Despite the tensions in the South Caucasus region, which are related to the Armenian-Azerbaijani conflict and the post-election period in Georgia, it is important to note the positive developments, related to the global importance of the railway project.
General data on Baku-Tbilisi-Akhalkalaki-Kars railway
On December 4 of this year, the first train (consisting of 42 wagons) departed from Istanbul to China, transporting cargo from Turkey to Far East via the Baku-Tbilisi-Akhalkalaki-Kars railway (a total distance 8,693 km. Railway crosses the territory of 5 countries). It is noteworthy that if previously the travel time was at least 18 days, at this stage it took 12 days to transport goods by this railway. Overall, the commissioned railway will connect Europe and China and bring significant revenue to transit countries (including Georgia).
This corridor will facilitate the export of products which will be produced on the territory of Georgia to the world market and will also reduce the price of products exported from Georgia as well as part of the products, to be imported to the Georgian market by railway.
It can be said that this is an unprecedented event, because until today, railway cargo transportation from China to Europe was mainly implementing via Russia. However, a few days ago, an export train to China passed through Georgia for the first time.
In the first phase of the project, about 6.5 million tons of cargo to be transported by this rail will be possible, and it is planned to increase the capacity to 17 million tons in the future.
In addition to the issue of cargo handling within the project, there are significant expectations regarding passenger movement as well. Experts consider that at the initial stage of the railway operation (after solving the coronavirus problem), it is estimated that about 1 million passengers will be transported. For this purpose, the Azerbaijani government already has an agreement with the Swiss company "Stadler" for the production of passenger wagons. In the long run, the number of passengers per year could reach three million people.
It is noteworthy, that the railway corridor will operate in a two-way mode. Consequently, a significant part of the cargo will be concentrated on the territory of Georgia, which is very important in the future not only for the further development of Georgia's transit function, but also for the export of Georgian products to Europe and China. As it is known, a free trade regime was launched between China and Georgia in 2017, as a result of which, according to January-October 2020, China is Georgia's number one export partner. For example, Georgian wine export to the Chinese market is growing rapidly. During the given period, the volume of products, having been exported from Georgia to the Chinese market amounted to 418.9 million USD, while import from China amounted to 572.9 million USD.
It is necessary to note that this railway route has been operating in test mode since 2017. In January-October 2020, the number of containers shipped from China via the middle corridor exceeded the same period in 2019 by 35.1%.
The political and economic importance of the railway
The corridor via Georgia is distinguished not only by its geopolitical, geo-economic and geostrategic location advantages, but also by its developed infrastructure and institutional system. At the same time, the development of the corridor is not just about arranging infrastructure, as it should be accompanied by simplified and digitized customs and border crossing procedures, which in its turn will have a positive impact on Georgia's national interests. The above is accompanied by opportunities for diversification of the supply chain in Georgia, which is reflected in the existence of sea, land and rail links with neighboring countries.
At the present stage, work is already underway on the issues of digitization of transport systems within the country (including ports) and at the same time the transport corridor, which aims to increase the competitiveness of the above-mentioned projects and activities in Georgia.
The commissioning of the future railway will significantly increase Georgia's transit potential. Given the fact that a significant portion of cargo from Europe to Asia and vice versa will pass through Georgia, the geopolitical interest of the world's leading geopolitical players, including China, Japan, as well as EU member states, will increase even more. In particular:
- More countries and companies will be interested in protecting Georgia's strategic facilities and strengthening stability of the country, investing in various sectors of economy of Georgia and ensuring stability on the territory of the country in general;
- In addition, enhancing Georgia's role in the Euro-Asian transport corridor will facilitate the country's further integration into European structures;
- Successful implementation of the project and increase in trade turnover will further strengthen relations between the three strategic partners - Azerbaijan, Georgia and Turkey.
Conclusion
Overall, the above-mentioned railway project is a clear example of how multilateral EU-proposed TRACECA (Europe-Central Asia-Caucasus-Europe Transport Corridor) and Chinese One Belt One Road initiative will be carried out in practice, which will promote the development of cooperation between the participating countries. In addition, the railway will have a significant impact on the process of further integration of Georgia into global processes.
Due to the geopolitical situation, Georgia is distinguished by a very important transport-geographical location. Its territory is not only the axis of the Europe-Caucasus-Asia transport corridor (TRACECA), but also serves as a key function of the shortest transport highway -connecting with each other the Eurasian countries. Therefore, Georgia can make a great contribution to the functioning of the "Great Silk Road", which will be positively reflected on the national interests of the country.
