RAIL IN COMPARISON

Kazakhstan 2014 | TRANSPORT | REVIEW: TRANSPORT

Getting from one side of a massive country like Kazakhstan to the other is no mean feat, but if the government can pull off the development of an effective corridor, then the country will become prime hub material.

By 2020, Kazakhstan hopes to have significantly boosted its credentials as a logistics thoroughfare via a vast transport project connecting Europe and Asia. Drafted in collaboration with the World Bank, Kazakhstan has earmarked over $32 billion of public and private investment in order to realize its Eurasian transport dreams. According to the Astana Times, the completion of transport and logistics improvements could boost GDP growth by a full percentage point, while Ministry of Transport and Communications figures have suggested that it could increase, from 86th to 40th, Kazakhstan's position on the World Bank's Logistics Performance Index through doubling transit cargo passing through the country by 2020.

And the project is unlikely to struggle to find the funding it needs, already having attracted $20 billion in investment over the past five years, according to information released by the Ministry, some of which went toward the renovation and construction of 1,700 kilometers of rail and 19,000 kilometers of road. Today, the transport sector represents 7.5% of GDP.

ROADS

In 2009, the World Bank measured Kazakhstan's total road network at 96,846 kilometers. According to the 2020 plan, some 30,000 kilometers of that network, deemed to be of poor quality, will be renovated. Indeed, the Union of Road Builders suggested in 2013 that 30% of roads were in sore need of repair, suffering from potholes, defects, and, sometimes, a lack of markings, often as a result of insufficient funding. In 2014, 2,300 kilometers of significant roads will be repaired, according to the Ministry, while in the same year a 157-kilometer stretch of the Western Europe-Western China corridor will also be opened. The 2020 plan also envisages the construction of over 250 roadside service stations, nine bus terminals, 45 bus stations, and over 1,000 taxi ranks. The plan will significantly extend bus services to rural communities, with 300 more routes set to open specifically to service smaller population centers.

RAILWAY

Kazakhstan has approximately 15,000 kilometers of rail (of which around one-quarter is electrified), a medium the country relies on for much of its heavy lifting in terms of freight and passenger traffic. In addition to building new capacity, the government's 2020 plan calls for the renovation of 8,000 kilometers of track, as well as all 302 stations and numerous engines and carriages. The network is managed by Kazakhstan Temir Zholy (KTZ), a state-owned enterprise, while repair facilities are largely privatized and private firms are allowed to operate rolling stock along the network.

AIR & SEA

The 2020 plan also envisages the development of the country's ports and airports. Of the country's 18 airports with scheduled passenger services, 11 have been marked for reconstruction, while 75 new international routes are expected to have been opened by 2020. In the maritime arena, Kazakhstan has set the development of the Port of Aktau, the country's prime maritime hub on the Caspian Sea, high on its agenda. The 2020 plan also outlines the construction of Kazakhstan's first national cargo fleet, at some 20 commercial ships, according to the Astana Times. In late 2013, the KTZ struck a deal with DP World, a Dubai-based global port operator, which will now advise on the development of the Port of Aktau, as well as the Khorgos Special Economic Zone (SEZ) and Inland Container Depot (ICD), on the Chinese border. The projects, at opposite ends of the country, underpin the government's strategy to develop a new Silk Road, linking Europe with Asia. And in a land far, far away, construction of the Kazakhstan Logistics Terminal began in Lianyungang, on China's east coast. The deal goes back to 1995, when an agreement was signed to allow Kazakhstan to use the port for cargo traffic, while in 2013 Kazakhstan was granted territory to construct its own terminal over 21.6 hectares. In February, the Kazakhstan-China International Logistics Company of Lianyungang joint venture was created, with President Nazarbayev stating that bilateral trade with China had the potential to reach $40 billion by 2016, up from just over $20 billion currently.

WESTERN EUROPE-WESTERN CHINA

The Western Europe-Western China International Transit Corridor forms a key part of Kazakhstan's hub dreams, and involves the renovation of the main roads between the west and east of the country to boost safety, allow heavier vehicles to traverse, and permit faster speeds to be attained—and there is certainly demand for heavy trucks, with KAMAZ Kazakhstan reporting growing demand; “over 2013, we saw very positive growth rates in the heavy vehicle and tractor business," said Director Marat Sirazetdinov Sagitovich. The Kazakhstani portion of the project will cost $5.6 billion, and is scheduled for completion in 2015, according to the World Bank. The Asian Development Bank (ADB) estimates that the completion of the corridor could raise the country's GDP by 68% above its 2010 baseline, as well as boost the GDP of neighboring Central Asian countries by 43%. Central Asia Online also reports that shorter transit times could save $230 million a year in transport costs, with the World Bank also suggesting 30,000 jobs could be created across five regions. Kazakhstan's key position along the re-emerging Silk Road will be crucial for its future growth plans, with no expense being spared to ensure transit a speedy experience.