Kazakhstan’s 2020 Transit Plan Helps Connect Europe and Asia

ASTANA – Recently, the government of Kazakhstan adopted an infrastructure development plan that covers from now until 2020. It was developed in part by the World Bank and previously agreed upon by all impacted state and local agencies and associations. In fact, it is the country’s first large-scale plan for the development of transport infrastructure and its integration into the global transport system.

While presenting the document, Minister of Transport and Communications Askar Zhumagaliyev noted that the project will increase transit by two times, integrate Kazakhstan into the international transport system and develop local infrastructure located outside of city centres.

At the end of 2012, Kazakhstan was ranked 86th on the World Bank’s Logistics Performance Index. However, planned comprehensive measures to improve the quality of transportation, as well as the removal of physical and non-physical barriers, are expected to provide Kazakhstan the opportunity to rise to 40th place in this rating.

The programme seeks to develop all modes of transportation by 2020. Thirty thousand kilometres of roads, 8,202 kilometres of railway and all 302 railway stations will be renovated. The programme includes a number of other measures aimed at the development of transport infrastructure.

Along with the repair and construction of roads, the programme focuses heavily on the development of roadside service infrastructure and passenger traffic. By 2020, it is planned to build 260 roadside service centres. Also, nine bus stations, 45 terminals, 155 service stations and 1,048 passenger taxi stands will be built in the provincial areas of the country.

The document also increases the number of bus routes. Today, regular bus service covers 75 percent of rural villages with a population of over 100 people. Meanwhile, by 2020 it is planned to open 300 additional routes, which will completely cover all villages.

Also, changes will be made in the railroad sector. The Zhezkazgan – Beineu and Arkalyk – Shubarkol lines are under construction. In addition, the line between the Zhetygen station and Kazybek station, which bypasses Almaty, will be built between 2015-2017 through a public-private partnership focused on unloading cargo at the transit hub.

Overall, it is expected that by 2020, 81 percent of state railroads will be assessed as “good” and 19 percent – as “satisfactory”. In addition, in light of the rolling stock fleet shortage, ,more than 650 railroad engines, over 20 thousand trucks and 1,138 passenger cars will be upgraded.

The nation’s airports will also be reconstructed, including 11 of the 18 existing airports. Repairs will be focused on runways and terminals. In addition, by 2020, 75 new international air routes will be opened.

The programme includes the further development of water transport infrastructure. In particular, a project to expand the capacity of the seaport in Aktau by adding three dry cargo terminals, is underway. As a result, the throughput capacity of the seaport will increase from 16.8 million tons per year to 20.5 million tons.

 

Driver of economic growth

“Kazakhstan, with its location on the crossroads of several international transport corridors, meets all prerequisites for becoming a major logistics hub connecting Europe and Asia,” Prime Minister Serik Akhmetov said at a cabinet meeting. He stressed that the President pays special attention to the development of transit potential, the implementation of major infrastructure projects and the integration of the region into international transport corridors.

Kazakhstan Temir Zholy (KTZ), the national railway company, with its full range of assets and competencies, will become the main multimodal logistics operator behind the plan. The company will also operate the Aktau Seaport, SEZ Khorgos – East Gates, the country’s airports and domestic terminal network.

The integration of transport assets into a single structure, according to Zhumagaliev, will provide the necessary level of coordination and management, form integrated multimodal services and introduce a “single window.” This will create favourable conditions for Kazakhstan’s transit capabilities and exports. Dubai World’s acquisition of port and terminal infrastructure in Kazakhstan will give additional impetus to the development of the country’s transport and logistics system. Kazakhstan is negotiating with Swissport International and Lufthansa Consulting on matters pertaining to the country’s airports.

President of KTZ Askar Mamin reported on the development of the transport and logistics system. According to him, to improve competitiveness and increase transit capacity, the company is implementing a business strategy to promote its services and improve its quality and efficiency. Today, 14 freight train routes run between Asia and Europe. As a result, overland delivery times from consolidation centres in China will shrink to 300 percent less than those of traditional maritime routes.

The ability to transit goods through Kazakhstan requires fully developed transportation and logistics infrastructure and its integration into the international system. To do this, the country is implementing investment projects for the development and modernization of infrastructure and the transport and logistics sector. In 2014, the new Zhezkazgan – Beineu and Arkalyk – Shubarkol lines will be commissioned. This will streamline the configuration of international transport corridors in the East, West, North and South and will reduce the Dostyk – Aktau route by 750 kilometres.

The country’s first ever dry cargo sea company will be established by the end of the year. Private companies will fully modernize the nation’s airport over the course of two years and will build a fully formed network of class A and B logistics centres.

A network of transport and logistics complexes, including facilities for the consolidation and distribution of transit flows and centres for the promotion of Kazakhstan’s exports are also being built outside the country.

The Common Economic Space’s key project is the creation of an integrated transport and logistics company. The railway administration of Kazakhstan, Russia and Belarus will provide integrated services based on the principles of the “single window,” which are streamlined technology, standards of quality and price policy. Technological parameters for the infrastructure corridors that feed the main terminal will be developed later.

Kazakhstan’s location also allows the country access to the Trans-Caspian route. Kazakhstan today does not have its own dry cargo fleet and goods are exported from Aktau via foreign vessels. That’s why KTZ is looking to acquire its own dry cargo fleet by 2020. The company’s 20 vessels will make up more than 50 percent of all sea traffic from Aktau. Implementation of the “own cargo – own port – own fleet” principle will foster effective Trans-Caspian freight transportation.

Before the end of this year, a feasibility study for the construction of transport and logistics centres in Kazakhstan will be developed.

The transport and logistics complex is expected to drive economic growth. The overall effect of the gross added value from the improvements to the transport and logistics system will amount to US$15 billion; the average effect on GDP growth will be around one percent, the head of the KTZ national company said.

Summing up the discussion, the Prime Minister stressed the importance and reach of the program: 5 trillion tenge (US$32.4 billion) of public and private investments will be used.

Development of both transit and logistics facilities, said Akhmetov, is unthinkable without the appropriate supporting infrastructure. Therefore, the main task of the programme that was adopted is the development and construction of transportation infrastructure.

In this regard, Akhmetov instructed the Ministry of Transport and Communications and the KTZ project to continue on with its comprehensive action plan for the Kazakhstan: A New Silk Road project. The Prime Minister also instructed local authorities and concerned state bodies to speed up the creation of an airport management firm and to ensure tight control over the commissioning of major road and rail corridors. He stressed that timeliness is key. Among these major roads and railways are the Western Europe – Western China Road, the North – South Road, the North – East Road, the North – West Road and the Beyneu – Zheskazgan and Arkalyk – Shubarkol railways.