Review of transport sector in Azerbaijan (January-July 2014)

Analysis Materials 10 September 2014 15:31 (UTC +04:00)

The transport infrastructure is being comprehensively prepared for the goods to be easily transported from Azerbaijan and Central Asia, and in the future from China to Turkey and further to Europe in connection with commissioning of the Baku-Tbilisi-Kars railway in 2015. It has importance for Azerbaijan and the entire region.

These measures include both rail and maritime infrastructure (ferry service and tanker transportation via the Caspian Sea).

Therefore, Azerbaijan buys new carriages, builds a trading port, acquires new ships, simplifies customs procedures, etc.

Taking into account the interest of the various countries in the use of this transportation corridor, the railroad and maritime transport of Azerbaijan must be prepared for a significant increase in the volume of goods transported via it in the future. This envisages a sufficient number of ships and railroad cars. However, it is not expedient to constantly purchase if there is a possibility to produce quality products.

That is why, the construction of a new shipyard near Baku was launched in 2013. A decision was made to build a new carriage works in the city of Ganja (365 km from Baku) this year. The process of building a carriage works is at the design stage, conducted by the Swiss company "Stadler". At this stage, the company is preparing for the construction. It deals with the supply of equipment for the new plant and the expected capacity of the new enterprise.

Other events as of July:

- Russian "Kogalymavia" airline opens flights from Moscow to Gabala from Moscow's Domodedovo Airport, "Azerbaijan Airlines" CJSC (AZAL) said. Another Russian airline - "Ural Airlines" also carries out flights on this route.

- Fitch Ratings has affirmed Azerbaijan Railways Closed Joint Stock Company's (ADY) Long-term Issuer Default Rating (IDR) at 'BBB-' with a Stable Outlook.

- The Gala-Pirallahi highway is being reconstructed in Azerbaijan. According to the Transport Ministry spokesman, the length of the highway after reconstruction will be 21.7 kilometres. A 7 kilometre section will consist of six lanes, while a 14.7 kilometre section will have four lanes. It is planned to construct two road junctions and one tunnel along the highway.

- "Azerbaijan Railways" put into operation the second railway bridge over the River Kura, located on the 73-kilometer Poylu-Salahli railway section. The need for construction of the second railway bridge on the specified section is related to the increased volume of freight transportation via the Baku-Boyuk Kesik railway. The bridge construction began in 2008. Its total length is 208.44 meters.

- The Board of Directors of the Asian Development Bank (ADB) has approved a loan worth $ 250 million for the construction of the Masalli-Shorsulu highway. The total cost of the project is $332 million, of which $82 million accounted for the country's share in the project.

- Azerbaijan Airlines CJSC (AZAL) will open scheduled direct flights from Baku to New York from September 24, 2014. Flights will run from Baku and arrive to the biggest city of North America.

- Brazilian Embraer signed a firm order for two additional E190 jets with Azerbaijan Airlines (AZAL). The total value of the contract is $95.4 million. With this order, now AZAL will operate six E190.

- "Azerbaijan Airlines" CJSC (AZAL) will carry out regular direct flights on Baku-Bishkek-Baku route starting from October 26, AZAL said.

The Azerbaijani transport sector transported 124.9 million tons of cargo in January-July 2014 or by 2.5 percent more than in the same period of 2013, the Azerbaijani State Statistics Committee said.

According to the report, the volume of transported non-oil goods increased by 3.6 percent, reaching 87.6 million tons in January-July.

Around 75.8 percent of the total volume of goods transported in January-July fell to the private sector.

The Azerbaijani transport sector transported 218 million tons of cargo in 2013, which is 3.4 percent more than in 2012.

Some 56.2 percent of all cargo were transported by vehicles, 29.4 percent - by pipelines, 9.8 percent - by railway and 4.6 percent - by ships.

Around 1 billion people used passenger transport in January-July, which is 5 percent more than in the same period of 2013. Most of the passengers were transported by vehicles (87.4 percent) and metro (12.3 percent).

Automobile transport takes the lion share in the transport field of the country. Some 70.2 million tons of cargo were transported by vehicles, which is 2.7 percent more than in January-July 2013. The volume of passenger traffic hit 878.4 million people (a 5.3 percent growth). Some 96.2 percent of the passengers were transported by buses and 3.8 percent - by cars.

Freight turnover by vehicles increased by 2.8 percent during the reporting period, while passenger turnover - by 6 percent.

Some 12.2 million tons of cargo were transported by rail in January-July compared to 13.1 million tons in the same period of 2013.

The number of loaded carriages made up 587 in average per day and unloaded - 597. Average daily load of carriages in the northern direction is 21,100 tons and in western direction 7,000 tons and southern direction - 5,800 tons.

Around 5.7 million tons of cargo were transported by ships compared to 6.9 million tons in Jan.-July 2013. All cargo accounted for international operations. The volume of goods handled in Azerbaijani ports amounted to 7 million tons in January-July 2014.

Some 57.4 percent of cargo shipping fell to oil and oil products, while 42.6 percent on dry cargo. The volume of international transit cargo handled in the ports hit 85.9 percent. As of August 1, 2014, around 92,600 tons of cargo left in the ports for import.

Some 27.6 million tons of oil (a 10 percent growth) were transported via main oil pipelines in Jan.-July 2014. During this period, 75 percent or 20.9 million tons of oil were transported via the BTC (data provided by the State Statistics Committee). Sangachal terminal transported 3.1 million tons of Turkmen oil via BTC in Jan.-July.

Gas transportation via main gas pipelines made up 12.7 billion cubic meters (a 9.3 percent increase) in Jan.-July. Some 28.3 percent of the transported gas fell to the South Caucasus Pipeline. Some 3.6 billion cubic meters of gas were transported via this pipeline.

Some 977,400 passengers were transported by air transport in Jan.-July which is 6 percent more than in the same period of 2013. Some 0.3 percent of shipment by this kind of transport fell to private sector.

Some 124 million people were transported by metro (a 3.6 percent growth) compared to Jan.-July 2013.

Some 28.1 million tons of cargo were transported through the Eurasian transport corridor TRACECA (Europe-Caucasus-Asia) through the territory of Azerbaijan in January-June 2014, compared to 29 million tons in January-May 2013, according to the Azerbaijani State Statistics Committee's report as of the first seven months of 2014.

Around 49.7 percent of the total volume of transported cargo fell to vehicles, 33.9 percent - railway and 16.4 percent - ships.

Some 149.4 million people were transported through the corridor in January-June, which is 7.7 percent more than in the same period of 2013.