Tatyana Gracheva

A study tour to Kazakhstan, Azerbaijan and Georgia aiming at finding opportunities to increase trade along the Trans-Caspian route is being held on May 16-24, 2022 by the U.S. Agency for International Development (USAID).
The great potential of this international transport corridor for trade and business development as an alternative means for transporting goods from Central Asia to Europe is obvious. According to the official website of the U.S. Embassy and Consulate in Kazakhstan, a great focus has been placed by Central Asian governments on increasing the transport of cargo via the Caspian Sea, as traders have growing difficulties in moving their goods through the current transit routes.
USAID’s Trade Central Asia activity is implementing this study tour in collaboration with the Transport Corridor Europe-Caucasus-Asia (TRACECA) and KazLogistics, the Union of Transport workers of Kazakhstan.
According to Robert Parker, USAID/Central Asia’s Regional Trade Officer, Trans-Caspian Corridor route can play an important role as a means to trade goods from Central Asia with Caucasus and European countries. The cooperation of these countries and decisions that will lead to an increase of regional trade and investments are welcome.
The Caspian Sea ports at Alyat and Kuryk, and the Batumi Port on the Black Sea are being visited by a delegation of over 40 customs representatives and staff of transport policy government agencies of Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan and Uzbekistan, as well as by members of the Central Asia Transport and Logistics Partnership. Each port’s pricing policy is being studied, processes utilized are being reviewed, and digitization initiatives are being studied. It helps to develop recommendations for further simplifying procedures.
Representatives of national associations of road carriers, logistics companies and freight forwarders, seaports and shipping companies from Azerbaijan, Georgia and Central Asian nations, directly involved in international road transport will also join the tour. The organizers invited participants from Bulgaria and Turkey to familiarize them with the possibility of facilitating international road transport through their domestic territories.
At the same time, the shipping of pre-selected cargo along the proposed alternative route, from Central Asia through the port of Kuryk in Kazakhstan via Azerbaijan, Georgia to Turkey has been piloted by USAID, to identify the specific issues carriers may face when transiting these ports.
Improvement of region-wide trade connectivity and harmonization, economic growth’s acceleration and economic opportunity’s increase in Central Asia, through harmonizing customs and border procedures, increasing public-private dialogue on cross-border trade and investment, improving cross-border firm-to-firm connectivity, and addressing gender relevant trade issues is the goal of USAID’s Trade Central Asia activity.

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According to the Center for Economic Reforms Analysis and Communication of Azerbaijan, national exports hit $11.8 billion in January-April 2022 (the non-oil sector amounted to $965.5 million).
Compared to the corresponding period of 2021, non-oil exports grew up by $268.6 million, or 38.5 percent. Fruits and vegetables export rose up by 23.6 percent and reached $162.6 million.
Exports of chemical products showed growth by 9.9 times, aluminum and aluminum products by 90.6 percent, cotton yarn by 19.8 percent, cotton fiber by 6.8 percent, and ferrous metals and their products by 53.3 percent.
Totally, exports in April 2022 reached $3.8 billion dollars. Non-oil exports grew up by 22 percent to $238.3 million. During the reported period, food exports rose up by 6.2 percent and equaled to $51.4 million and non-food exports grew up by 27.2 percent ($186.9 million).
Totally, Azerbaijan’s exports reached $22.2 billion last year, including $2.7 billion in the non-oil sector.
According to Azerbaijan’s Economy Minister Mikayil Jabbarov, the growth in the non-oil products export demonstrates the Azerbaijani economy’s sustainability, in spite of pandemic.
Sustainable diversification of the economy should be set, and a concept contributing to the growth of non-oil exports is to be planned. By 2025 the amount of non-oil goods exports should be doubled.

The first freight train from China via Azerbaijan is launched by Finland.
The launch of the first container route from China bypassing Russia was announced on May 10 by Finnish largest freight operator Nurminen Logistics.
The company reported that Nurminen Logistics’ first full-size container train departed on May 10, 2022, from Chongqing, China, on the new southern trans-Caspian route.
Starting from China, the route passes through Kazakhstan, Azerbaijan, Georgia, and Romania to Central Europe. It was built in two months together with Kazakh railroads. The company’s office in Russia was temporarily closed in March.
According to the company, the new route is in great demand, and the next train, departing on May 25, is already nearly full. Since June departures are scheduled every week.
On March, 16 a commercial use agreement between Nurminen Logistics and Kazakh State Railways was signed in order to develop the Trans-Caspian International Transport Route.
Today logistics is a geopolitical issue but not only an economic one. The Trans-Caspian route, combining rail and maritime transport, perfectly suits the needs of modern transportation chains.
More countries seek ways to bypass Russia, which makes transport routes through the South Caucasus increasingly popular. From this perspective, Azerbaijan is irreplaceable as a regional transportation hub, because different transportation routes, such as Baku-Tbilisi-Kars, North-South corridor, Trans-Caspian international transport route, and the new Silk Road, pass through the country.
A railway route to Germany, allowing trains to bypass Russia, was also launched on April, 13 by China. The route passes through Kazakhstan, Azerbaijan, Romania, Hungary, Slovakia, and the Czech Republic, crossing the Caspian and Black Seas by rail and sea.
The launch of a block train from China to Europe in transit through Azerbaijan was reported by the representative office of German company Hellmann Worldwide Logistics in Azerbaijan and its partners. It will leave from the Chinese city of Suzhou to the border of Kazakhstan by rail, and then will be loaded and shipped from Aktau port to the port of Baku. Cargo will be delivered by the block train not only for transit to Europe but also for the domestic market of Azerbaijan.
Consequently, it is difficult to overestimate the significance of the North-South corridor for Russia now, especially in context of the sanctions.
Azerbaijan is becoming a new leading logistics center in the reorganization of global supply chains in Eurasia, due to its strategic central position between Europe and China and developed aviation, rail, pipeline, and maritime infrastructure.
The Trans-Caspian transport route is a vital trans-Eurasian corridor, running through the South Caucasus. The route, beginning in Southeast Asia and China, travels to Europe via Kazakhstan, Azerbaijan, Georgia, and Turkey. It is the Middle Corridor of the ‘One Belt, One Road’ project, one of the new Silk Road routes. Profitability, safety, reliability, and stability of this transport corridor were proved during the crisis. Consequently, the attention of an increasing number of exporters and importers is attracted by this corridor, running through Azerbaijan.
In light of the present situation, the potential of Azerbaijan to become one of the transport and logistics hubs transferring freight traffic is obvious.

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