DHL, KTZ Express to Provide Increased Connectivity Between China, CIS, Europe

ASTANA – DHL Global Forwarding and Kazakhstan Temir Zholy (KTZ) Express have signed a memorandum of understanding to provide greater rail connectivity between China, Kazakhstan and the countries of the Commonwealth of Independent States (CIS) and Europe, the Post and Parcel website reported on July 1.
“KTZ Express is looking to establish the most advanced Central Asia logistics hub in Kazakhstan by enhancing various facilities across the country and improving our freight forwarding capabilities. The partnership with DHL will not only accelerate our pace towards achieving this goal but will also help us serve multinational corporations with regional needs in these high-potential markets,” said Sanzhar Yelubayev, president of KTZ Express, according to a report by Asia Cargo News on June 30.

The agreement will give DHL additional commercial block train services with KTZ Express, a branch of Kazakhstan’s state-owned railway operator, increasing their overland rail freight routes, according to Post and Parcel. KTZ Express will operate rail connections within Kazakhstan and between Kazakhstan and China, as well as add logistics service locations, including within the Khorgos Special Economic Zone on the border between Kazakhstan and China, and increase its capabilities overall. DHL will focus on developing forwarding capabilities along routes that link China, Kazakhstan and CIS countries, as well as provide logistics expertise and value-added offerings like temperature-controlled containers for transporting sensitive technological material. The agreement also includes the development of additional rail routes along the Silk Road connecting Europe, Kazakhstan and China.

“KTZ Express will work hand in hand with DHL to further develop end-to-end logistics solutions via rail and multimodal solutions in this part of the world. We will continue to work on reviving the Silk Road and increasing our capacity to move goods within the region as its economic growth and development gain critical momentum,” said Yelubayev, according to Asia Cargo News.

CEO of DHL Global Forwarding China Steve Huang noted the “tremendous growth” of rail freight between Asia and Europe over the last few years and the potential for growth in hubs along that route, including in Kazakhstan. “Kazakhstan’s own economic development stands to benefit significantly from strong infrastructural links to China and the EU – its two largest trading partners. Transportation alone makes up more than 10 percent of the country’s services exports,” he said, according to Post and Parcel.

“By partnering with KTZ Express, we hope to provide China-Europe trade expanded services in the pivotal Central Asia region, through investment in both new and traditional trade route infrastructure, like rail enhancements along the South Silk Road, in line with China’s ‘One Belt, One Road’ initiative,” Huang added.

According to the European Commission, daily China-EU trade exceeds $1 billion, making it the second-largest cooperative economic relationship in the world. CEO of KTZ Askar Mamin noted in May that trade between major Eurasian hubs is predicted to increase by 1.5 times, from $800 billion in 2014 to $1.2 trillion by 2020. Kazakhstan hopes for 8 percent of that trade to be transported through its territory, KZT representatives first said in 2013.

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