SMOOTH AS SILK

It is difficult to overestimate the significance of the Transport Corridor Europe-Caucasus-Asia (TRACECA) for the development of transit potential of South Caucasian and Central Asian countries. As the most important route for transportation of hydrocarbons from the Caspian region to Europe, TRACECA has been increasingly used for the transportation of non-oil cargo through the territory of Azerbaijan as well.

Recently Baku hosted a conference dedicated to the 20th anniversary of the signing of the main multilateral agreement on TRACECA, which also became a platform for discussing the prospects for development of the corridor.

Decent answer

"Over the 20 years, TRACECA has made a significant contribution to the promotion of multimodal transport between member countries, creation of favourable conditions for transit traffic, expansion of trade, economic and transport cooperation, as well as the improvement of economic potential of the member nations," Azerbaijani President Ilham Aliyev said in his congratulatory letter to the participants of the anniversary conference. He underlined that Azerbaijan pays great attention to cooperation in the transport sector and considers the current activities within TRACECA as the beginning of a new stage in the development of transport sectors of the member countries.

Both international experts and representatives of national delegations participating at the conference share the position voiced by the President of Azerbaijan. Over the 20 years, the countries participating in the revival of the Silk Road have gone a long way towards the establishment of regional transport and logistics infrastructure. The countries of Central Asia and South Caucasus have made considerable progress in the development of national economies thanks to the improvement of legislation, unification of tariffs and cross-border rules, as well as joint participation in the establishment of transit routes between China and Europe.

However, there were those who had doubted the effectiveness of the Silk Road project. One of them was the Deputy Minister of Territorial Administration and Infrastructure of Armenia Armen Simonyan, who led the Armenian delegation invited to the 14th meeting of the TRACECA intergovernmental commission. The Minister of Economy of Azerbaijan Mikayil Jabbarov responded to the comment of Armenian delegation: "I understand the reaction. I consider that it can be divided in two parts. One of them is related to opinions expressed on TRACECA. I thank my colleagues for their speeches. I think they have clarified what TRACECA contributed to us with enough certainty and simple figures. As an organiser of the event and responsible country for conferences and programs, I consider standing on the issue my own duty. I understand the reaction of our neighbours very well. They came from Yerevan and saw the city themselves. I understand it is not so easy for them to accept what they have seen."

Minister Jabbarov also noted that Azerbaijan supports a constructive approach: "We prefer a constructive approach. However, we know destructiveness is easier, and consequences of this destructive policy are firstly observed in the neighbouring country, which has been isolated from great projects and brought itself to a transportation and economic deadlock, and apparently does not want to get out of there," Jabbarov added.

According to TRACECA Secretary General Mircea Ciopraga, the corridor is officially recognised as "a natural transit bridge connecting Europe and Asia with leading international organisations." Accordingly, the efforts of member nations involved in the project are focused on the further dynamic development of the corridor. "In particular, we continuously take measures to harmonise and simplify regulatory standards, facilitate border crossing, use of advanced transport and information technologies, as well as other factors that can guarantee uninterrupted transport communication in the TRACECA region," Ciopraga said.

300-fold growth

Certainly, the tasks set today will be realised in any way. In the past, many experts doubted the viability of the TRACECA project, as well as the ability of participating countries to form the necessary infrastructure and coordinate transport policy. However, the facts confirm the opposite. The most prominent evidence of the success of the TRACECA project is the multiplication effect that contributed to the increase of the transported volumes over the past 20 years. According to Mr. Ciopraga, the annual throughput of the TRACECA corridor has increased 300 times compared to the end of the 1990s, when it was 200,000 tons. In particular, 1 billion tons of cargo has been transported along the corridor so far, half of which was hydrocarbons.

Today, the corridor linking fifteen states of Central Asia, South Caucasus and Middle East includes such new routes as the Trans-Caspian International Transport Route (TCITR) and Lapis-Lazuli route originating in Afghanistan. Moreover, the TRACECA project participants entered into agreements with Ukraine on the joint implementation of the Viking train transport route (a railway project linking the network of maritime container lines of the Baltic, Black, Mediterranean and Caspian seas), originating in Klaipeda port and further through the territories of Belarus, Ukraine, Georgia and Azerbaijan to Central Asia.

The TRACECA corridor also covers the transit of container railway routes Nomad Express and China Railway Express, multimodal transportation of goods from Central Asia and China to Turkey and Europe and vice versa. So far, over 4 billion Euros have been invested in the implementation of these projects, as well as the establishment of railway and port infrastructures, construction of highways, logistics hubs, renewal of the maritime and container fleet within the framework of TRACECA. Eighty-five projects worth 187 million Euros have been implemented with the European Union.

According to the Minister of Transport and Roads of Kyrgyzstan, Zhanat Beishenov, in 2018 about 1 million tons of goods were transported via the TRACECA through the country, and 2 thousand km of roads were reconstructed as part of the development of the corridor in Kyrgyzstan. One of the priority tasks for Kyrgyzstan is the construction of railways from China to Uzbekistan through the territory of Kyrgyzstan.

According to Deputy Chairman of the Transport Committee of the Ministry of Industry and Infrastructure Development of Kazakhstan, Dauren Sabitov, Kazakhstan has also accomplished a large-scale success thanks to investment of about $30 billion in the development of Euro-Asian transport corridors, construction of more than 2 thousand km of railways in Kazakhstan, and reconstruction of about 20 thousand highways. Currently, the participating countries are focused on the development of the Trans-Caspian route, regular container routes, and the upcoming launch of the container feeder service between Aktau, Baku and Ukhta.

Perspective route

The advantages of participation in the TRACECA project are clearly tangible in Azerbaijan. Thus, Azerbaijan's income from the transportation of commodities over the three quarters of this year increased by 5.3% (more than ₼475 million). TRACECA provides the main volumes of transit for Azerbaijan. The growth of cargo transportation this year was due to an increase in the volume of commodities passing through the territory of Azerbaijan along the One Belt - One Way and TCITR. In particular, this is related to an increase in exports of carbamid, polypropylene, polyethylene and other chemical products from Central Asian countries, as well as the increased supply of industrial and food products from Europe and the countries of the Black Sea region to Central Asia.

Cooperation within the TRACECA and other strategic transport projects has turned Azerbaijan into an important element on the Eurasian map, said Economy Minister M. Jabbarov. Thanks to the Baku-Tbilisi-Kars (BTK) railway corridor, Azerbaijan has become a transport hub of the region. "In the near future, BTK cargo turnover will reach 6 million tons, passenger turnover - 1 million people. Cargo turnover will exceed 15 million tons annually," Jabbarov said.

Azerbaijan is also focused on the expansion of the Baku International Sea Trade Port and the associated Free Economic Zone (FEZ), which in the future will encourage local production and contribute to the recognition of the Made in Azerbaijan brand. In the near future, FEZ will play an instrumental role in international freight transportation and Eurasian supply chains, contributing to the transformation of Azerbaijan into a regional transportation hub covering the South Caucasus, Central Asia, Iran, Russia and part of Turkey with logistics services.

Mr. Jabbarov also emphasized that all the existing initiatives are important not only in terms of receiving financial dividends, but also as a key political factor uniting the countries of the region. "TRACECA was the first element sparking the revival of the historic Silk Road. By combining our efforts, we can increase the attractiveness of the corridor, ensuring its further development," M. Jabbarov said.

In a word, participation in this project helped almost all the countries involved in th TRACECA project to attract investment in the development of transport infrastructure and the renewal of the railway lines, maritime and cargo fleet, as well as the establishment of an effective system of customs and cross-border rules and the adoption of uniform cross-cutting tariffs. This contributes to the attractiveness of the TRACECA corridor for international freight companies.