World News – May 2019
NUR-SULTAN – Kazakhstan’s First President Nursultan Nazarbayev briefed the April 25-27 Belt and Road Forum for International Cooperation in Beijing on the country’s infrastructure development and transport potential.
“Over the past ten years, Kazakhstan has invested about $30 billion on infrastructure development, transport and logistics assets and competence. Almost 3,000 kilometres of national railways and 12,500 kilometres of highways have been modernised or put into operation. Domestic sea and air harbours were reconstructed. As a result, the country has turned into a modern and competitive transit hub,” he said.
The Western Europe – Western China intercontinental highway now connects Europe and China through Russia and Kazakhstan, noted Nazarbayev, adding the highway was completed through cooperation between the country’s Nurly Zhol Programme and the Silk Road Economic Belt.
Nazarbayev also said China’s Belt and Road Initiative is in line with his own G-Global Initiative to address global economic challenges.
Nazarbayev praised the Belt and Road Initiative, saying it has succeeded where other efforts to revive the Silk Road over the last 30 years have failed.
“In a short period of time, together we have built economic corridors which avoided complex natural landscapes and geopolitical contradictions,” Nazarbayev said noting trade within the initiative has reached $5 trillion.
Nazarbayev said the initiative proposed by Chinese President Xi Jinping in Nur-Sultan (then called Astana) in 2013 has become a successful model for development despite current international political contradictions, sanctions and trade wars.
“It is clear that the world is already tired of conflicting geopolitical concepts and strive for geo-economics and joint development. The Belt and Road displays much more than a complex of new opportunities for economic cooperation. The initiative reflects a strong historical demand for security, trade and prosperity of more than 120 countries,” Nazarbayev said noting Kazakhstan has supported the initiative from its inception.
The former Kazakh President also congratulated the Chinese people during the forum on the 70th anniversary of the People’s Republic of China.
The biggest challenge for a new terminal at Georgia’s Port of Poti will be ensuring there are feasible transport routes for delivering goods to key markets including central Asia, a finance expert has said.
Although the Port of Poti is the main port for Georgia and offers the quickest route to the Caucasus region and central Asia, PACE Group’s terminal project will need to negotiate cargo through several countries before it reaches its destination country, stated Kenneth Angell, managing director for project finance in small and medium-sized enterprise finance at the US-based Overseas Private Investment Corporation (OPIC) and team leader for the PACE Terminal Project.
Speaking exclusively to Port Strategy, Mr Angell said: “One critical and important challenge will be to be able to get the goods to different countries, say in central Asia. You may have to go through another country to reach Uzbekistan, for example.
“You’ve got to have the co-ordination of road, rail, as well as customs. That’s being discussed but it’s not a smooth flow and I think that that will be a challenge to move goods to those areas.”
PACE Group handle 97% of the bulk that goes through APM Terminals-owned Port of Poti and having purchased old property with a shipyard adjacent to the port, PACE is converting it to accommodate bulk and some limited container trade and will undertake dredging to ensure it can handle vessels up to 50,000 tons.
Approved in December and committed in January, the terminal project’s loan agreement of $50m is in the process of being negotiated and is the largest loan OPIC has made to a single project in Georgia.
Construction for the project is expected to take two years and Mr Angell said there is certainly a case for development as more traffic wants to use Poti. “No other port around the Black Sea is able to match what Poti is able to do on distance,” Mr Angell said.
He said issues including congestion at Russian ports and Georgia’s ban on wheat transport by trucks from Russia requiring transport by rail or ferry ensures the terminal will be in demand, alongside strong cargo growth for the geographies it will serve. However, container traffic development could be a challenge for the terminal.
All OPIC projects require a minimum of 25% US involvement and the organisation looks for strong, viable projects that generates cash flow and offer development benefits. OPIC, which follows the International Finance Corporation guidelines for ports, assesses project, sector and country risks, plus which of these should be borne by the shareholders and which ones should be borne by the investors.
Digital Container Shipping Association (DCSA) welcomes five new members, one month after its establishment.
CMA CGM, Evergreen Line, Hyundai Merchant Marine, Yang Ming and ZIM are joining the new association in order to support the digital standardization in the box shipping industry.
According to a statement, CMA CGM confirms being a founding member of DCSA and hence, being part of the Supervisory Board. Evergreen, HMM, Yang Ming and ZIM enter into DCSA as members.
With the last addition of the five mega carriers, DCSA represent a major part of the industry. COSCO is the only Top 10 container shipping company which has not yet joined the digital union.
Thomas Bagge, CEO of DCSA, commented:
“We are thrilled to have additional members joining the DCSA on our journey to drive standardisation and interoperability in the industry, with CMA CGM joining as a founding member. It is critical for our success that the standards developed will be implemented, and the commitment and engagement of many container shipping lines is therefore crucial.”
DCSA, also, announced the appointment of Henning Schleyerbach as COO, as of July. He comes from a position as Senior Director Customer Relationship Management at Hapag-Lloyd.
Andre Simha, Chairman of the Supervisory Board commented:
“We are pleased to announce that in Henning Schleyerbach we have win another strong industry profile, who as COO will drive DCSA’s operational activities. With Henning Schleyerbach and Thomas Bagge, DCSA has a strong leadership team in place which is supported by all founding members and represents container shipping at its best across all aspects.”