a leading port of the Baltic States and as a source of real prosperity for Latvia. • customer`s port of choice because theyvalue our safe, efficient and competitively priced services • multifunctional port which fully exploits the benefits of Freeport status and demonstrates sustainable economic success • socially and environmentally responsible port which is adaptable and able to respond to global trends and the changing needs of customers.

4. Business Card Freeport of Riga in 2011 • By cargo turnover Latvia’s biggest port and the third biggest port in the Baltic States (34 mln.t) • Multifunctional port with cargo handling capacity 45 mln.t/year • Fast growing port – annual growth rate +11.8% • Port accounts for 5 200 direct and close to 15 000 indirect work places (railway, forwarding, agencies, trucking, etc.) • Total port revenues reached EUR 402 mln and net profit EUR 46 mln (2010) • Taxes paid into the state and Riga municipal budgets - EUR 28 mln (2010) • www.freeportofriga.lv

5. Business Card Freeport of Riga – 11% of the City Territory Main infrastructure figures Total port area6 348 ha Total berths length13.8 km Max. depth 16.0 m Max. vessels draft 14.7 m Legend Port border line ––– Railway - - - Main roads –––

6. Location Riga in the Network of Eurasian Transport Corridors East-West transport corridor Riga as a part of the corridor is linked to the Trans-Siberian Railway Haulage by the Trans-Siberian Railway saves transit time by 12-15 days in route Far East –Europe North-South transport corridor Easy access to the corridor connecting Europe with the Middle East

7. Location The Baltic Sea – a Region of Strong Port Competition Turnover at ports by country in 2011 RUS 185,4 mln t LAT 67,4 mln t LIT 45,5 mln t EST 36,5 mln t FIN 27,2 mln t Eastern Baltic Sea Region 11 ports compete for cargo to/from Russia Total cargo turnover at the ports of the Eastern coast of Baltic Sea reached 362mln t in 2011

8. Connectivity Regular Liner Services MSC Antwerp-Bremerhaven-Kaliningrad-Riga-Gavle CMA-CGM Hamburg-Gdynia-Riga Unifeeder Hamburg-Bremerhaven-Riga-Klaipeda Team Lines Hamburg-Bremerhaven-Riga-Klaipeda MannLines Multimodal Rotterdam-Gdynia-Kaliningrad-Riga Containerships Riga-Klaipeda-Teesport-Rotterdam-Sheerness-Helsinki-St.Petersburg Maersk Bremerhaven-Klaipeda-Riga- Bremerhaven Tallink (ro-pax) Riga-Stockholm

9. Connectivity Hinterland ConnectionsDedicated Container Trains Container block train “Riga Express” (Riga-Moscow) Container train “Baltika-Transit” (Riga-Almaty) Container train “Zubr” (Riga-Minsk-Illichevsk) Block Train (Riga-Hairaton)

10. Connectivity EMMA - Eurasian Multi-Modal Alliance Eurasian Multi – Modal Alliance Since 2011 a joint venture EMMA was established between Latvian forwarder SRR and French logistics group GEFCO for services to/from Riga to/from Central Asia

11. Costs Totaltransportlogisticscostcomparisonforthe ports of EBSR (EUR/20’) in routeFarEast - Moscow St.Petersburg 1752EUR/20' Tallinn 1529EUR/20' Hong Kong-Bremerhaven Moscow Riga 1523EUR/20' 1764EUR/20' Klaipeda

12. Costs Totaltransportlogisticscostcomparisonforthe ports of EBSR (EUR/20’) in routeFarEast - Almaty St.Petersburg 2511EUR/20' Tallinn Hong Kong-Bremerhaven 2405EUR/20' Riga 2347EUR/20' Klaipeda 2615EUR/20' Almaty

13. Infrastructure Port Infrastructure Warehouses 180 000 m² Open storage 1 797 000 m² Cold storage 13000t Tank farm 350000 m³ Port Infrastructure Total port area 6 348 ha Port land 1 962 ha Available land 445 ha Total berths length 13,8 km Max. depth 16 m Max. vessels draft 14.7 m

14. Infrastructure Port Companies 33 stevedoring companies 28 ship agencies 37 companies provide different facilities for cargo warehousing 16companies operate customs warehousing 7 companies provide different added value services 12 companies offer cargo forwarding services

15. Infrastructure Facilities for Container Handling Largest vessel handled EM Athens(2010) Length207 m DW 32 350 GT 25 294 Capacity 2503 TEU • Total handling capacity 480 thous. TEU • 3 terminals: Baltic Container Terminal, Ltd, Riga Universal Terminal, Ltd, Riga ContainerTerminal, Ltd • All terminals are directly linked to the main rail routes • Container ground slots 9350 • Crane productivity 25-30 cont.mov./hour • Max draft at containerberth13.5 m

16. Performance Cargo Turnover at the Freeport of Riga (mln. t) 40 35 30 25 20 15 10 5 0 Total Liquid Bulk General Cargo Dry Bulk 34.1 30.5 29.7 29.6 25.9 25.4 24.4 24.0 21.7 18.1 14.9 13.4 2000 2001 2002 2003 2004 2005 20062007 2008 2009 2010 2011 • Average annual growth rate 9.1%

17. Performance Inbound and Outbound Cargo in 2011 78% of cargo handled at the Freeport of Riga is transit traffic

18. Development Development Projects (2010 – 2020) Port Authority`s Investments 1 1 2 2 4 3 3 3 6 4 5 7 5 6 8 8 7 • Total port investment portfolio 1.1 bln EUR • Port Authority`s Investment 300 mln EUR • Private investment 757 mln EUR • Deepening of the fairway to 15 – 17m • Multifunctional dry bulk terminals on the Krievu sala • Modernization of the port’s railway network • Construction of a new railway bridge • Private Investments • Oil products terminal in Bolderaja • Liquified natural gas (LNG) terminal in Daugavgriva • Terminals on the Kundziņsala island (fertilizer, container, grain and logistics park) • Terminal for production and handling of bioethanol

19. Investment Investment Opportunities at the Freeport of Riga • Long-term lease of land on attractive terms (up to 45 years) • 445 ha of land available for development • Status of a licensed company and free zone regime allows to receive tax relieves • Freeport Authority assistance in the development of private terminal infrastructure • A favorable investment climate in Latvia

20. Investment Available Territories for Development Available territories • Approx. 445haare presently available for the development of new facilities (distribution, logistics, warehousing, etc.)

21. Investment Status of a Licensed Company andtheFree Zone Regime Tax relieves: • Direct taxes • Income tax 80 % • Real estate duty 80-100% • Indirect taxes • Value added tax 100 % • Excise tax 100 % • Customs duty 100 % • Freeport status provides for substantial tax reductions • Status of a licensed company allows to receive direct tax relieves • Licensed company fulfilling certain requirements of the Free zone regime can receive both direct and indirect tax relieves • Licenses are issued for 5 years by the Freeport of Riga Authority

22. Investment Investment Climate in Latvia • Business without borders: an EU member state • Advantages and experience in working with Russia and the CIS • A highly skilled and multilingual workforce • Easy to set up and manage business • Equal rights and benefits for both foreign and local investors • Opportunities to qualify for funding from the EU`s Structural Funds

23. Summary Port of Riga: HubforLogistics of theTextileIndustry in theBaltics • Strategically well linked to economically strong and developing areas(closest EU port to Moscow, EU border with Russia) • A corridor of competitive total transport logistics costs • Multifuncional port with powerful infrastructure for the container handling • Favourable business conditions (Free Economic Zone, long-term lease of land on attractive terms, available land for development)

25. Thank you for your attention!