THE TRACECA TRAIN IS STILL HERE: BOARDING CONTINUES

In early December, Baku hosted a conference on the Europe-Caucasus-Asia transport corridor (Transport Corridor Europe Caucasus Asia, TRACECA), dedicated to the 10th anniversary of the signing of the agreement on the corridor. It is no accident that such a large-scale event was held in the Azerbaijani capital. It was in Baku that the multilateral lagreement to develop the Europe-Caucasus-Asia transport corridor was signed in 1998. Thanks to Azerbaijan, this transport artery has become a reliable transport route for many consignors and consignees.

The transport ministers of member states of the TRACECA development programme who attended the conference in Baku signed two documents - a joint declaration of the international conference and a decision on the development of the transport corridor. The documents reflect the strategy for TRACECA development and the prospects for the TRACECA transport corridor to join the trans-European transport network covering all destinations on the continent.

According to the statistics, various types of transport carry an average of 45-46 million tonnes of cargo to various destinations annually. In addition, the European Commission initiates projects (mainly technical, not investment projects) worth 13-15 million euros every year. Specifically, 10-12 million tonnes of oil and oil products are carried from Central Asia to Europe by the corridor. As we know, there is no limit to perfection. Much remains to be done to develop TRACECA.

A billion in 10 years

Let's start by saying that a great deal of work has been done over the past year - a development strategy for the transport corridor, until 2015, and a plan for its implementation have been adopted; more than 70 projects have been financed and conditions for viable investment are in place.

"In all, investments by international financial institutions in the development of the transport infrastructure in TRACECA countries have exceeded one billion euros. TRACECA is in a new stage of development and this is supported by the entry of new members into the European Union," said Kazakh Minister of Transport and Communications Serik Akhmetov.

He added that if we followed economic developments in the world today, we would see clearly that the Europe-Caucasus-Asia corridor was growing in importance day by day.

"If we manage to increase cargo transportation and create new routes, the TRACECA project will become the most important bridge between the West and the East; against the background of the current world financial crisis, it is very important for each member country to increase the flow of cargo through TRACECA," said Akhmetov.

In turn, the Deputy Prime Minister of Azerbaijan, Abid Sarifov, said that over the last 15 years the European Commission has financed 15 investment and 61 technical projects, worth 157 million euros, within the framework of the TRACECA programme.

"As a result of the work carried out to develop the corridor, the volume of cargo transportation increased from 3 million tonnes in 1993-1997 to 9 million tonnes in 1998 and to 53 million tonnes in 2007. Altogether, since 1998, 150 million tonnes of cargo have been carried along this corridor, and the potential exists to increase this figure," Sarifov said.

Thus, in 10 years the volume of cargo transportation through TRACECA has increased more than six fold and in individual sectors by 10 times. The main cargo carried along the corridor is oil and oil products (70 per cent), as well as ore, metals, building materials, chemical products, consumer goods etc.

The secretary-general of TRACECA, Rustan Dzhenalinov, said that from 2009 to 2015, 626 million dollars will be spent on the development of the transport corridor, which will "make it possible to increase the volume of oil products and other important cargo transported".

Clearly, not only investment is necessary to increase the volume of cargo transported along this corridor. The entry of new countries into TRACECA may have a big role to play here. Over the last 10 years, it has been impossible to involve Turkmenistan in the multilateral agreement on TRACECA; this was mentioned at the Baku conference and Sarifov again urged Ashgabat to join the agreement.

Nevertheless, there has been progress on this issue. The Azerbaijani national secretary for TRACECA, Akif Mustafayev, told R+ that the member states of the main multilateral agreement to develop the Europe-Caucasus-Asia corridor may be joined by Afghanistan and Iran. These two countries have already concluded intergovernmental agreements on participation in TRACECA. It only remains to ratify membership in their parliaments. Moreover, another five countries are also ready to join. The interest of Russian businessmen in the development of the corridor is also welcome.

However, the problems do not end here. Container traffic through TRACECA comprises only 10 per cent, whereas container traffic in EU countries comprises 50-60 per cent of overall cargo turnover. Moreover, the world is seeing quite an intensive growth in container traffic - about 10-15 per cent a year. But this growth is secured mainly by marine transport, i.e. intercontinental traffic between America, the Asia-Pacific region and Europe. At the same time, container traffic is not sufficiently balanced - containers mainly carry imported cargo and are mostly empty when they return. It is, therefore, quite important to ensure that containers are full both ways.

According to Dzhenalinov, experts of member countries are working on new schemes to involve export container traffic and minimize the number of empty containers.

"Again, it is necessary to work hard here and to improve the tariff policy. The TRACECA secretariat has carried out the relevant analysis, and member countries have been offered competitive tariff rates," said Dzhenalinov.

As we can see, another important aspect in the development of the corridor is the use of single tariffs for international cargo transportation. Unfortunately, over the recent period, member countries have been unable to come to a common agreement on this issue, although single tariffs are the best way of increasing cargo traffic.

Moreover, in order to coordinate the organization of work at border checkpoints in TRACECA member states, it is necessary to introduce a regional system of information exchange based on a "single-window" principle. Another important factor is information/navigation support to the transport complex.

All these issues should be tackled in a way that ensures competitiveness and make the corridor more attractive to potential users of the transport infrastructure, following the principle of "a green transport corridor"; this is possible only with the cooperation of member states.

Plus Baku-Tbilisi-Kars

Meanwhile, the Baku-Tbilisi-Kars (BTK) railway line is under construction right now, and is considered as an extension of the Europe-Caucasus-Asia corridor because, in the long-term, the Kars-Baku line will connect to European and Asian railway lines, including those which have access to ports on the Mediterranean Sea and the Black Sea. It is natural that Azerbaijan, Georgia and Turkey are trying to interest trans-Caspian countries in new opportunities so that they make maximum use of the route through Baku, as an alternative to the Russian "window to Europe".

According to Turkish Minister of Transport and Communications Binali Yildirim, the construction of BTK will end in 2011 and, currently, there are no problems of implementation. "Turkey is currently building a railway tunnel under the Sea of Marmara and its completion will coincide with the commissioning of BTK, which will make it possible to connect Asian railways to Europe," the Turkish minister said at the conference in Baku.

Incidentally, active discussions are now under way on the resumption of regular container traffic by the Dostyk-Almata-Aktau-Baku-Poti route (Dostyk is a station on the Kazakh-Chinese border). Cargo transportation was organized along this route in 1996, within the framework of the TRACECA programme and upon the initiative of the EU, but it was later suspended. Azerbaijan hopes, today, that cargo will be transported through Baku not just to Kars, but also to Poti.

Incidentally, a number of containers were transported from the Kazakh-Chinese border to Poti in 2005 and the three countries - Azerbaijan, Kazakhstan and Georgia - unified their transport tariffs. The Kazakhs believe that this type of service may be quite successful if there is enough container cargo, first of all from China. Now the Georgians are suggesting regular container traffic.

Experts maintain that the operation of the Dostyk-Almata-Aktau-Baku-Poti route "will increase the competitiveness of the TRACECA corridor and help implement regular railway-ferry transportation". Indeed, the volume of cargo transported through Azerbaijani territory within the framework of TRACECA is increasing, but not significantly, which is why it is necessary to transport at least 20,000-50,000 containers from China by the Kazakhstan-Azerbaijan-Georgia route. We should note that tariffs need to be set quite low, especially as the transportation of container cargo through Kazakhstan, Azerbaijan and Georgia to Europe and back again is a relatively cheap route.

According to Dzhenalinov, in the long-term cargo from the Asia-Pacific region will be carried along the China-Western Europe route within the framework of TRACECA.

"Taking all this into account along with the fact that the annual growth in trade turnover between member states of the agreement exceeds 20 per cent (between TRACECA countries and the EU - more than 15 per cent), we can confidently say that the volume of cargo transported by this international transport corridor will continue to grow," Dzhenalinov said.

Moreover, in order to secure a growth in container traffic, the possibility of connecting the Viking container train running from Klaipeda to Ilyichevsk to the TRACECA corridor is being studied. It will serve as a model of communication between the network of marine container lines in the Baltic region and the similar system in the Mediterranean, Black and Caspian Seas and will make it possible to avoid lengthy and expensive cargo transportation around Europe.