The development of the economic systems of Europe and Asia is outpacing the level and pace of integration in the transportation systems of the countries located between them. This problem can be solved by creating an overland chain across the entire Eurasian space. As part of the development of its transit potential, Kazakhstan has started to form the backbone of such a terminal network.
All work on creating transport networks has been entrusted to the national company, Kazakhstan Temir Zholy (KTZ), which plans to integrate all modes of transport to offer a comprehensive range of client services under a ‘one-stop-shop’ principle and enhance international operations. Establishing a terminal network outside of the republic will improve freight logistics and help build efficient supply chains.
This decision is driven by market demands for cargo delivery, which go beyond mere transportation needs and require the provision of a comprehensive transportation product by a single logistics operator.
Where Cargo Flows Begin
Developing cooperation with China plays a crucial role in integrating Eurasian transport space. In 2023 alone, transit freight traffic between Kazakhstan and China reached a record 28.3 million tons. This success was partially due to the development of a terminal network in China – the Kazakhstan-China logistics terminal in the Pacific port of Lianyungang has been operating for ten years, and the largest dry port in Central Asia, Khorgos – Eastern Gate, operates on the border.
The transport system between these two ports facilitates the delivery of goods from China’s eastern coast to Europe via the Caspian Sea, ensuring the shortest delivery times. Adding the new Kazakh terminal in Xi’an to this transport chain has optimized logistics processes and boosted transportation performance. In the first eight months of 2024, container transit from China along the Trans-Caspian International Transport Route (TITR) increased 20-fold thanks to the freight terminal in Xi’an, a project was implemented in partnership with the Chinese company, Xi’an Free Trade Port Construction and Operation.
Focusing on EAEU Transport Potential
Significant steps have been taken to harness the transport potential of the Eurasian Economic Union (EAEU) countries. In April, construction began on a new terminal at the Selyatino station near Moscow. A trilateral Kazakhstan-Russia-China agreement on creating the CRK Terminal transport and logistics center has been signed by KTZ, SlavtransService, and Xi’an Free Trade Port Construction and Operation.
This logistics hub, based in one of the largest dry ports in Selyatino, will develop direct transport links between Xi’an, Russia, and other countries. Its launch is expected this year.
Additionally, in the fall of 2024, KTZ signed a Memorandum of Understanding with Chinese and Belarusian partners to build a new logistics terminal in the Belarusian city of Svisloch.
Caspian Priority
To further integrate Kazakhstan into the key Trans-Caspian International Transport Route (TITR) plans are underway to create an inter-modal freight terminal in Azerbaijan’s Alyat port. An agreement for the project’s implementation has been signed between SK-AIH Investment Fund Ltd, KTZ, Baku International Sea Trade Port CJSC, and Xi’an Free Trade Port Construction and Operation Co., Ltd.
The project aims to boost container train volumes along the China-Europe-China route via TITR, reduce delivery times, lower transportation costs, and improve transshipment efficiency. The Alyat terminal, with a capacity of ten million tons per year, will include a universal freight platform, a 5,000-square-meter covered warehouse complex, and space for over a thousand containers.
The First European Step
November 2024 marked significant developments in Kazakhstan’s transport sector, with the country poised to enter the European transport market for the first time. A Memorandum of Cooperation in transport and logistics was signed in Budapest during President Kassym-Jomart Tokayev’s state visit to Hungary.
The agreement between KTZ, L.A.C. Holding, and Xi’an Free Trade Port Construction and Operation Co., Ltd. involves the construction of a terminal with an annual capacity of 230,000 TEUs. This will increase the number of container trains to and from Europe, and shorten cargo delivery times, thus reducing the cost of transportation.
The Iranian Vector
The Iranian direction holds great interest and potential for Kazakhstan’s export and transit goods sector, offering wide access to southern Iranian ports and onwards to India, the UAE, and Africa. As part of the North-South International Transport Corridor development, 15 hectares of land in the Iranian port of Bandar Abbas were reserved in 2022 for a terminal.
The advantage of establishing a logistics terminal here, alongside developing overland routes through Turkmenistan and sea routes via the Caspian, is the high-speed movement of goods between EAEU countries and South Asia, East Africa, and the Middle East. The importance of the North-South route has grown amid geopolitical shifts in traditional logistics directions. In the first ten months of 2024 alone, cargo volumes along this corridor reached 1.8 million tons.
