July Digest, 2024

At the beginning of July, the first freight train left China on the new route of the Middle Corridor in the direction of Turkey. A train consisting of 110 containers, loaded with household appliances and essential goods, departed from Nanjing, the capital of Jiangsu Province, China, in the direction of Istanbul.

Georgia will enter another transport corridor. Turkmenistan, Azerbaijan, Georgia and Romania will sign a quadrilateral intergovernmental agreement in Bucharest on the establishment of the international transport corridor "Caspian Sea - Black Sea". According to the Ministry of Foreign Affairs of Turkmenistan, the quadripartite agreement will be signed this year.

From July 2024, the Georgian cargo airline Georgian Airlines started operating on a new cargo route, and flights and cargo transportation will take place on the Tbilisi-Meylan-Turkmenabat-Tbilisi route. The implementation of the mentioned route aims to strengthen trade and economic cooperation between Turkmenistan and Georgia.

Soon, a passenger ferry will start sailing between Batumi and Port Constanta in Romania. Shalva Tsakadze, as the managing partner of the project implementing company E60 Shipping Line, states that passenger transportation is planned to start by the end of the summer of this year.

Turkey increased the cost of passage through the Bosphorus and Dardanelles by almost 15%. Until now, the fee was $4.42, and from July 1, it will be $5.07. As for larger ships, a 10,000-ton freighter would pay a total of $3,240 in transit until 2022. Taking into account the new transit rates, such a ship will have to pay $20,370.

The Black Sea underwater electric cable may become the basis for the creation of a new, green corridor. Along with the technical and economic study for the construction of an underwater power line, it turns out that Azerbaijan, Uzbekistan and Kazakhstan are also considering the possibility of building a trans-Caspian submarine line. If such a power transmission line is built, it will create a unified system of transportation of electricity produced from renewable sources by Kazakhstan, Uzbekistan, Azerbaijan and Georgia to Europe. Practical work on the construction of the Trans-Caspian fiber-optic cable line is expected to begin in 2024.

The European Investment Bank (EIB) will allocate a loan of 137 million euros to Armenia for the construction of the "North-South" highway. The project is financed by the European Investment Bank together with the EBRD. Currently, we are talking about the Sisyan-Kajaran section (fourth tranche), the length of which is 24.25 km.

Soon the "Yellow Sea" will be connected to the "Black Sea" through the "Middle Corridor". On August 6, 2019, the world's largest port operator "Shandong Port Group" - Shandong Port Group Co Ltd (SPG) was established, in which the Yellow Sea ports Qingdao, Zhizhao, Yantai and Bohai Bay. SPG operates 19 port areas and 324 industrial berths. The company serves more than 200 container routes covering more than 180 countries. In 2021, the group handled more than 21 million TEU and ranked third in the world. On April 14, "Kazakhstan Railways" signed a memorandum of cooperation with "Shandong Port Group", which should connect the trade logistics systems of China, Central Asia, the Caucasus, the Eurasian Economic Union and the Middle East.

According to the data of the "Transcaspian International Transport Route Association", 1,647,000 tons of cargo were transported through the so-called "Middle Corridor" in 6 months, the annual increase is 27%. In 6 months of 2023, the cargo turnover on this route was 1.3 million tons.

Poti seaport served 272,178 TEU containers in the first half of 2024. According to the data of APM Terminals Poti, from January 2024 until today, the most - 53 129 TEU containers were processed in the port in May. The annual decrease in container recycling is 7.6%. In 6 months of 2023, 294,676 units of containers were processed, in 6 months of 2022 - 166,990 TEU.

Ferry loads have increased in Poti sea port. According to APM Terminals Poti, the growth compared to last year is impressive. In 6 months of 2024, ferry cargo amounted to 81,816 tons, and in 2023 it was only 562 tons. In 2022, this figure was 70,373 tons.

The Liner Shipping Connectivity Index (LSCI) of the United Nations Conference on Trade and Development is at the top, followed by the Republic of Korea and Singapore. The index covers more than 180 countries and shows a country's level of integration with the global shipping network. The index is updated quarterly. According to the data of the second quarter of 2024, Georgia is in 119th place.

"Ukrainian Railways" will receive 42.95 million euros through the European Union's transport infrastructure financing instrument "European Union Fund". The allocated money will be used for the development of the European railway network. The total cost of the project is 85.91 million euros. The CEF fund will finance 50%, and the rest - the Ukrainian side. The project envisages the planned reconstruction of railway facilities and laying of the European gauge (1435 mm) railway line from Chop to Lviv. Chop is a major transport hub between Ukraine, Hungary and Slovakia. Within the framework of the project, it is planned to develop a strategy for the reconstruction of the Lviv railway junction, taking into account the perspective of the expansion of the Trans-European Transport Network (TEN-T) in Ukraine.

Armenia is working on the project of construction of "dry port" and industrial zone, technical and economic justification of the project of "Shiraki dry port" has already been carried out. With the implementation of the project, a logistics center, an industrial zone, a free economic zone, and warehouse zones will be created in Gyumri. It will allow transportation of goods and cargo in any direction, both by air and by rail. The project envisages the creation of an industrial park, as a result, creation of new jobs, improvement of the transport system. Let's add that the concept of "dry port" is spread all over the world and is especially relevant for Armenia. Functionally, a "dry port" is practically no different from a sea port, only rail cars and trucks are used instead of ships.

Azerbaijan is working on increasing the capacity of the South Caucasian Pipeline (SCP). According to Azerbaijani media, Baku wants to fulfill the task of increasing gas exports to Europe. According to the President of Azerbaijan Ilham Aliyev, the goal of Azerbaijan is to double the transportation of Azerbaijani gas to Europe.

According to Otar Sikharulidze, director of Tegeta Academy, training centers will be opened in Batumi and Poti. Transford, a subsidiary company of the PACE Group, will be a partner in port training. At the Batumi location, the direction of cars, truck and special equipment repair will be presented, and a new profession - sales consultant will be created in the direction of cars and truck vehicles.

An agreement on renewal of ferry traffic between Georgia and Bulgaria was signed. The agreement was signed during the visit of the representatives of the BDZ of the Bulgarian Railways and the shipping company P.N.A LTD to Georgia. Dates for resumption of ferry service will be confirmed later.

 According to the Civil Aviation Agency of Georgia, the volume of cargo transported by air in 6 months of 2024 increased by 23% year-on-year and amounted to 11,022 tons. With a 27% share, the market leader is still TURKISH AIRLINES, followed by GEORGIAN AIRLINES with 18.4% share.

The State Railways of China wants to participate in the joint company established by the railways of Georgia, Azerbaijan and Kazakhstan, which was established at the end of last year for the purpose of coordinating cargo in the Middle Corridor. At the meeting of the delegations of the Chinese and Georgian railways, the discussion touched on the project of modernization of the main highway of the Georgian railway, after the completion of which the capacity of the Georgian railway will increase even more. The conversation also touched on the Baku-Tbilisi-Kars railway line, which will be put into full operation in the near future.

Most economists polled by the PMC research center in June would prefer a company with a better international reputation to participate in the Anaklia port project instead of a Sino-Singaporean consortium. This is stated in the second quarter edition of "Economic Climate of Georgia" published by the Center.

In January-June of this year, 19,238.6 thousand tons of oil were transported through pipelines in Azerbaijan, which is 2.1% less than a year ago. According to the Transcaucasian State Statistics Committee, during the reporting period, 1,468,000 tons of oil were transported through the Baku-Tbilisi-Ceyhan pipeline. Which is 9.75% higher than the first half of last year. Of this, 18.6% or 11,773.9 thousand tons of oil was produced in Azerbaijan, 2694.8 thousand tons of oil in Turkmenistan and Kazakhstan.

The US is currently evaluating potential areas of infrastructure investment where the US government can contribute project advisory technical assistance, project preparation and/or financing for the tangible advancement of strategic projects in the Trans-Caspian Corridor. Washington indicates the need to scale up investments in infrastructure projects.

TRACECA.GE

Source: accentnews.ge; commersant.ge; businessinsider.ge; europetime.eu; bp.ge; ge.armradio.am; rail-news.kz; bm.ge