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Building the Wider Black Sea Area Railway land bridge Providing frameworks for a seamless transport from Far East to Central and Eastern Europe. Railway Days; 8 October Bucharest, Romania Ivan Petrov, Chairman, CLECAT Rail Institute.

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Building the Wider Black Sea Area Railway land bridge Providing frameworks for a seamless transport from Far East to Central and Eastern Europe

Railway Days; 8 October Bucharest, Romania

Ivan Petrov, Chairman, CLECAT Rail Institute


  • Brussels based organisation representing the interest of logistics service providers and freight forwarders

    • National federations and confederations

    • Associate and Related interest representatives

  • 19000 companies: Global players, SMEs and regional operators

  • Business coverage: ≈ 90% of Customs, 70% maritime, 90% air, 50% road and rail operations in Europe – but in general LSP do not own the truck, ship, railwagon, etc…

CLECAT – Who do we represent?


Policy considerations
Policy Considerations

  • EU White Paper 2011 ambition: Revitalisation of Rail Freight

  • Railway’s liberalization realized slower than in other sectors

  • Target: more goods to rail is not reached

  • 2013: rail freight transportation still faces serious problems

  • EU members show stagnation, the level of market share is still below target figures with a 10-year delay.

  • Different degree of development in East-West comparison



Policy considerations 2
Policy Considerations (2)

  • A single European rail market is conditional to increase competition, reduce costs and improve transparency with regards to rail shipments. Full unbundling and interoperability are required to create the necessary level-playing field.

  • Policymakers have to further develop the railway policy in Europe and offer support for the 4thPackage, without delay.


Market considerations
Market Considerations

  • International trade flows have surpassed global GDP growth for decades. Increasing trade across borders is supported by transportation improvementsand increasing ICT, lowering costs and providing transparency.

  • For Europe, growing markets are moving East and/or South, potentially increasing distances and number of countries to cross.

  • The share of rail freight transports in the EU has been decreasing in recent years, but opportunities, in particular on the East-West corridors, are big.


Market considerations evolution of the market in the east
Market considerations: Evolution of the market in the East

  • intense industrial activityin Russia and in Central/Western China

  • risingdomestic consumption/new consumer markets in Russia, in China and in Central Asia

  • increasing direct foreign investments, especially in the eastern side of the WBSA

  • Delocalizationstill in-progress (Russia) and in China (from the coast to Central and West China) - logistics service providers need to follow

  • Exploitation of natural resources (Russia: wood, oil, gas/ Kazakhstan: oil, gas/ Uzbekistan: gas, uranium/ China: ore)

    • boost in trade volumes on the East-West axis, these are the main factors that trigger railway development opportunities


Market for multimodal business between asia and europe
Market for multimodal business between Asia and Europe

  • Huge volume between Asia and Europe 15 million TEU by sea

  • A big potential for multimodal business

    • A lot of existing and developing flows: between Europe and the region of Moscow

    • on corridors from Russia to Central Asia: China, Kazakhstan

  • The competitiveness of the rail in terms of prices and transit time

    • Big interest in rail in the Eurasian market

    • need for multimodal products and partners in this area


Comparing the options 1
Comparing the options (1)

  • Railway Solution

    • Transit time: 3 weeks

    • High frequency of shipments

    • Fewer containers per shipment

    • High level of flexibility

    • Terminals at the border stations

  • Air Freight

    • Transit time: 5-10 days

    • Limited frequency/Flexibility

    • Low weight capacity

    • Very high costs in general

  • Deep Sea Vessel

    • Transit time: 4-6 weeks

    • Slow/super slow steaming

    • Unstable rates


Comparing the options 2
Comparing the options (2)

Price:

  • rail costs 20-30% more than sea

    Transit time:

  • rail is about 30 days faster than sea transport

    Trends in prices:

  • In short-term: increasing prices for sea transport, closing the gap between sea and rail prices

  • Additional huge capacity in sea container vessels will force down freight rates in maritime transport - rail will face new challenges in direct competition

  • In the long-term: sea and rail transport prices will be closer again partly due to higher energy prices and additional costs

    Trends in transit times:

  • In shortening transit times for rail due to infrastructure, technological developments and further enhanced cooperation

    Result: relative competitiveness of rail will improve


Basic rules for the competitive rail option
Basic rules for the Competitive Rail Option

  • Price: Competitive pricing, based on market prices

  • Time: Time as key differentiation of rail to sea

  • Reliability

  • Flexibility and frequency

  • Quality: SLA’s

  • A total integration in the supply chain

  • Identify return flows: to reduce empty loads


Interoperability is key
Interoperability is key!

  • Further development of ports and hinterland connections for railway transportwill allow for increase in cargo volumes in the WBSA region.

  • All intra-European corridors, those linking Europe to Asia and Middle East, need improvement, because they boost interoperability. But also need for real interoperability between continents and modes:

    • need for provision of information several times for different purposes

    • lack of information on multimodal availabilities

    • lack of integration of information from tracking and tracing technologies and intelligent cargo applications

  • harmonisationof technical and administrative rules both in Europe and Asia which will facilitate and ease cross-border operations


Challenges along the rail corridors
Challenges along the Rail Corridors

  • Customs

  • Identification of return flows

    • Imbalance in trade flow: 55% westbound, 45% eastbound – economic interests in strengthening exports

  • CIM/SMGS single consignment note

  • Lack of e-Documents

  • Lack of real Single Windows in support of:

    • faster release of goods

    • predictable and efficient description and implementation of rules

    • more transparency


Multimodal challenges

Complexity of freight transport information exchange in an multimodal transport context:

  • lack of interoperability along the supply chain

  • inefficiencies, costs, reduced visibility of freight, perceived complexity for multimodal transport, sub-exploitation of multimodal transport, non-optimized use of existing transport infrastructure, etc.

Multimodal Challenges



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