AZERBAIJAN: TAPPING TRANSIT POTENTIAL BAKU BUILDS BIG

The Port of Baku is on an expansion path with capturing new transit cargo flows at the heart of this. Oleksandr Gavrylyuk identifies the drivers and details the plans

Moscow’s brutal war in Ukraine and its growing international isolation have led many global traders and logistics operators to bypass Russia and look for alternative ways of transporting cargoes between Europe and Asia.

In this context, Azerbaijan, a South-Caucasian nation located at the crossroads of longitudinal and latitudinal transport routes, seems to be determined to get the most out of its position on the world map.

In January this year, when speaking at the World Economic Forum in Davos, Azerbaijan’s President, Ilham Aliyev, unveiled his country’s plans to almost double the annual capacity of its principal Caspian sea-gate, the Baku International Sea Trade Port (Port of Baku). The intention is to raise annual capacity from the present level of 15mt/yr to 25mt/yr over the near term.

The Port of Baku is instrumental in handling the evergrowing trans-Caucasian cargo traffic, being an integral part of the Trans-Caspian International Transport Route (TITR or the Middle Corridor).

Under the current circumstances, the further development of the port’s infrastructure and the planned expansion of its capacities are expected to substantially contribute to intensifying the Trans-Caspian freight flows.

Albayrak Group Invests

Last year, Baku agreed with Turkey’s Albayrak Group (AG) to jointly develop the harbour’s handling facilities. Under the deal, the Turkish company will run the Port of Baku’s ro-ro terminal. In addition, AG will take part in the construction of a new facility for handling 2.5 million tonnes of fertilisers a year. It will have a 49 per cent interest in the fertiliser terminal.

Turkish business circles are very interested in increasing the volume of cargoes transported between Europe, Turkey and Central Asia via Azerbaijan, according to Harun Oncu, Director of Logistics, Albayrak Group.

The Central Asian countries of Kazakhstan, Uzbekistan and Turkmenistan are large exporters of mineral fertilisers with an immense production potential estimated at around 10 million tonnes a year. To reach international (specificallyEuropean) markets, their fertiliser exports need to cross the Caspian Sea and the Caucasus, thereby designating the Port of Baku as a key element in the associated logistics chain.

Reportedly, Azerbaijan has already come to agreement with the Central Asian states over the would-be handling of their fertiliser exports through the Baku harbour.

Also on the agenda for the Port of Baku is the construction of a grain terminal to ensure the country’s food security, according to Taleh Ziyadov, Director General, Port of Baku. This is another project expected to be undertaken in the short term. Over the medium to longer term further development plans forsee the construction of a dedicated container terminal, which would expand the harbour’s container handling capacity from 100,000 to 500,000 TEU, and a multimodal logistics terminal.

As the old harbour in downtown Baku had exhausted its expansion potential, in November 2010, Azerbaijan started erection of new port facilities on a 400ha land plot at the town of Alat, some 65km south of the capital Coty.

In September 2014, Alat saw the launch of a new ferry terminal linking it with Turkmenistan and Kazakhstan. In March 2016, a special (free trade) economic zone was set up at the new harbour. In January 2018, a new ro-ro terminal was put into operation. Development has been progressive.

Last year, the Port of Baku handled more than 6.3 million tonnes of cargo, up 14 per cent on 2021. In terms of container handling, the harbour operator increased its 2021 volume by 16 per cent to 52,276TEU. In the ro-ro sector, Baku expanded the volume of handled trucks (TIR) by 31 per cent over the previous year to 51,514 and passenger car traffic trebled in 2022. Remarkably, transit cargoes made up about 90 per cent of all cargo volume handled at the port last year.

Transit Potential

In addition to the port expansion, the Azerbaijani government is, according to President Aliyev, prepared to increase its investment in the development of the Baku-Tbilisi-Kars (BTK) railway, one of the TITR’s main arteries connecting the TransEuropean and Trans-Asian rail networks

“There is a strong global demand for the transport routes via the Caspian Sea, Azerbaijan, Georgia and neighbouring countries,” he stressed pointing out that the cargo traffic only between Baku and Tbilisi grew by 75 per cent in 2022 over 2021..

Launched in late 2017, the 826 km-long BTK has unified the railway networks of Azerbaijan, Georgia and Turkey into a single transport corridor. With an initial annual capacity of 6.5mt/yr, it is planned to to increase this over time to 17mt/yr.

Last year, Azerbaijan, Georgia, Kazakhstan and Turkey signed a joint declaration expressing their readiness to carry out common transport initiatives, including both the Middle Corridor and BTK.

The same year, Azerbaijan, Iran and Russia inked the Baku Declaration on the further development of the International North-South Transport Corridor. Specifically, it is planned to transport up to 30 million tonnes of transit and bilateral cargoes between the three countries by 2030.

Situated at the intersection of the modern Silk Road and the North-South transport routes, Azerbaijan is ready to fully tap its transit potential.

8 The phased expansion of container handling capacity is on the agenda at the port of Baku along with plans in other cargo sectors to significantly raise capacity

13 15 TO JUNE 202 Southampton United Kingdom

Marine Civils is co-located with Seawork

Marine Civils in association with Seawork, Europe’s leading commercial marine event. Dedicated to showcasing the latest equipment and solutions for marine, coastal and other challenging civil engineering projects with unique landscape features.

Reach a larger audience than ever before

Reserve now for 2023 and make the most of year round marketing support from Marine Civils, Seawork and our leading commercial marine

Marine Civils attracts representatives from:

• Civil engineering

• UK port authorities

• Energy companies

• Conservation organisations, amongst others

With a big overlap in content and business for companies involved in marine construction, the event is uniquely positioned to provide invaluable opportunities to access wider relevant audiences via Seawork and Maritime Journal.

Supporters

For more information visit: seawork.com contact: +44 1329 825335 or email: info@seawork.com

Media partners: