Go East!
After years of preparation railfreight container volumes between China and Europe are now rising continuously. Geto, which has redefined its role, has called for the rapid and market-oriented consolidation of this success.
The figures alone speak a clear language – railfreight activities between China and Europe via Central Asian have been growing for many years already. The Russian state-owned railway enterprise RZD, which is in the thick of the action with its subsidiaries Far East Land Bridge (Felb) and RZD Logistics, amongst others, recently assessed the bottom line for the first six months of 2017. It reported that RZD hauled 63,200 teu by rail across the Eurasian landbridge, an increase of 1.8% vis-à-vis the previous year. Almost 56,000 teu thereof were transit shipments.
In the first six months of 2017, RZD Logistics processed 30,5 million t of cargo, which exceeds last year’s figure by 5%. RZD Logistics works in the container transit field at all three border points: Dostyk (across Kazakhstan), Zabaykalsk (across Russia) and Naushki (across Mongolia). The routes are thus becoming increasingly differentiated and eastbound trade is gaining market share – even if it has not yet reached the level required.
Fair market conditions – instead of subsidies
The association Geto will continue to focus on promoting the Eurasian landbridge. The body (previously called the Association of European Trans-Siberia Operators and Forwarders), has been renamed. The same acronym now stands for Group of European TransEurasia Operators and Forwarders. The companies that founded the interest group in Basel (Switzerland) in 1978 have drawn a sobering bottom line for the segment, explaining that though the number of railway connections between China and Europe has been rising enormously, this has only been achieved because transport costs are subsidised by the Silk Road Fund. So besides entrepreneurial interest it is the political will, with its financial lubricants, above all, that has kept the wheels rolling.
The operators and forwarders united in Geto want to maintain the routes’ dynamics, and at the same time take steps to safeguard the railway services in the long term. This includes, the association says, “a further reduction in the rates for routes, wagons and containers, in order to be able to retain subsidised price levels in future too.”
Some problems already tackled
Geto’s members also think that “it’s necessary to offer clocked departures with fixed schedules,” but this will naturally require extensive coordination between the various partners in the market, Geto adds. It has called for a further reduction in transit times, the introduction of end-to-end IT structures to speed up handling, and the creation of attractive models for the return of empties; all major challenges, but at least they have already been partially tackled.
In the long term the only sensible solution is a better balance in the flow of goods in each direction; which means an increase in eastbound volumes. The European automobile industry has shown the way, it is true, but more shippers have to follow to make the success story last.
