Kazakhstan to Modernize Transit Infrasructure
Roman Sklyar, Vice Minister of Transport and Communications of the Republic of Kazakhstan, answers questions from the Kazakhstan magazine.
The transport and communication complex is the backbone of the economy of Kazakhstan. Can you give an assessment of the current condition and performance indicators of the sector?
Over the past two decades, the backbone role of transport in Kazakhstan increased greatly. A competitive market environment is created that has made it possible to accelerate the integration of the domestic transport sector in the international transport system and to develop the transit potential of the country. Owing to the creation of a favorable investment climate, the funding of the industry rapidly grows from year to year, attracting large loans from international financial institutions.
Reliable and efficient transport networks provide a framework for deepening regional economic cooperation and trade in the region, located in the heart of the Eurasian continent.
Today there is a steady upward trend in the volume of cargo freight and transportation of passengers, as well as in the throughput capacity of railways and airports. According to the latest data of the Agency for Statistics, the physical volume index of the transportation sector in January–June 2012 was 107.2%, compared to the same period last year. Cargo transportation by all modes of transport rose by 20.4%, freight turnover increased by 18.1% to 170.6 billion tones per kilometer, and passenger transportation increased by 23.3% to 98.7 billion passengers per kilometer.
Talking about the performance indicators of infrastructure, more than 700 km of new railways was constructed over the years of independence; this considerably reduced duration of transportation within the country. About 40 thousand kilometers of roads were brought into good or satisfactory condition. The renovation of 10 airports in the country was carried out, and now they meet the ICAO requirements. The throughput capacity of the sea port of Aktau increased; its current share in the total freight turnover in the Caspian Sea is 31%.
In addition, a developed network of transit routes was created; it covers three priority areas: Russia – the countries of Europe and Asia; China, Japan and the countries of South-East Asia; Central Asia countries, Caucasus, the countries of the Black Sea and Persian Gulf, and Turkey.
The five international transport corridors run through the territory of Kazakhstan in the framework of the above-said transit routes: the North corridor of the Trans-Asian Railway, South Corridor of the Trans-Asian railway, Central (Central Asian) corridor, North-South, and TRACECA. In their turn, these corridors inside the country are divided into six rail and six road corridors. Moreover, several international air corridors run through its air space of the republic.
It is known that with the launching of new productions as part of the Accelerated Industrial and Innovation Development Program, the load on the transport infrastructure of Kazakhstan keeps growing steadily. What measures are provided for the advanced development of the sector? What problems, in your opinion, will have to be addressed in the first instance?
As you know, in accordance with the task set by the President, the State Program on Accelerated Industrial and Innovative Development in Kazakhstan till 2015 was developed. As part of it, the 2010–2014 Transport Infrastructure Development Program, currently in operation, provides for implementation of more than 60 infrastructure projects, worth of 2.8 trillion tenge (over $19 billion).
In 2011, as part of the sectorial program, the construction of facilities related to the first start-up complex of the railways Zhetygen – Korgas and Uzen – State Border with Turkmenistan was completed. It is planned to construct and renovate about 50 thousand kilometers of roads, to carry out works on renovation and modernization of the airport infrastructure and development of the national merchant marine and the sea ports infrastructure.
Here, it is worth noting the largest projects are to improve the technical condition and to increase the throughput capacity of land-based international transit corridors. In the first place, it is certainly the initiative on reviving the Silk Road – the implementation of a megaproject to create a transcontinental road corridor from Western Europe – Western China, with total length of 8,445 km, including 3,425 km via the territory of China, and 2,233 kilometers via Russia. The Kazakh part of the corridor runs via five oblasts in Kazakhstan and has the length of 2,787 km, of which 2,452 km are subject to renovation.
This project was launched in the country in 2009, and the completion of the corridor construction is scheduled for 2015. The work is currently in progress in four regions at 34 sites with the total target length of over 1,700 km.
This road is the shortest route from China to Europe, with a minimum number of member countries, and hence the borders. The completion of the project will reduce the time of delivery of cargo by motor transport from China to Europe by almost 3.5 times. Furthermore, the launch of the new corridor will increase transit traffic by routes from China – Central Asia and China – Russia – Western Europe by 1.5 times by 2015.
In parallel, work is under way on other major international road transit corridors.
For Kazakhstan, the key point for international transit is the international railway pass Dostyk – Alashankou, bordering with China. As a result of measures taken, the capacity of the Aktogai – Dostyk section and the railway pass Dostyk – Alashankou will increase to 20 million tons by 2020.
The successful railway projects Zhetygen – Korgas and Uzen – State Border with Turkmenistan, currently under implementation, add to setting up of new routes in the directions of East – West and North – South both for Kazakhstani products and cargo transit. Regarding the second project, it will make it possible to optimize the route for consignment of cargo to the Middle East countries, giving direct access to Turkmenistan, Iran and the Persian Gulf countries. In its turn, the railway Zhetygen – Korgas opens the second crossing point with China and gives the possibility to increase cargo transit from China to the countries of Europe and Asia and to reduce the distance of freight by 500 km in the direction of Asia – Europe.
The opening of the international railway border crossing with China will have a positive effect on development of the free trade area at the Khorgos border post.
However, to further develop the optimal network of railways, this year Kazakhstan has launched a project of construction of new railways, namely Zhezkazgan – Beineu (988 km) and Arkalyk – Shubarkol (214 km).
It should be noted that under the programs of diversification of the economy, the conditions for technological breakthrough in the field of railway transport were created. A set of projects to create new production facilities of railway engineering is in progress, implemented on the basis of Kazakhstani enterprises, with participation of the world's leading manufacturers, such as General Electric, Talgo, Siemens, and Alstom. Each of the projects provides for a high degree of localization of production of components and spare parts. These projects are aimed at reducing the wear and tear of rolling stock and at further industrialization of the economy, as a whole.
Special attention is paid to the development of air transport. The sectorial program involves the implementation of 13 projects on renovation of airports, funded both from the budgetary and extra-budgetary sources.
International cooperation with foreign countries expands. To date, air service has been established with more than 20 countries, covering the CIS and other foreign countries. Measures are taken to develop the domestic airlines.
A project to expand the sea port of Aktau in the northern direction that involves several stages is under implementation now. Owing to that and also to modernization of the existing equipment and introduction of new technologies, the total capacity of the sea ports in Kazakhstan will raise from 14 million to 17.5 million tones. Rapid development of the domestic merchant fleet in the Caspian Sea is one more positive trend.
If we talk about the problems impeding the development of international freight, among the most serious ones one can call inefficient systems of cargo handling and accompanying documents processing, also the lack of logistics infrastructure and rolling stock (eg., the grain carriers). I think we would be of greater interest to international carriers and considerably improve our transit potential, if we continued large-scale renovation of roads and railways, eliminated redundant inspections and barriers created by the regulatory agencies, as well as eliminated a large number of charges, including informal ones. However, efforts to address these issues are already underway.
As part of development of the transit potential of Kazakhstan, the Ministry of Transport and Communication intends to continue work on introduction of modern and advanced principles, aimed at managing the supply chains and contract logistics, as well as innovation and information technologies. Jointly with the Customs Control Committee, we intend to engage in improving the efficiency of customs procedures. Further development should be given to container shipping. This is very promising and popular trend. We will focus on the creation of attractive conditions for servicing transport companies. The network of airports and high-speed railways should be given further development.
Regarding passenger freight in Kazakhstan, the issues of creating a multi-modal system of transport nodes and high-speed corridors, connecting the major economic centers and towns within agglomerations will be worked out. The upgrading of rolling stock and the construction and renovation of roads that form the transit corridors are also among the priorities. A large emphasis is made on development of motorway service along these routes.
In the area of transport control an automated system of weighting trucks in motion will be introduced. This measure will make it possible to avoid multiple inspections and repetitive weighting of trucks while going along the transport corridors within the country.
Work is also underway to improve the international legal framework. Efficient and reliable operation of the Eurasian trans-continental routes can be achieved only due to joint efforts of all member-states involved in the route at their national borders, as well as to joint solutions of global problems. International organizations and the application of internationally recognized documents, standards and best practices developed by them play an invaluable role in this.
In the framework of the Customs Union, measures are taken to ensure the growth of transit potential, efficient and safe operation of transport systems of the member countries, which will contribute to successful integration. In general, experience shows that the Customs Union by removing obstacles in cross-bordering makes a significant contribution to the creation of effective international transport corridors connecting China with Europe.
Introduction of new technologies and automation of control procedures along the corridors will help to eliminate non-physical barriers. Thus, the implementation of the Agreement on Introduction of an International Certificate for Weighting Trucks in the CIS Countries makes it possible to avoid multiple inspections and repetitive weighting.
To raise the attractiveness of transport corridors, the task is set to set up a modern and efficient logistics infrastructure. The building of a high-tech transport system, based on fundamentally new infrastructure solutions, and the formation of uniform transport and logistics centers will allow at a quite new level to regulate traffic flows both within the country and on international routes.
At the last meeting of the Foreign Investors Council the President of Kazakhstan invited investors to participate in the New Silk Road mega-project. Could you tell us more about this? What role in implementation of this project will the development of multimodal freight play?
Having initiated the New Silk Road project, the President outlined the main priorities of the state in the formation of large transport and logistics communications, ordering the Government jointly with the Foreign Investors Council members to discuss the project before the end of the year, and to develop a comprehensive plan of action in this regard.
The competitive advantage of the project is the revival of the Silk Road and the increase in the transit transport potential of the country. The concept of the project includes the creation of a single complex of international level hubs, related to trade and logistics, finance and business, innovations and technologies, and tourism at the key international transport corridors in Kazakhstan. As a result, by the year 2020 the volume of transit traffic via Kazakhstan is expected to increase twice to about 50 million tons a year.
The New Silk Road, of course, will involve all major infrastructure projects being implemented in the republic today, such as those I have already mentioned – the international transport corridor Western Europe – Western China, the construction of the Zhezkazgan – Beineu railway, the renovation of the port of Aktau, the project of restoring the road sections Aktau – Beineu, Zhetybai – Zhanaozen – the Border with Turkmenistan, and Beineu – Akzhigit – the Border with Uzbekistan, as well as the new railways Zhetygen –Korgas, Uzen – the Border with Turkmenistan, put into service, and etc.
I would like to note that today the necessity for the development of multimodal freight has emerged in Kazakhstan. This implies the delivery of same cargo in stages by several modes of transport. To date, this is a very common form of cargo delivery for middle and long distances, thanks to which, it is possible to implement the "door to door" principle of delivery. With this, the mode of delivery by sea, rail, road or air can be mixed in any combination.
Our ministry has already started working in this direction. It initiated jointly with the Customs Control Committee of the Ministry of Finance and the National Secretariat of TRACECA a project of multimodal route, called SilkWind.
The main advantage of this route, which will connect the countries of Europe with China via Kazakhstan, Azerbaijan, Georgia and Turkey, is the construction of the straightening railway Zhezkazgan – Beineu, which will make it possible to reduce transit via our country by one thousand of kilometers. The attractiveness of the route is caused also by the factor that for Kazakhstan, it is the shortest access to the ocean. By providing a direct connection between the big "cargo producing" countries by using the railway and road transport and the ports of the Caspian Sea and Black Sea, and the rail tunnel under the Bosphorus (which allows to reach the borders of the EU), the route will reduce the time of cargo delivery to 12 days. Having initiated the SilkWind project, our Ministry, together with the Customs Control Committee, is working on simplification of customs procedures, on eliminating administrative barriers at the borders, and on organization of information exchange between the customs bodies and operators, and on reducing the transit time and delivery time.