• 2017 January 16

    DNIIMF: The corridors lack macroeconomic prospects

    Experts say the format of international transport corridors Primorye-1 and Primorye-2 with forecasted annual traffic of 60 mln t and required investments of RUB 180 bln is out of date. In his interview with IAA PortNews, Mikhail Kholosha, Head of DNIIMF Transport Development Department,  tells about the need to revise the model of transport potential development in the region.

    - Mr Kholosha, Aleksandr Galushka, Minister for the Development of the Russian Far East, said in late 2016 that RF Government had approved the concept of international transport corridors in Primorye ... What do you think about the significance of this decision?  

    For me it is a vital sign of acknowledgement on the federal level of Primorsk territory’s transit potential, for the first time over several decades. However, the backbone of the idea is not only in transit development but also in creation of a state-of-the-art transport system to ensure comprehensive economic development.  

    - Why is it necessary to revise the existing approaches to development of the regional transport system? Why is it important today? 

    - Because without clear understanding of macroeconomic trends in the North-East Asia (NEA) and without efforts to develop a plan for the development of regional economy in view of those factors we risk missing the opportunity of implementing vital projects, first of all those, basing on international transport links. It is urgent amid the growing strategic and economic activities of our neighbors whose interests are historically linked with the development of the regional transport system.    

    The second half of 2016 in NEA countries was marked by stirring up of international cooperation in the field of transport development. DNIIMF  JSC knows the situation from inside as an expert organisation participating in forums and consultations. In late autumn our experts took part in two large forums in the Republic of Korea: international round-table meeting Eurasia Transport & Logistics Partnerships arranged by the Korean Transport Institute (KOTI) and in international seminar on the Northern Sea Route arranged by the Korea Ports & Harbours Association with the participation of representatives of the South Korea’s National Assembly. Then Changchun hosted the symposium on maritime economic cooperation between China and Russia arranged by the Tumangan Association for International Cooperation of the Jilin province. Later on, national coordinators of the Greater Tumen Initiative and EXIM-banks of NEA held meetings. On 30 November, Vladivostok hosted a three-party meeting on logistic cooperation in the Far East of Russia. Among the event participants were representatives of the authorities, business and science communities of Russia, Republic of Korea and China. At the same time we held a number of meetings with the experts from Japanese institutions. Finally, on 14 December, DNIIMF together with Korea Eximbank and KOTI held the 2nd Northeast Asia Infrastructure Forum dedicated to interaction between the development institutions. The purpose of the event was to support the practical Russia-Korea cooperation focused on the development of conditions for harmonious development of transport infrastructure, improvement of all types of transport and generation of new ideas in transport and logistics sphere and in the economy as a whole.

    - What is the point of those events? How are these activities correlated with the state initiatives on the development of eastern territories? 

    - Our neighbors in the region, as before, are extremely interested in cooperation with the Primorye when it comes to the development of international transport system. However, over the last two-three years their approaches have changed in many aspects while Russian plans on transport development  have seen no improvements. NEA countries have come to understanding that the region needs not separate corridors but a transport and logistic network. It is an external demand and it obviously matches the internal one. 

    When speaking about the development of transport as an infrastructure it is always about spatial development taking into consideration national and international strategic aspects rather than about a package of local projects.
    As of today, it is necessary to ensure macroeconomic correlation of separate projects under a common logic of movement towards a general success. Separate projects should be correlated with the vectors of free port economic development including the development of infrastructure that would meet the demand of today. 

    - How does the project of international transport corridors in Primorye relate to transport programmes of our neighbors?  

    - NEA countries have been going to develop international transport corridors for a long time. There was a demand for that very model of cooperation. It was within the framework of existing political and economic possibilities. The issue of international transport corridors was quite promising and used to reflect the spirit of time, the region and the country we lived in. We were to blend into that demand, into those possibilities. Today, amid the development of technological, political and economic aspects, considering all the development initiatives, the situation with our eastern territories has changed enough, so that we should come up with ideas reflecting the current situation. To a certain extent, the corridors is an outdated idea; they are needed but in their new capacity. They should be improved and that improvement relates to macroeconomic level. 

    Today, we see that the authorities of our neighboring countries (first of all, China, Republic of Korea, Japan etc.) associate the development of their countries with cooperation with Russia, with possibilities of our economic development through Seamless Transport & Logistics Network covering numerous routes. It is very important for us to correlate this network with local projects of Russia’s Far East.

    So far, no network is being created in the south of Primorye with the development of separate corridors. These are two different routes. They should be integrated into a single transport system, then we will be I demand and will be able to manage logistics, cargo flows and our own development … 

    A network provides an opportunity of optimization in logistics and macroeconomics and contributes to investment attractiveness of our territories, specific projects, operational attractiveness of the ports because the ports within a network are more powerful and more effective as compared with the ports at the ends of corridors. 

    This macroeconomic approach allows for expansion of the strategic horizons while creation of a single network strengthens the base for further mutually beneficial cooperation and reinforcement of all its positive aspects. This is not about the reduction of diverse risks but also about harmonious, sustainable, safe and reliable development in general.

    I would add that the necessity of establishing a transport and logistics network was emphasized at all the mentioned forums including the international round-table meeting on transport (Jeju island, Republic of Korea) attended by representatives of Korea, Japan, Russia, World Bank and Asian Development Bank, ESCAP and other outstanding experts in the field of transport. Similar ideas were brought up at the transport conference in Seoul. The significance of the matter was emphasized by its venue – the Parliament of the South Korea. They discussed the creation of single transport and logistics network both in the framework of Eurasia with all its routes including the Northern Sea Route and in the regional framework of NEA and more local framework – territories and ports along the Sea of Japan. 

    The meeting in Changchun held in November also showed that our Chinese partners are interested in further improvement of the existing plans on the development of cross-border transport network. The parties have agreed to look for effective and mutually beneficial ways of transport infrastructure development.

    The events under GTI held in Vladivostok have shown that multilateral cooperation is the key format for creation of a single infrastructure covering several countries. The agenda included the issues related to grain terminal at port Zarubino and the proposal of Russia to strengthen the practical mechanism of project support, allowing for improvement of both separate projects and their interaction. This can be ensured by GTI Project Office.

    Three-party meeting on cooperation in logistics held in Vladivostok covered a wide range of practical issues like improvement of infrastructure, possibility of reducing transit terms etc. Of course, to a great extent such issues are handled locally through improvement of the existing procedures but in many respects they require an approach allowing for changing the market as a whole. It is a spatial approach that will let create a network. 

    Participants of the 2nd International Forum in Vladivostok have discussed a wide range of cooperation issues and noted that there are many promising ideas and areas of mutually beneficial cooperation in the sphere of economy and transport. They can succeed in NEA with involvement of other countries in the region.

    Thus, macroeconomic approach to the development of the region with participation of Russia is in demand at all our neighboring countries. The signal is so strong that it would be a mistake not to reconsider the situation with the plans on corridors development. The focus on two separate transport corridors requires improvement. We should be integrated with the transport and logistics network developed in the NEA region that will let service the economy of that region and obtain new opportunities for our own development. This requires logistic infrastructure of the Free Port of Vladivostok effectively integrated with that of our neighbors and consolidating the existing and new projects allowing for efficient optimization of logistics and being a macroeconomic instrument of development. It is a task of developing a state-of-the-art transport and logistics market.

    Intreviewed by Yevgeny Pankratyev