New Freight Port in Iraq Offers Kazakh Companies Long-Term Prospects

The Association of Kazakhstan Freight Railway Carriers is reporting that an Emirati company, AD Ports, is planning to build a new port and economic zone. The area that the company has identified for the zone is located to the south of the Iraqi city of Basra; if the project goes ahead, it will be an alternative to Egypt’s Suez Canal in transcontinental freight shipping.

“AD Ports (an Abu Dhabi-based port and logistics operator) has signed a preliminary agreement with the state-owned company managing Iraqi ports to establish a joint venture,” commented the Kazakh freight association.

According to them, AD’s plan, centering on the new port called Grand Faw, is to create a corridor for Asian-European trade, bypassing the Egyptian city of Suez. The Grand Faw Port is set to become one of the largest in the Middle East, with terminals for handling containerized, bulk and liquid cargo. The corridor is expected to be ready by 2038.

In Kazakhstani it is believed that the project is promising, but extremely costly. “We should not forget that all land logistics corridors are more costly than sea corridors. That’s why Kazakhstan has such problems with logistics — it has no access to the sea. Even if the Suez Canal is closed and the Panama Canal shoals [becomes shallow], sea transport will be more profitable. Yes, alternatives are needed. However, I would not count heavily on the new project,” economist Andrei Chebotarev told The Times of Central Asia.

Chebotarev referenced Kazakhstan’s plan to build the North-South transport corridor. A new logistics route alternative to Suez would be a good addition; however, so far the UAE hasn’t included Kazakhstan in its plans.

Due to the recent attacks by Yemen’s Houthi rebels on vessels in the Red Sea, the volume of maritime traffic through the Suez Canal has decreased, which in turn has increased demand for freight transport via multimodal routes.


Times of Central Asia