Kazakhstan’s transit potential to continue growing until 2020

Astana, Kazakhstan, Oct. 31

By Daniar Mukhtarov - Trend:

Kazakhstan's transit potential will continue to grow until 2020 due to improvement of cooperation between Russia and China, as well as Russia and Iran, according to the Kazakh Cross-Border Cooperation Association's representative Marat Shibutov.

Shibutov made the remarks at a meeting of the expert club "World of Eurasia" in Almaty.

"I wouldn't say we have a lot of potential," he noted, adding that if the West's sanctions policy towards Russia enhances, it will expand the cooperation between Russia and China.

"Accordingly, the transport corridor will start working, and it goes through us [Kazakhstan], and we will get relatively good money from the transit," he said.

Shibutov went on to add that for Kazakhstan it is important to develop trade with Iran.

He said meanwhile, Kazakhstan will need to become a mediator for Iran to conduct trade not only with the European part of Russia, but also with Siberia.

The expert said that Kazakhstan, in terms of transit of goods through its territory, had a positive balance for 5 years and a negative balance for 8 years within a period between 2002 and 2013.

Last year, Kazakhstan received $2.286 billion for the transit through its territory, and paid $2.268 billion for transit through the other countries' territory.

"Basically, we have profit from the transit of Russian and Chinese gas through our territory, which makes about $1.96 billion," he said.

Further, Shibutov said the gas transportation is followed by railway transportations ($850 million) and the motor vehicle transportations ($250 million).

Least of all revenues from the transit are coming from air transportations ($86 million), Shibutov said.

Meanwhile, Kazakhstan pays $895 million for the transit through the territories of other countries with the road transport; $420 million - air transport; $859 million - railway and $91 million - sea transport, he said.

This is while the country hardly pays for the pipeline transit, since the country transports its hydrocarbons to Samara and the third parties take it from there, he said.

The expert reminded that in August of 2014 Kazakhstan proposed Russia to construct a gas pipeline to China though Kazakhstan, since it was planned to lay the pipeline directly to China through the Altai mountains.

So, Kazakhstan put forward a proposal to construct the gas pipeline through Astana and lead it out near the Horgos (or Alashankou) border-crossing point.

As for the railway transit, Shibutov said that China has five railway routes via which it supplies its goods to Europe.

The largest railway route of China, Chongqing - Xinjiang - Kazakhstan - Russia - Germany, delivers goods to Europe 16 days earlier than the sea route from Chongqing to Hamburg, however the high tariffs imposed by Russians undermine its expedience, Shibutov believes.

"Therefore, China uses this route one or two times a week, which is not so frequent. That's to say, the tariffs of the Russian Railways are the obstacles for us," he said.

He talked about the Moscow-Beijing Eurasian high-speed rail transport corridor project which includes the Moscow-Kazan high-speed rail project.

"Perhaps, after the implementation of this project the transit tariffs will be reduced, which is beneficial for Kazakhstan," the expert said.

Edited by SI

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