Diplomatic Herald 1 (50) 2015 by MFAKAZAKHSTAN

DIPLOMATIC HERALD 1 (50) 2015

The topic of the issue:

Ð¢ransport diplomacy

President of the Republic of Kazakhstan Nursultan Nazarbayev: " Our country, located in the heart of Eurasia and having a great transit potential, more than anyone else feels the need for cooperation in the transport sector and is ready for a broad partnership in this area."

EDITORIAL

Dear Reader! You hold the anniversary – 50th issue of the Diplomatic Herald, which we decided to devote to transport. Why? The answer is simple. States and peoples are connected by caravan or other roads, and travellers are represented by all professions, including traders and adventurers, intelligence officers and missionaries, ambassadors and military personnel. Roads and rivers, transport routes in general require building bridges, ensuring mutual understanding, and developing cooperation, that is, at the end of the day, an inalienable task of every diplomat. Thus today, at the beginning of the third millennium, we witness the restoration of the Great Silk Way dictated by our times, launch of grand international corridors, and the formula – progress and prosperity of any state is impossible without the development of infrastructure, has become an axiom. The above fully applies to the world’s ninth

largest state – the Republic of Kazakhstan. Historically, transport flows from the East to the West, from the South to the North and back have gone through the territory of our county, and in the globalization era their intensity is only increasing. While identifying priorities of the young independent state, its wise leader set a strategically important task that is to make effectively use of the existing transport and transit potential, to develop comprehensively trade flows through the country of the Great Steppe. Obviously, the topic of this issue is difficult to cover fully in one publication. We just want to slightly open the door to present the “Caravan of opinions” expressed by our esteemed authors on the Diplomatic Herald pages Of course, we will return to it in the future. I hope that your feedbacks, ideas, questions, and information will help us to do so. Let’s start our journey.

CONTENTS

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Dauren ABAEV, Output from the transport trap

Adil AKHMETOV, “Silk Road” in the era of geopolitical changes

Askar MAMIN, Nurly Zhol connects continents

Karl BAIPAKOV, The Great Silk Way – a dialogue of cultures

Kairat LAMA SHARIF, New Silk Road, from Kazakhstan to UAE

Nurlan ADILKHANULY, “Khorgos - Eastern Gate” will make Kazakhstan a leading transit country of the region

Sanzhar ELYUBAYEV, KTZ Express: From a dry port to a sea port - an entire country in between

Kulpash KONYROVA, Astana and Tallinn: prospects of transit potential

Magtymguly AKMURADOV, Kazakhstan and Turkmenistan increase cargo transit after the opening of the Uzen-Bereket line

Foreign diplomats assessed the prospects FEZ “Khorgos-Eastern Gate” Aiman TUREBEKOVA, Astana begins direct flights to Paris

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Output from the transport trap Dauren ABAEV, Counsellor – Press-Secretary of the President of the Republic of Kazakhstan

The commissioning of two railways this year Zhezkazgan - Beineu and Arkalyk - Shubarkol and the launch of the mainline of Kazakhstan - Turkmenistan - Iran draws a line under the key stage of the transport strategy of our country. Thanks to this Kazakhstan was able to take a unique niche in the global market of space and time. “Trapped on land” In the world there are 48 countries without access to the sea. They are cut off from opportunities of maritime trade, which accounts for the lion’s share of world trade - about 90%. International merchant fleet, comprising more than 50 thousand ships, is forming what we call the global market. Influential British economist Paul Collier in his book “The Bottom Billion” defined the absence of access to sea one of the main “traps” that stop the development of nations condemned them to stagnation. 40% of the “bottom billion” live in the “land locked” countries - the poorest group of mankind, so-called, as opposed to the “golden billion”. Exceptions of this rule are very, very few. One of these becomes Kazakhstan - the largest country in the

world without access to the sea, on the territory of which there is “pole of remoteness from the world’s oceans.” In the modern history of the world there are practically no precedents of such an impressive overcome of a “transport trap.” Kazakhstan proved by its example that the lack of direct access to the sea - not a sentence. Now or never Since independence our country was in stalemate. Transport system inherited by Kazakhstan not only provided access to external markets, but not even allowed to form a single internal market. In all kinds of communication there was not a single network as such. This is not surprising, since the fragmentation of transport routes only reflected the fragmentation of the economy. It was expected not just to build new roads and pipelines, ports and power lines. It was necessary to create a new coordinate system. It should be noted that the problem of permanent investments in transport is relevant for all countries. According to the International Energy Agency, until 2050, the global infrastructure will require an investment of 45 trillion. dollars.

Meanwhile Kazakhstan in the 90s lacked money even for urgent needs. The country was at a strategic crossroads: either to postpone investment in infrastructure to better times, or in spite of all costs, yet move forward. The political will of Nursultan Nazarbayev played a decisive role then. The Head of State was able to look beyond the current economic upheavals and “see the sea out of the waves”. In September 1999 he explained in the Address to the Nation of opting for the infrastructure: “The history of Central Asia in the second millennium showed that the nations, which are in the center of the continent and do not have access to global communications, have no future. The fate of all the peoples of Central Asia, if you remove details, depends on the main thing: we will be able to become a transport channel of global significance or again find ourselves on the sidelines. Transport infrastructure was identified by priority area, on which the future of the country depends. At the same time outlines of strategic projects were built. But most importantly - the President succeeded in implementing them. While many countries, having sought a way out of the “transportation trap”, were stuck at this stage.

Firstly, opportunities of the Caspian Sea are used to the maximum. Modernization of Aktau port transformed it into a major transport hub, through which nearly a third of turnover in the Caspian Sea is made. Secondly, Kazakhstan entrenched in the ports of other countries through which flow of domestic goods grew. Now among foreign port assets are: Baku Grain Terminal, the Black Sea port of Batumi, a grain terminal in the Baltic port of Ventspils, the KazakhChinese terminal in the Pacific port of Lianyungang. As a result of this “descent” Kazakhstan cut off from the sea managed to build port infrastructure, diversified in all directions. Thirdly, even in the most difficult times for economy scale investments were sent for the development of all types of continental communications. In the pipeline area new transport corridors were created in the direction of Kazakhstan - China to export oil and gas to one of the largest markets in the world. In addition, there is the CPC oil pipeline, which has become the main route of delivery of oil from the Caspian region. No less active construction was carried out in the road sector. The largest transit project of global significance here is 2700-kilometer-long section of the

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Kazakh auto corridor Western China - Western Europe. The real boom - in regional and even global scale - was experienced by the construction of railways. During the years of independence, 2,500 km has been built in Kazakhstan. The section of the international line Kazakhstan - Turkmenistan - Iran, the highway Zhetygen - Korgas, having accelerated the delivery of goods between China and Europe, were laid. New roads Zhezkazgan - Beineu, Arkalyk - Shubarkol, Aksu - Delegen, Khromtau - Altynsarin, Shar - UstKamenogorsk directly interconnected northern, central, western and eastern regions of the country, reducing the distance for hundreds of kilometers. The capacity of a key transit area Aktogay - Dostyk. Unprecedented construction of railroads gave birth to an entirely new industry for the country - Railway Engineering and breathed life into the vast territories. Thus, a strategic task was solved in the shortest possible time - to turn Kazakhstan into the Eurasian transport hub, by making a crossroad out of the deadlock. Vehicles did’nt become “bottleneck” for economic development. On the contrary, it turned out to be one of its most effective incentives, creating a strong demand for goods and services, labor. All roads lead to Kazakhstan There is another result of the transport strategy pursued by President Nazarbayev. What is the global transport infrastructure? According to the OECD definition, it includes international maritime trade and transport routes, major ports-gateways and connecting them overland

transport corridors, as well as continental strongholds. Kazakhstan, in fact, was out of this infrastructure - “on the sidelines”. But if we impose all projects realized in recent years on strategic transport map of the world, we’ll see a clear picture. Firstly, the access to seaports on the east and west has been obtained. Secondly, there are own strongholds in the country. Thirdly, two international continental transport corridors have been lined up. Thus formed there are all links of implementation of the task to include Kazakhstan in the global transport infrastructure. This is the case, when “the mountain came to Magomed”. Having timely entered into a large transport game, Kazakhstan has managed to build a foundation for the development as a global transit power. And it can be called a decisive economic achievement of our country at this stage. In addition, all the prerequisites have been created in order to avoid the “middle income trap”. Economists have estimated that the states reached GDP of 16 thousand dollars per capita, stuck in this range. Kazakhstan is projected to come to this indicator in 2016. But infrastructure space created and the rapid development of transport engineering imply that “Problem-2016” will be successfully resolved. We can say without any exaggeration that the historical choice of the transport strategy made by Nursultan Nazarbayev, has paved the way for us to the future. This path has already received new and even more ambitious targets, such as the project “Nurly Zhol”. After all, success - not a destination, but a road. And Kazakhstan is steadily moving along it.

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Adil AKHMETOV, elder of Kazakhstan

“Silk Road” in the era of geopolitical changes To date, the weakening of the economic power and role of the united Europe and America in the global geopolitics coincides with the strengthening of the Eurasian integration and rapid economic development of China. These processes, in turn, clearly show the formation of a new geopolitical map of the world and the transition of world order from West to East. No reason not to consider to be a natural phenomenon of a return to the historical arena of the “Great Silk Road” that connected from the ancient times Asia and Europe, exactly in this period of geopolitical change. In addition, in the present age, full of mega changes, the real truth is that the main priorities of social life are characterized by primarily geopolitical and geo-economic interests. Apparently, therefore, no matter what age it is, the more intense the world trade and economic relations, the better, in accordance with the requirements of the time, the cultural and humanitarian and related to public safety relations and interests, and this is the objective law. Consequently, the implementation of the idea of “New Silk Road”, pursuing exactly the same diverse goals and objectives, in the interests of not only the countries of Asia and Europe, along the road, but also other states, having established permanent trade relations with these countries. “New Silk Road”, preparing to spread its wings, is not the old path of trading caravans, which has begun to lose traces of past years. On the contrary, the

purpose of this global project - strengthening economic priority, the formation of transit transport systems and logistics hubs chains extending over 5000 kilometers and equipped with modern advanced technology. This objective based on the cluster approach also covers, passing through the territory of the five regions of the country, covering thousands of kilometers, a transport corridor Western Europe - Western China, the construction of which is nearing completion. Of course, the United States also attempted to recreate the “New Silk Road”. However, having begun in this country in 2008 and later affecting Europe, then the whole world, the economic crisis, the effects of the recession, which led to the destruction of the financial and banking systems, and domestic debt of the country, exceeding 17 trillion dollars, have been in path towards the realization of the American project, have not allowed carrying out their global interest and have led to the decline. Instead, based on economic pragmatism and a thoroughly thought-out project “New Silk Road” of a rapidly developing China snatched the top prize. This is for objective reasons. For example, if you look into the depths of history, first, we know that “The Great Silk Road” at one time connected the East and West even in the second century BC the first sent caravans laden with silk from the ancient capital of China - Changan

to Central Asia and other regions of the world. Second, today’s “New Silk Road” re-designed to be a bridge between East and West and well-planned by China is not limited to land routes through the continents of Asia and Europe. This project also includes the ocean and sea routes. This topic has been fully disclosed during the presentation of the media trip “The New Silk Road - A New Dream”, organized by the official news agency of China “Xinhua” in May of this year. A color map of the “New Silk Road”, attached to a bright, catchy heading “How can the world win? China will answer this question” has immediately attracted the attention of the whole world. Because in this map, along with numerous routes for future economic belt of the Silk Road of China, including the international corridors, connecting not only Asia and Europe, but also Africa, trails and waterways are clearly visible, starting with the South China Sea and passing along the southern edge of Asia, connecting with Western Europe. Most importantly, each of them starts in China and is connected with each other in Europe, or conversely, begins in Europe and is connected in the Chinese land. Third, all of the above suggests that the modern Chinese state among the economic priorities attaches particular importance to the development of logistics centers and transit transport systems. Fourth, the results of economic policy, which China

attaches great importance, haven’t remained without attention of the world community. They are quite obvious. For example, in July 2011, this state launched 11,000 kilometer intercontinental railroad that connected its western regions to Europe via the territory of Xinjiang Uygur Autonomous Region, Kazakhstan, Belarus, Poland and Germany. Then, some time later, in November 2013, the first container train was sent from Shaanxi Province to the Central Asia. Consequently, de facto we can already say that the project of China “New Silk Road” has began to be implemented and, most importantly, the transit potential of our country in this project is of utmost importance. Because Kazakhstan is also making a big contribution to the implementation of the “New Silk Road”. For example, this year, during the official visit to China the President Nursultan Nazarbayev has taken part in the launching ceremony of the construction of the marine terminal, which will allow our country to get out in the Pacific through the Chinese port of Lianyungang. In turn, it is expected that the terminal will give a great impetus to the development of special economic zone “Khorgos - East Gate” During this visit the Head of the state has spoken at the regular summit of the Conference on Interaction and Confidence Building Measures in Asia (CICA) held in Shanghai and as the author - initiator of this Summit,

ready to become an international organization, has put forward a bold proposal to place the headquarter of the “New Silk Road” in the city of Almaty. For our country is very interested in developing its transport infrastructure and plans to invest USD 45 billion in this sector till 2020. There is no doubt that such expenses are self-supporting, because until 2020 the potential of transportation in our country will be doubled, and it is expected that the profit from this will increase three-fold. In addition, the National Company “Kazakhstan Temir Zholy” before the end of this year plans to complete the 1200-kilometer railway connecting Zheskazgan and Beyneu. This corridor also aims to connect the port of Aktau on the Caspian Sea and China through the Caucasus. In addition, “Aktau sea port”, referring to the special economic zone, is being expanded and a logistics center is being commissioned in Aktobe. However, it should be noted that in recent years the considerable progress has been made in the railway engineering. Presidential Address to the Nation, made in January of this year, has noted that one of the ambitious projects in the field of high value added of domestic raw materials and infrastructure is completing next year the construction of the Kazakh section of the international road corridor Western Europe - Western China and that it is an integral part of the “New Silk Road”. At the same time, the President has also attached special importance to the issue of revival of the historical role

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of the corridor as a link of Asia and Europe and its transformation in the near future into a logistics and transit hub in the Central Asia. In this regard, the Head of the state has expressed confidence that the volume of traffic through the corridor, as has been noted above, by 2020, will double and in the future will reach 50 million tons. According to the calculations of the Union of International Road Carriers of the Republic of Kazakhstan, with the start-up of the transport corridor “Western Europe - Western China” the number of flights operated by Kazakh carriers in 14 countries of Europe and Asia will increase from 15 thousand to 100 thousand annually, and respectively, there is no doubt that the profits from will increase by several times. It is necessary to take into account the fact that a significant part of the transport corridor linking Western China and Western Europe passes through the territory of Russia, and the impact of the new project will directly depend on the level of development of the transport infrastructure of the neighboring state. Russia is also very interested in developing its transport infrastructure, therefore making every effort and contributes to the speedy implementation of the project “New Silk Road”. Creation of transport and logistics and business infrastructure is vital not only for Kazakhstan, but also for foreign partners of our country. Therefore, within the framework of the Intergovernmental Commission TRACECA (Transport Corridor Europe-Caucasus-Asia) Customs Committee of Kazakhstan jointly with the Secretariat of TRACECA, the Ministry of Transport

and Communications and the National Company “Kazakhstan Temir Zholy” discussed and agreed in advance a plan of action to increase the transport and transit turnover passing through the Caspian Sea and South Caucasus linking China with Southern Europe and the Middle East. However, the success of the transit corridor TRACECA will be directly linked to the railway line Zheskazgan-Beyneu, the construction of which is nearing completion and that will give a powerful impetus to the development of the regions of Kazakhstan. From this point of view, the development of transit potential of the country - a problem not only of government bodies. Firstly, there is no doubt that the issue can be resolved through direct investments both from abroad and inside the country. Secondly, one of the priorities on the agenda of the country, is the increase of the economic efficiency of customs offices by increasing transit capacity, the active introduction of modern technologies, bringing their activities into compliance with international standards. Third, the Mausoleum of Khoja Ahmed Yassavi, petroglyphs of the Archaeological Landscape Tamgaly,

Sary-Arka - steppe and lakes of Northern Kazakhstan, Korgalzhyn and Naurzum natural reserves, included in the UNESCO World Heritage List, the settlements Kayalyk, Karamergen Talgar, Aktobe, Stepninskoe, Akyrtas, Kulan, Kostobe, Ornek, recently included in the list and other objects of historical and cultural heritage, to be included in this list in the near future, no doubt contribute immeasurably to the attractiveness of the branches of the “New Silk Road” passing through the territory of our country. Irrefutable proof of this statement was published in the First Interregional Meeting of National Commissions for UNESCO held in Astana on July 22-24 of this year with the participation of 120 countries. Consequently, the New Silk Road passing through the territory of Kazakhstan will not only improve the transport-transit and logistics potential of the country, but also will give a powerful impetus to the development of the tourism sector, strengthening the economy of the country. To reviving and passing through the territory of our country “The Great Silk Road” we wish further success and prosperity!

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Askar MAMIN, chairman of Kazlogistics Transport workers’ Union, president of Temir Zholy NC

“Nurly Zhol connects continents”

Ahead of transport workers professional holiday, chairman of Kazlogistics Transport workers’ Union, president of Temir Zholy NC Askar Mamin gave an interview to KP on transport industry development. – Nursultan Nazarbayev called transport infrastructure the blood circulatory system of our industrial economy and society. The drop in demand and prices on world markets has a negative impact on our economy. How does it tell on the transport sector in general and on Kazakhstan Temir Zholy? How does the company plan to cope with global challenges? – The transport sector provides services to the domestic and international trade and as a result is affected by the market demand for manufacturers’ products. The global economic and geopolitical trends have a direct impact on its performance. The slowdown in economic growth in the region, deterioration of the pricing environment and reduced trade volume has led to a decrease in the overall freight turnover of the transport industry from 493.2 billion ton-kilometers in 2013 to 487.4 billion tkm in 2014. The volume of traffic at that increased by 3.7% and made 3.6 billion tons. The pipeline transport turnover remained at the level of 2013, road freight transport increased by 7.4%, air freight turnover decreased by 21%, and rail freight - by 6.4%.

At the general decline of freight turnover, Kazakhstan Temir Zholy NC managed to finalize 2014 with a profit of $ 163.5 billion tenge and with net income that is 73.5% higher than the target index by attracting additional volumes and an increase in the share of commercial transit cargo, also through costs reduction by 56.5 billion tenge and implementation of the programs enhancing the effectiveness of the KTZ group of companies (with the economic effect of 39.5 billion tenge). Attracted additional container traffic from China to Europe and in the opposite direction in 2014 allowed to increase revenues from the transit by 13.7% on-year. As a result, the share of transit traffic in the total revenues of the company reached 25%. Our task is to increase this index in the medium term up to 50%. The downward trend in turnover holds on in 2015. At the same time, we continue to increase the volume of transit cargo on new routes. By the end of the year we plan to carry 42,000 containers on China - Europe – China route, which 40 times exceeds the 2011 level. Growth in new market segments confirms viability of the strategy for development of the new multimodal competencies that the company pursues in the recent years. – You mean establishment of transport-logistics company in the frames of Kazakhstan’s international

transit hub formation and the Silk Road revival project? – Exactly. On the Head of State’s order, our Company was made the transport and logistics operator of the project, tasked with combining the services of land, sea and air transport and transformation into the transport and logistics world-class company. In connection with it, the transport and logistics assets, including the sea port and airport infrastructure, transport and logistics centers, were integrated into a single transport and logistics holding on the basis of Kazakhstan Temir Zholy JSC NC. Currently, the company provides rail and sea transportation of goods, also port, airport and related services. We are intensively developing new competencies in partnership with leading international operators such as Dubai Port World, Zurich Airport International and Swiss port International. The company’s strategy is aimed at the market of transport and logistics services on the Eurasian continent and the reorientation of freight traffic from sea to overland routes through Kazakhstan. To this end, the company is forming the international transport and logistics chain in alliance with global and local market players and offers integrated transportation services, successfully competing with alternative proposals.

The company has started formation of a network of terminals and logistics centers on the Pacific and Indian, Persian Gulf, Baltic and Black Seas coasts. In 2014, the first external logistics terminal was launched in the Chinese Lianyungang port, enabling consolidation of cargo flows to / from Kazakhstan. It is also the key transit port for transshipment of cargoes to / from Central and South-East Asia, as well as inland ports in China. The project has already demonstrated its effectiveness: in the 6 months of 2015 the terminal has processed 142 000 of twenty-foot equivalents (TEUs), and the end of 2015, the volume of cargo is expected to increase up to 250 000 TEUs, with subsequent doubling by the year 2020. With the acquisition of marine bulk carriers, Caspian carriages were organized, integrated with the services of goods transport by rail and through the port of Aktau. The company plans to develop marine segments of transport corridors East - West and North - South in the Caspian Sea and the Indian Ocean zones. We are developing innovative transport-logistics solutions in the mixed multimodal directions- railway-sea and railway-air on one window principle. – Is the intensive development of the transport and logistics infrastructure in Kazakhstan in recent years connected to the projects planned on new economic policy Nurly Zhol?

– Yes, it is. In view of the plans to boost the transit traffic volume to 1-1.5 million containers a year, corresponding development is required of the main and terminal transport-logistics infrastructure of all modes of transport in Kazakhstan and its integration into the global network. Formation of the transcontinental road corridor Western Europe - Western China is under finalization. New railway lines have been constructed: Zhetygen - Korgas connecting Kazakhstan by the second railway border crossing with China; Uzen - Bolashak, connecting Kazakhstan’s railway network with the railways of Turkmenistan and Iran; Zhezkazgan Beineu and Arkalyk - Shubarkol optimizing domestic and international routes in the north - South and East – West directions. The core of the new economic policy Nurly Jol is development of infrastructure. Under this program the company is implementing projects such as construction of the second track on the Almaty – Shu section, of Borzhakty - Ersai line and a ferry complex in Kuryk, development of Khorgos - Eastern Gate FEZ logistics hub, reconstruction of the Astana Airport’s passenger terminal in preparation for EXPO-2017. The infrastructure development plan also provides for significant work on development of the road network from Astana on the ray principle in the main directions: Centre – East, Center - South, West and North. More than 6,000 kilometers of roads is to be reconstructed under the plan. The total investment will amount to 2.5 trillion tenge. By the end of this year about 600 kilometers of roads are to be put into operation. Commercialization of transport services and introduction of the toll system are envisioned, about

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7,000 kilometers of roads with maximum traffic by the year 2020, along with roadside service. – At the national teleconference with President Nursultan Nazarbayev this July on the Industrialization Day, Kazakhstan’s first transport-logistics center of class A was launched in Astana. What are its characteristics? – This Central Asia’s largest transport -logistics center of class A in Astana lays strict requirements to the warehouse architecture, storage shelving height, temperature, location of the warehouse on the basis of multimodal transport, plus stringent security requirements. The warehouses, equipment, appliances - all that meets the highest international standards. The system automatically displays information about filling of the warehouses, the stored goods, their shelf life, when and where they are to be moved. The system also gives commands to operators as to which products must be repackaged, and which are to be dispatched. This year, a similar TLC will be launched in Shymkent. On the Nurly Zhol program, by the year 2020 transport and logistics centers are to be built in Aktobe, Uralsk, Atyrau, Aktau, Kostanay, Pavlodar, Semey on the main transport corridors of Kazakhstan. It will create a chain of hubs in the key hubs. Hub of the central region will be developed in Astana. Potential investors in these projects are being sought. – What steps is the company taking under “100 concrete steps to implement the five institutional

reforms” – target of joining the ranks of 30 world developed nations? – Development of transport -logistics infrastructure of Kazakhstan and formation of global supply circuits with the use of our infrastructure has laid the groundwork for unlocking of the transit potential. But it is also necessary to create a favorable logistical environment, institutional pre-requisites for transcontinental carriages via Kazakhstan’s territory. We have made the relevant propositions to this end. – Kazakhstan Temir Zholy is implementing a business transformation program initiated by SamrukKazyna National Welfare Fund. What is business transformation to you and what are its first results? – Focusing on best international practices, we are transforming the entire organization of the work (structure, management, production and support

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processes) and culture through the development and change of attitudes of personnel, technology and modernization of production assets. In the freight carriages, optimization of planning, sales, traffic management and maintenance of carriages is envisioned with the introduction of the automated control systems. Transformation in passenger traffic includes measures to improve the process of ticket sales, expanding high-speed carriages, cutting down of unproductive expenditures. Automation of the processes and introduction of resource-saving technologies are also provided in the operation and maintenance of the infrastructure. As part of the transformation in transport logistics, the company is developing its competences in order to meet modern requirements, implying the availability of services, security, speed, quality, individual approach. As part of the transformation, performance strategies were developed with such characteristics as economic added value, customer satisfaction, corporate

2008 to 2014 has doubled, from 70 000 to 134 000 tenge. Three medical trains - “Salamatty Kazakhstan”, “Zhardem”, “Densaulyk” were sponsored that had stopped at 97 stations. – What do you make of the engineering cluster development outlook?

governance rating, transport security, social stability rating and impact on the environment. – Social programs, development of corporate culture, health insurance – all these are important factors. How do you assess the ongoing social policy in the company and does Kazakhstan Temir Zholy meet all the obligations of the employer? – In accordance with international principles of corporate governance the company pursues the policy of social responsibility to employees and society as a whole. Spending on social programs in the group of companies in 2014 made 11.4 billion tenge. Funds are allocated for various kinds of financial aid to workers. The areas of financing on social programs are: program of housing policy, support of young professionals, financial support to large families, single mothers, pensioners and veterans, healthcare program, medical trains, promotion of physical culture and sports among the staff, and various charity events and projects. In order to attract highly qualified personnel the company provides attractive environment for potential and existing employees, social protection and conditions for professional development and personal growth. On the housing program since 2008 our employees were provided with more than 3,000 apartments. The average monthly wage of the company staff from

– The government prioritizes development of transport infrastructure and railway engineering, you know. Speedy formation of world-class transport and logistics system, supporting the creation of knowledgebased economy of Kazakhstan is among strategic directions to meet the national goal of ranking among thirty world advanced nations. Given the state policy of industrialization and import substitution, and the need for technological upgrades, our company has undertaken modernization of assets through the organization of own production. In partnership with world leaders such as General Electric, Alstom, Talgo and others, productions of freight and passenger locomotives, electric locomotives, wagons, large car casting were built to make the current production volume of 200 billion tenge. New productions are developed. By the end of the year the Aktobe rail plant will make the first Kazakhstan’s rail, certified in accordance with the technical regulations of the Eurasian Economic Union. The products of our plants have considerable export potential and are already delivered to the markets of the Eurasian continent. – In recent years, the KTZ has been launching high-speed passenger trains, formed of Tulpar-Talgo cars, significantly reducing the travel time. There are improvements in the service too. What are the plans for further development of the passenger traffic? – Program of high-speed passenger carriages is under development to improve the quality of passenger services. Currently, high-speed passenger trains, formed of Tulpar-Talgo wagons run on eight routes: Almaty - Petropavlovsk, Astana - Aktobe, Astana - Atyrau, Almaty - Atyrau, Almaty - Aktobe, Almaty - UstKamenogorsk, Astana - Ust-Kamenogorsk, Astana - Kyzylorda. More high-speed trains will be launched. In 2015 H2, trains Astana - Uralsk, Almaty - Aktobe, Astana -Ust-Kamenogorsk are to be launched. We are working to raise the level of comfort and service in the long-distance and commuter trains. Modern forms of passenger service are being introduced such as ticket sales through the Internet, electronic tickets. Since November of last year a system of tiered pricing was introduced on high-speed trains Talgo, depending on sales and demand.

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Karl BAIPAKOV, Director of the Institute of Archaeology of the Academy of Sciences of Kazakhstan

The Great Silk. Way – a dialogue of cultures

To most people the ancient trade between East and West through Central Asia is encapsulated in the term ‘The Silk Road”, generally considered to be represented by the trade routes passing from China through modernday Xinjiang, over the high passes of the Tien Shan and Pamir mountains to the fabled cities of Samarkand, Bukhara and Balkh, etc, before continuing across Persian territory to the Middle East and the civilisations of the Mediterranean. The generally accepted starting date for the Silk Road is 138 BCE, corresponding to the western journey of Zhang Qian from Han China, but the idea that it was his information about the “Western Regions” that opened the way for intercontinental trade is inaccurate and requires revision.

Certainly from the mid-second century BCE there was a leap in diplomatic and commercial communication, and more concerted and organised trading began to take place in both directions, but there is a huge amount of evidence proving that considerable traffic along the routes between China, the Mediterranean, the Indian subcontinent and northern Europe, had begun even earlier. According to the Russian archaeologist Elena Kuzmina, the prehistory of the Great Silk Road can be traced back to the late second to early third millennia BCE, when the expansion of the Bronze Age SintashtaPetrovka and Andronovo cultures in the Eurasian Steppe spanning the Ural Mountains saw agricultural

products, livestock (including domesticated horses) and metallurgical technology (chariots, etc) spread throughout the region, from southern Central Asia to Mycenaean Greece. Routes can be traced connecting Siberia with Central Asia and Semirechye with Xinjiang - Andronovo ceramics and bronze products such as axes, sickles, adzes, spearheads and arrowheads, as well as golden earrings and mirrors, have been found to substantiate this. Trade of two valuable minerals had also developed at this time,* mining of lapis lazuli in the mountains of Badakhshan and jade in the upper Yarkand River near Khotan resulted in lapis being exported to Iran, Mesopotamia, Anatolia, Egypt and Syria, and the “Jade

Road” connecting the Tarim Basin with China. During the early Iron Age these routes continued to develop,- the exchange and range of goods increased, and a dialogue of cultures developed, with innovations in technologies, types of metal products, military strategy and skill with the horse and chariot all being shared. The sixth-third centuries BCE saw a period when large empires were formed and military campaigns between the Persians and the Saka, as well as conquests by Alexander the Great, characterized a new stage in the trading routes which may be called the “Proto-Silk Road”. This time corresponds to the formation of states such as Bactria, Khorezm, and the tribal groupings of

the Saka and Scythians in the Zhetisu (Semirechye) and Aral Sea regions respectively, which had close ties with Han China and Achaemenid Iran. Both Chinese silk and Iranian goods have been discovered in the excavations of “royal” kurgans within Semirechye (Issyk) and the Altai (Pazyryk, Bashadyr, Tuekty, Shibe, Ulandryk, Ak-Allah and Berel - a silk blanket with phoenixes on it was excavated from a Pazyryk kurgan dating to the fifth century BCE),- within burial sites in Xinjiang (Subashi, Kyzylgok and Zaghunluk); even as far north as the Arzhan sites in Tuva (modern-day Russian Siberia). In all likelihood Central Asian cities and settlements belonging to tribal groups including the Saka, Pazyryk and Scythians, and later the Wusun, Xiongnu, Kangju, Savromats and Sarmatians, formed links in a farreaching road that began at the big bend of the Yellow (Huang He) River in northern China, crossed the Altai Mountains to the Irtysh River, spanned the endless steppes of Kazakhstan and the Black Sea region, before finally reaching the lands of the Greeks and Etruscans. Descriptions by the Greek “father of history” Herodotus show that this was a regular route for the transfer H of goods and cultural ideas, with the nomadic I steppe tribes of the Saka and Scythians playing an active part in their distribution between East and West.

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TRADE AND CULTURAL INTERACTION From the second century BCE on, new tribes and kingdoms took over Central Asia. The Wusun migrated from the Gansu region of China and overran the Saka Tigraxauda of the Semirechye region, the Kangju created a kingdom on the middle and lower Syr Darya, and the Yuezhi - also migrants from China’s Gansu area - passed through the Tien Shan and created the Kushan Empire in former Bactria and Ferghana. The consequences of Zhang Qians journeying and greater communication with China were gamechanging. The system of caravan routes that connected China, Korea and Japan with Europe, the Middle East and India now grew more extensive and organized, evolving until it represented a phenomenal achievement of human civilization. It was to this period that the German scholar Ferdinand von Richthofen was referring when in 1877 he named it “the Great Silk Road”. Along this road - or more accurately this multitude of tracks and trails - there was constant two-way movement of goods, scientific innovations, cultural values and religions. It was a conduit for merchants, missionaries and diplomats, a channel of important information - in fact it was the Internet of its day.

The huge distances and cultural diversity between the far reaches of Eurasia gave rise to exaggeration and fanciful tales by those who journeyed along the Silk Road - the reports of such notables as Zhang Qian, the seventh- century Chinese monk Xuan Zang and William of Rubruck during the later Mongol period, can seem fantastic at first glance. Their travel descriptions abounded with miracles and were often coloured by fairy tale: legends of blood- sweating “heavenly” horses, of fearsome warrior women called Amazons, of amazing creatures called centaurs that were half human, half horse, all had their roots in fact. The horses of the Ferghana Valley were of superior stock and famed for their endurance, the women of the steppe tribes were known to don armour and fight alongside their men, and the remarkable horsemanship of the nomadic warriors caused some to imagine that beast and man were in fact one. Other tales of people with dog heads, of hairy Cyclops and “griffins guarding gold” in the remote northern mountains are harder to explain but all coatributed to the mythical nature of the Silk Road in Central Asia. The migration of the Wusun tribe from the east into the Hi Valley, Semirechye and the Tien Shan around Issyk-Kul coincided roughly with the “beginning” of

the Silk Road as many perceive it. From the first century BCE through to the fall of the Han Dynasty in 220 CE the export of Chinese silk and other Chinese products to Western kingdoms blossomed. In turn, goods from Rome, India and Iran came back east. The list of exotic goods that passed through Central Asia, crossing desert, steppe and mountain pass, is almost endless. There was myrrh and frankincense oil, jasmine water and amber, cardamom and nutmeg, ginseng and python bile, carpets and canvas, pigments and minerals, diamonds and jasper, jade and corals, ivory and furs, silver and gold ingots, weapons such as bows and arrows, swords and spears, and many other items. Animals of all shapes and sizes were transported: Ferghana and Arabian horses, camels and elephants,rhinoceroses and lions,- cheetahs and gazelles,- hawks and falcons,- peacocks, parrots and ostriches were all brought for sale along the Silk Road. Cultivated plants such as grapes, peaches and melons were also transported and introduced far from their origins, along with spices and sugar, vegetables, fruits and herbs. But material goods aside, there were other equally significant benefits for all the peoples living along the trading routes and at their terminuses. Cultural developments spread down the Silk Road with the

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merchandise,- travelling with the cargo-laden camels of the great caravans were artists, musicians, early scientists and craftsmen. Although there is little evidence left from this early period of Silk Road history, later ruins from the eighth-ninth century site of Kostobe in the Talas Valley, which have been identified with Jamukat city, show a thick layer of plaster sculpted into panels of grapevines, tulips and rosettes with intricate borders, similar in artistic style to the Baghdad caliphate and Egyptian culture of the time. The art of music and dance was also shared along the Silk Road. Spectacular shows, a kind of medieval “show business”, became popular in countries of both the East and West. Performances of musicians and dancers, wild animal acts, acrobats and magicians could be seen in cities and encampments from China to Rome. Translations were not needed for most of these acts,- language barriers were not an issue, so the same performances were shown to Greek socialites, Kievan princes, nomadic lords, Turkic khagans and Chinese emperors. It is well documented that the Chinese courts of the early centuries CE, and in particular of the Tang Dynasty during the later Turkic period, were besotted with the “Music of the West”. Music, dance, even hairstyles and clothing from the Central Asian cities of Bukhara and Samarkand - and those of East Turkestan like Khotan and Kucha, which in turn had been influenced from India - merged with Chinese musical tradition. The idea of foreign exoticism became all the rage in Tang Chinas imperial court, and from there spread to wider society,people followed the nomadic fashion of clothing, wearing Turkic hats and long coats, while noble ladies preferred to ride horses than travel in carriages. RELIGIONS ALONG THE SILK ROAD One of the Silk Road’s most important contributions to world history is its role in the dissemination of religious ideas across Eurasia. Buddhism came from India, Nestorian Christianity and later Islam came from

the Middle East, and eastern Persia was the birthplace of Zoroastrianism and Manichaeism. Through the movement of their adherents, over the centuries all these faiths came to the towns, countries and regions of the Silk Road, taking root in the thriving cities of Transoxiana and the nascent urban centres of the middle and lower Syr Darya, or influencing the tribal confederations that occupied Kazakhstan and who practised polytheistic and shamanistic beliefs. Archaeological discoveries provide evidence of the expansion of ancient beliefs, a prime example being the Kargaly diadem (a golden bejewelled headband) found near Almaty. Alexander Bernshtam dated the diadem to the Wusun of the first-second centuries CE and interpreted its figures as winged horses on mountain peaks, winged females riding dragons, a panther, wild goat and sheep, a bear and deer with geese or swans flying over them - all surrounded by floral ornamentation. He associated the symbols on the diadem with shamanism and noted a Chinese influence. However, Elena Kuzmina dates the diadem from the second century BCE to first century CE and thinks that the diadem originates from Saka art (like that of Issyk, Tilly a Tepe and Khokhlach). She considers the diadem to be a model of the world, with the birds above it being mediators between the three worlds: sky, earth and water. The winged horse is the sun, while the deer is a symbol of the renewal of spring. The diadem is therefore related to the cult of Dionysus, the god of dying and revival of nature, and Nowruz, the Persian New Year. Whatever its provenance and symbology, the diadem shows the importance and huge influence that new beliefs had on the inhabitants of Central Asia. Theologians and missionaries, in particular Sogdians, Parthians and Kangju, played an important role as they ranged up and down the Silk Road, proselytizing their dogmas. Zoroastrianism, which originated in the seventh-sixth centuries BCE in ancient Iran, made early inroads into Central Asia - there is evidence that elements of the faith took hold in the Saka and Massagetae tribes of southern Kazakhstan.

The Zoroastrianism that spread through the later Kangju and Wusun territories courtesy of the Sogdians was a variant form of the canonical faith; it was closely interwoven with local shamanistic beliefs, particularly with the cult of fire, ancestor worship and animism as related to sheep, horses and camels. Archaeological discoveries of burial sites containing ossuaries of human bones, and corpses laid in above-ground sepulchres, indicate that these were worshippers of Zoroastrianism. In the Otrar oasis a palace complex was excavated at the site of Kuiryktobe citadel that shed new light on the level of religious artistry to be found in this region during the early years of the first millennium CE. In the centre of the complex a 157.5-square- metre main hall was uncovered, damaged by fire but with part of its ceiling fresco preserved. This showed a divine couple, the male sporting a classical jagged crown, holding a rod with three curved spears at the end and seated on a zoomorphic throne in the form of two winged camels, the female wearing a ribbon with a bow around her forehead and seated on two argali sheep with curving horns. Also displayed is a siege of a fortified city, two warriors shown with bent bows standing on the city wall, which has castellated towers. In front stands the four¬armed god Nana-Anahita wearing a winged crown, with both hands raised holding the sun in one hand and the moon in the other. Collections of carved wood from Kuiryktobe can tell us much about the religious views of those who lived in the cities along the Syr Darya, where Sogdian influence was widespread. Initially bringing Buddhism, the Sogdians were also responsible for introducing Manichaeism, which originated in Iran in the third century CE and combined elements of Christianity and Zoroastrianism. Manichaeism

quickly gained in popularity, establishing footholds from the Mediterranean through to China. The ruins of Manichaean monasteries can still be found in Semirechye, and an ancient Uighur manuscript using Manichaean script called The Sacred Book of Two Foundations, found in Xinjiang’s Turpan oasis, states that it was written in the city of Argu-Talas “to awake [faith] in the country of ten arrows” - a reference to the city of Taraz. During excavation of a site in Taraz, a bronze medallion was discovered displaying the image of a female with the crescent moon, a symbol of the Manichaean astral deity. Nestorian Christianity came from the eastern Roman Empire (Syria) in the fifth century CE, brought by followers of the priest Nestorius, whose doctrine had been condemned as heresy at the Council of Ephesus in 431. Cruel persecution of the Nestorians forced them to escape to Persia, from where they looked to the East to find converts and new commercial markets. Nestorianism eventually became widespread throughout the cities of south Kazakhstan and Semirechye, and by the seventh-eighth centuries had reached Tang China. Between the second century BCE and the sixth century CE these waves of new religious beliefs swept through Central Asia, finding favour among the citizens of the burgeoning Silk Road cities in Transoxiana, the Syr Darya Valley, Semirechye, the Tien Shan foothills and on into the Tarim Basin and its city-states around the edge of the Taklamakan Desert. While without doubt this was still a violent time, with frequent wars and conflicts between kingdoms, it was also a period of immense gain - materially, spiritually and culturally - for the many diverse peoples to be found along the Silk Road in its heyday.

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Kairat LAMA SHARIF, H.E. Ambassador of Kazakhstan to the United Arab Emirates

New Silk Road, from Kazakhstan to UAE Some 43 countries in the world are landlocked: 15 in Africa, 14 in Europe, 12 in Asia and two in South America. This list contains all the countries of Central Asia: Kazakhstan, Uzbekistan, Turkmenistan, Tajikistan and Kyrgyzstan. However, some landlocked countries do not suffer from their inconvenient geographic locations. For example, landlocked Switzerland is among the top 10 countries of the world in terms of economic competitiveness. Austria, also cut off from the open sea, has very high levels of economic development and public welfare in comparison with its coastal neighbours. Another example is Kazakhstan, the largest landlocked country in the world, which is bordered by two inland seas: the Caspian and Aral Seas. For Kazakhstan, being landlocked is not an obstacle to its economic development, since its location in the centre of the Eurasian continent predetermines its geopolitical role as a bridge between Europe and Asia. In recent years, the centre of gravity of world trade and production has been shifting to Asia, objectively increasing the value of the transport component of interstate cooperation. Kazakhstan occupies a unique position as the most comfortable and safe transit route from Europe to Asia. Currently, Kazakhstan’s territory is crossed by four international transport corridors connecting China and Europe, including the TRACECA (Transport Corridor Europe-Caucasus-Asia). As they say, now all roads lead to, or rather, through, Kazakhstan.

Today, China’s rapid economic growth, particularly in its western regions, requires the delivery of various products to world markets. Therefore, in the near future, it is expected to put into operation a new international highway, the Western Europe – Western China corridor. The total length of the road will be 8,445 kilometres, of which 2,787 km will be in Kazakhstan. This transit corridor will reduce by almost 3.5 times the time it takes to transport goods from China to Europe, as compared to the sea route (from 40 days by sea to 10 days by land). Moreover, it’s expected that in the next 10 years, the volume of cargo transportation through Kazakhstan’s territory will more than double. In this regard, the first major breakthrough in the field of logistics development is the establishment of the Khorgos-East Gate special economic zone (SEZ) on the border with China, which will operate as a “dry port” in the international transport and logistics sector. As part of the strategy of the New Silk Road, the Kazakhstan Temir Zholy national railway company has already established a partnership with global port terminal infrastructure operator Dubai Port World (DP World). With DP World, the Kazakh company has designed a general line of vehicle interaction with the seaport of Aktau and its linkage with the Khorgos-East Gate project in the organisation of global supply and the integration of Kazakhstan’s infrastructure services into the world trade and transport chain. Currently, the two companies have been establishing the necessary legal framework for cooperation, including a management agreement for the Aktau

seaport on the east coast of the Caspian Sea and the Khorgos-East Gate SEZ. At the same time, taking into account their favourable locations, as well as the relevance of the historical revival of the Silk Road, Kazakhstan and other countries are making every effort to create a transcontinental transport link between Central Asia and the Gulf region. The Gulf region is of key importance for Kazakhstan in maintaining growth in foreign trade. This is dictated by at least three defining factors. First, the Gulf region is the epicentre of interests for a growing number of shippers in Asia and Europe. Experts predict that a large amount of traffic from China to Europe, the Middle East, Central Asia and the Caucasus will soon be reoriented to the Gulf region. Secondly, port and storage capacity at the world’s largest transport hubs and international container carriage will provide the shortest routes to Southeast Asia, the African continent, India and beyond. Finally, there is the possibility of expanding Kazakhstan’s export potential due to the region’s high demand for food products (the Gulf is 80 – 90 percent dependent on food imports). The great importance of the potential of the UAE’s port capacity, which takes on the role of the south gate in the North – South international transport corridor, must be highlighted. This is one of the priorities of the Eurasian routes, including the transport network in Kazakhstan. Kazakhstan’s President Nursultan Nazarbayev, speaking at the World Islamic Economic Forum in

Dubai in October, noted that more than 10,000 km of roads and 2,500 km of railways have been built and rehabilitated in Kazakhstan, so the distance between China and the Gulf has been reduced by 1,200 km. Moreover, in the next few days, the new KazakhstanTurkmenistan-Iran railway will open, which is an important component of the North – South international transport corridor. The new railroad will provide convenient and cost-effective transport for goods from Kazakhstan to the Emirati ports in the Gulf. The North – South project, with the assistance of the Asian Development Bank and the Islamic Development Bank, is based on a signed agreement between Turkmenistan, Iran and Kazakhstan from 2007. Implementing the project will also open up access to European and Asian countries in Central Asia and the Gulf region. A similar opportunity will appear for the transit of goods from South and Southeast Asia to Northern and Eastern Europe through Iran, Turkmenistan, Kazakhstan and Russia. President Nazarbayev highlighted that this transnational project has historical significance. “The new track is the shortest route for goods delivery and transit and, in the future, for commuters. Nowadays, time is a critical factor. In this regard, shortening turnover provides a significant competitive advantage. This advantage is reflected in business and, eventually, in increased prosperity for our countries,” said the President. Opening transit and foreign trade cargo traffic within the North – South corridor is a profitable alternative to existing means of transportation.

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It is 120 nautical miles or 221 km from the port of Bandar Abbas to the UAE’s Hamriyah port. Thus, the total developed length of the new Silk Road from Kazakhstan to the Emirates is 3,377 km, two times shorter than the air corridor from Dubai to Shanghai. The new route, according to experts, will reduce the length of transit by 10 – 12 days compared to the traditional sea route from Asia to Europe via the Mediterranean Sea and the Suez Canal, which takes 35 – 40 days. With appropriate transport infrastructure, this will allow us to reduce transportation expenditures by 30 percent. There is also great potential for the construction of transport and communication infrastructure meeting international standards to be built along the rail routes, bridges and other related facilities, including residential complexes for staff. Due to changes in the geopolitical situations of countries with their own access to the Black Sea, the Caspian Sea’s role has increased. There are objective prerequisites for the transformation of the Caspian Sea and the coastal areas as an important transit centre between Europe and Asia. We are talking about the powerful traffic flow from Asia to Europe and back. According to preliminary

estimates, 3 – 5 million tons of cargo per year will be shipped on the main line from the Caspian Sea to the Gulf initially, and volumes will increase to 10 – 12 million tons. Today, Kazakhstan ranks among the world’s leading exporters of ferro-alloys, copper, lead, zinc and mineral fertilisers. Our country has also reached the top position in the world for the export of flour and wheat. During his meeting with Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and ruler of Dubai, President Nazarbayev said that Kazakhstan could become a global centre for food security. The total area of agricultural land in Kazakhstan is 90 million hectares, of which 25 million hectares is arable land and 61 million hectares is permanent pasture. With the new international KazakhstanTurkmenistan-Iran railway, the export of Kazakh wheat has the potential to increase by five times. According to experts, the UAE are also ready to buy up to 500,000 tonnes of mutton from Kazakhstan. An effective catalyst in the promotion of bilateral trade and economic cooperation will be the main traffic artery of the 21st century, connecting Kazakhstan with the UAE.

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Nurlan ADILKHANULY, Head of the Department of Regional Studies of Kazakh University of International Relations and World Languages named after Abylaikhan

â&#x20AC;&#x153;Khorgos - Eastern Gateâ&#x20AC;? will make Kazakhstan a leading transit country of the region Geographic features of Kazakhstan (vast territory, lack of access to the sea, uneven distribution of settlements and natural resources) makes its economy one of the most cargo intensity in the world, causing a high dependence on the transport system. Being at the crossroads of Europe and Asia, Kazakhstan has great transit potential, providing Asian countries there is no alternatives to land transport connections with Europe. Location of the Republic of Kazakhstan in the center of the Eurasian continent predetermined its geopolitical role as a transit bridge between Europe and Asia. Today on the basis of the existing transport infrastructure Kazakhstan has four international transport corridors: - Northern Corridor of Trans-Asian Railway (TARW): Western Europe - China, Korean Peninsula and Japan through Russia and Kazakhstan (Dostyk Aktogay - Sayak - Mointy - Astana - Petropavlovsk); - Southern Corridor TARW: South-Eastern Europe China and South-East Asia through Turkey, Iran, Central

Asia and Kazakhstan (Dostyk - Aktogay - Almaty - Shu - Aris - Saryagash); - TRASECA: Eastern Europe - Central Asia via the Black Sea, the Caucasus and the Caspian Sea (Dostyk - Almaty - Aktau); - North-South: Northern Europe - Gulf States via Russia and Iran with the participation of Kazakhstan in the areas of: sea port Aktau - Ural regions of Russia and Aktau - Atyrau. These roads have been actively developed just over the last decade, but the processes of globalization of the world market and the growth of world trade in Central Asia may cause the appearance of new alternative transport routes in the region. To strengthen its position in the competition for transit traffic, some neighboring Kazakhstan states are taking active measures to develop the national transport infrastructure and enhance the competitiveness of transport and logistics system in order to reorient the Eurasian freight traffic on their routes. For example, China, Kyrgyzstan and Uzbekistan

are working on a project to build a railway section “Kashgar-Osh-Andijan” (430 km), followed by access to Afghanistan and Pakistan. As part of the Central Asia Regional Economic Cooperation (CAREC), Turkmenistan, Afghanistan and Tajikistan are planning to build a railroad (400 km), which connects the Afghan section Akin-Andkhoy with the segment-Atamyrat Ymamnazar in Turkmenistan and Nizhny Panj in Tajikistan. When this project will connect Tajikistan in northern Afghanistan near Mazar-i-Sharif to the railway “China – Kyrgyzstan – Uzbekistan – Afghanistan - Iran.” Azerbaijan and Iran is constructing a new railway line “Astara-Rasht-Qazvin” (375 km), which connects to the railways of Russia in the international transport corridor “North - South”. China and Pakistan are currently implementing two major transport and logistics of the project: construction of the railway “Kashgar-Gwadar-Khunjerab” (total length of sections 1224 km), passing along the Karakum highway, and transfer to Pakistani sea port of Gwadar by Chinese company “Chinese Overseas Port Holdings

Limited”. This creates a new shorter transport corridor from Western China to the Indian Ocean, which links to the Middle East and Africa will flow Chinese goods, and back to China - minerals and Middle East oil. Gwadar transport hub at the same time has the strategic importance to China opening up access to sea routes the main energy routes leading to the Persian Gulf to bypass the Strait of Malacca. In the face of increasing international competition and the search for new alternative routes the Republic of Kazakhstan faced new tasks to improve its own national transport and logistics system. In Kazakhstan’s strategic plan of “Strategy” Kazakhstan - 2050 “: New political course” the President Nursultan Nazarbayev has set a task to double transit through Kazakhstan in 2020 and 10 times - in 2050. “It is important to focus on the output of the country to create a production of transport and logistics facilities”, - said Kazakhstan leader. The practical implementation of developing of Kazakhstan’s transport infrastructure up to 2020 was assigned to the National Company “Kazakhstan Temir

Zholy” as a national logistics operator of the Republic of Kazakhstan. In accordance with the Kazakhstan Government order National Company “Kazakhstan Temir Zholy” has begun to implement one of the largest regional project” Creation and complex development of the Special Economic Zone (SEZ) “Khorgos - East Gate”, including the “International Centre for CrossBorder Cooperation” (ICCBC) Khorgos” with the strategic importance for the development of transport and logistics system in Kazakhstan. The project “International Centre for Cross-Border Cooperation”(ICCBC) Khorgos “was established by an intergovernmental agreement between China and the Republic of Kazakhstan March 4, 2005. Its purpose was to organize cross-border cooperation platform, including logistics and trading business, tourism and hotel services. The center is located on the border between Kazakhstan and China on the territory of Panfilov district of Almaty region (36 km from the city of Zharkent). The territory of ICBC “Khorgos” is 528 hectares, of which 343 belong to the Chinese and 185 to Kazakhstan. For visitors it provides a non-visa regime for the period of 30 days, which means free movement of people, goods and vehicles between Kazakh and Chinese parts of ICCBC “Khorgos”. The only rule -

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“From which side you enter, from it you must exit”. In addition, goods, which are imported into the territory of Kazakhstan, will not subject to customs duties, if its cost wouldn’t be higher than 1500 euro and weight no more than 50 kg. Nowadays in ICCBC “Khorgos”, exists favorable conditions for citizens of the Republic of Kazakhstan and third countries for doing business and conduct cultural activities. Also, center provides all the conditions for unimpeded and high-quality visitor services, on a modern checkpoint, traffic of which allows for fast track procedure of border and customs control. In addition, there are special vehicles for the transportation of goods and visitors. Multifunctional building (MFB) performs registration of visitors since April 18, 2012, with the capacity of the passenger terminal more than 10,000 people per day. In 2015, here planning to complete construction of all facilities of the cargo flow, which creates opportunity skips cargo transport without delays. In addition, there are completed the main construction and installation works on infrastructure projects: roads, well-arranged area, held power lines, sewer & water networks, backbone heating network within territory of ICCBC “Khorgos”. According to the information of Customs Control Committee of the Ministry of

Finance of the Republic of Kazakhstan, since the beginning of functioning of the Centre, inflow to the budget of customs duties and taxes has reached in the amount of 69 million tenge. There were registered 78 tons of goods and 694 customs receipt. ICCBC “Khorgos” accepts visitors on both sides of the border. On its Chinese part, operates temporary Marketplace, the mall “Jiang Yuan”, “Theatre Centre Ethnographic Park of Shanghai Cooperation Organization” and “international tourist center”. At the present time in

shopping center “Jiang Yuan” in a broad assortment of goods of daily use: clothes, shoes, dishes, furniture, electronic equipment (TVs, laptops, mobile phones), baby toys, car accessories and so on. Soon on each side of the center is planned to open new retail spaces, where the range of products will be formed on the basis of researches of Kazakh and Chinese marketers. Particular interest to the unique in global scale’s project pays attention such large countries like the United States, Russia, Germany and many others.

And confirmation of this - visits Consuls General of the Russian Federation, the United States, Germany, Deputy Secretary of the Republic of Latvia and the large investment companies in the UAE, the Netherlands, Belarus, Uzbekistan and Republic of Korea. At the end of July of this year, were held introductory meetings with the new Consul General of Germany and representatives of the German business community, representatives of the Asian Development Bank, the World Bank and so on. The Special Economic Zone (SEZ) “KhorgosEastern Gate” with the territory, consisted of 5740 he, was established to create the chemical products, steel industry, food products, textiles and other goods for export to other countries. It includes industrial, residential area, as well as “dry port” (logistics business). All the elements of SEZ: “Khorgos- Eastern Gate” together with ICCBC “Khorgos”, railway Zhetygen Khorgos and highway Western Europe - Western China are creating real conditions for the development of a large logistics hub. The expected turnover will increase to 12 million tons by 2020. Advantages of creating SEZ consist in the fact that our country will be able to further develop economic and cultural ties with neighboring countries and Kazakhstan’s products will be integrated into the global system of production and distribution. According to the authors of the project in Kazakhstan will produce innovation, competitive domestic products, which will fulfill international standards. In addition, will be created a favorable investment climate, thereby both domestic and foreign investors will be able to realize

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their projects , as well as increasing number of new job places. SEZ participant can only be a legal person (residents and non-residents), thus it is necessary to have the financial means or other liquid assets that are not taken out of circulation, in an amount not less than the cost of the project feasibility study. Legal entities which cannot operate or conduct activities- the subsoil user, organizations producing excisable goods, organizations applying special tax regimes or those who apply investment tax preferences, as well as organizers of gambling. Therefore, the participants of the SEZ have a whole package of fiscal incentives. In particular, the reduction in the corporate income tax (CIT) on 100 percent, property tax at the zero rate, VAT at the zero rate when implemented on the territory of SEZ goods, consumed by members of the SEZ, exemption from rent for the land in the medium term period. On SEZ territory, already functions customs procedure - free customs zone. Product which is made by using foreign goods, placed under the customs procedure of free customs zone residents, registered in the SEZ before January 1, 2012, is recognized by product of customs union before January 1, 2017. In order to ensure the functioning of SEZ “Khorgos”, established Management Company, special economic zone “Khorgos - Eastern Gate”. The only shareholder is JSC “KTZ Express”, which, in turn, is a subsidiary of JSC “NC Kazakhstan Temir Zholy”. In May 2012, the state commission on modernization agreed on the need to attract international consultants

for realization of project on management dry port SEZ “Khorgos” with the integration with the seaport Aktau (“Western Gate”). In November, 2013 in Astana in the framework of the II International transport and logistics business - forum “Kazakhstan - New Silk Road” by the management company of a special economic zone “Khorgos - Eastern Gate” signed long-term contract with the DP World Terminal Services B.V. company, for a period of 10 years. DP World is the world’s largest port operator based in the free economic zone of Dubai “Jebel Ali” (UAE). The company manages 60 terminals operating in the 31st country in the world, covering six continents. In July 2, 2014 President of Kazakhstan Nursultan Nazarbayev during the national teleconference with the regions, in the online mode, gave a start to construction of a dry port in the FEZ “Khorgos - Eastern Gate”. Construction of the first phase (dry port and 30 percent of infrastructure logistics zone) will be completed this year. Planned cargo flow in 2030 is 4.8 million tenge. Potential participants of SEZ are Hewlett-Packard, Toyota, DHL and logistics companies (China, Turkey, Russia, Georgia, Uzbekistan, Azerbaijan, South-East Asian states). Highlight that the project SEZ “Khorgos Eastern Gate” –is the most important item of logistics in

Kazakhstan, the development of which has the strategic importance not only for Almaty region, but also for the Republic of Kazakhstan as a whole. Taking into account the strategic location of ICCBC “Khorgos”, its uniqueness, we can talk about the appearance in our country first pilot, complex, international platform of border cooperation, which can give a strong impetus to the exchange of information, enhanced trade, implementation of new technologies and the improvement of customs procedures. This project, certainly also be the main pillar of the new Euro-Asian bridge connecting transport and logistics hub “Khorgos” with the leading transport terminals of the world: Asia-Pacific countries, East Asia and Europe. Today, the transport capabilities of Kazakhstan are considered by experts as new, after the oil and gas industry, a platform for economic growth. These requires improving the attractiveness and create the most modern and effective transport and logistics system in Central Asia, which should include a wide range of services, competitive rates and improved corridors for transit cargo flows on an ongoing basis. So, the growing transit potential may turn Kazakhstan into a leading transit country of the region.

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Sanzhar ELYUBAYEV, The president of “KTZ Express” JSC

KTZ Express: From a dry port to a sea port - an entire country in between “KTZ Express” JSC was established in June 2013 under the auspices of the “National Company ‘Kazakhstan Temir Zholy’” JSC. It is a multimodal transport and logistics company of an international level. The International sea trade port Aktau, “Khorgos – Eastern Gates” FTZ and 11 of Kazakhstan’s airports are under the management of this company. “KTZ Express” integrates railway, sea, air and road transport, an infrastructure for sea ports and airports, as well as a network of terminals and transport and logistics centers. According to the results of 2014 the company managed the transport of 2,077 tons of cargo. Overall, last year’s gross earnings amounted to 10.9 billion tenge, and earnings from operational activities – 1.1 billion tenge. KTZ Express is also directly engaged in container transport, development of prospective transit routes through Kazakhstan. The logistics branch of Kazakhstan Temir Zholy has secured additional volumes of transit shipments between China and Europe. In 2014 a 222% rise in these shipments was registered (from 6568 to 21192 TEU) or an increase by 3.2 times. The president of “KTZ Express” JSC, Sanzhar ELYUBAYEV, told more about this in an interview with our correspondent. The talk began with a discussion of an interesting project, which the company realized at the end of December of last year, implementing the “Rail-Air” logistics solution for the transport of cargo from China to Europe, through Kazakhstan.

“RAIL-AIR”: - Mr. Elyubayev, in the realization of “Rail-Air” railway and air transport interlink. Is this pilot project symbolic for the multimodal “KTZ Express” company? - “Rail- Air” is a unique solution for cargo transport. This is the first pilot project of multimodal transportation by railway from China to Almaty, and further on to Europe by the connecting air transport. Jointly with our partners in logistics we were able to realize a shipment of electronics from China to Europe, over a distance of 9,900 kilometers, in just 7 days! Earlier, for such transit schemes, air and road transport was used. There was also the use of the “Ocean-Air” practice, when for example, cargo is shipped by sea to Dubai, and then by freight planes on to Frankfurt. We are the first to come up with a solution which uses the railway system along the container transit route Chongqing – Duisburg. The pilot project was realized within a common customs and transit regime, according to the plan that was approved by the airport, the customs committee and our company. This is necessary in order to avoid customs clearance during the delivery of the freight wagon to the airport. The whole operation was started in Chongqing,

where a train was loaded with one 45 foot container, which maintains a special temperature regime. At the border station Dostyk the wagon was detached and sent to Almaty. There it was unloaded at a temporary storage warehouse, and then, it was flown to Amsterdam by cargo air transport. In terms of the transit period, the potential of this pilot project is 6 days, which is a good result. For comparison: airshipment would have cost approximately 50 thousand US dollars. Railway shipment today takes 14 days and costs 10 thousand US dollars. “Rail-Air” – around 30 thousand US dollars. Of course, by air transport the cargo would have been delivered faster, in one day. But, it would have cost more. In our case, for our client the difference between 1 day and 6 days was not as critical in comparison with the 30 days, that it would have taken for the cargo to be delivered, had it been sent using the “Ocean-Air” scheme. We have a different focus and offer a good alternative to air transport in terms of the price and shipment of cargo that needs to be delivered fast to the market. This is a great solution for all clients who are interested in getting their products first on the market. It is the first time that we’ve worked out this scheme with the railway system, customs, an airport and an airline. Although it was difficult to realize in terms of getting the documentation in order and working out the technological aspects. The cargo is arranged in Chongqing, and our

representative monitors this process. At the Dostyk station we reload the container and it is not opened up until it reaches the end consumer. This is one of the advantages of this solution. We were able to ensure the security and safety of the cargo along the route. I am confident that a big future awaits this project. - You noted the cost-efficiency of this solution for the clients. And for Kazakhstan Temir Zholy – is it unearned revenue on railway transport? - In this case, cargo transport is diverted from air transport and not railway transport. This is an alternative to air shipment, and not shipment by railway. If we hadn’t set up this project, the cargo would have been flown by us on a freight plane out of Chongqing directly to Europe. In the wintertime, from October to spring, container freight trains no longer go along the Chongqing – Duisberg railway route. This is because the HP company transports equipment that freezes in regular containers while passing through the northern regions of Kazakhstan and Russia. In Europe the weather is also often not fitting for railway transport. That is why, during this period, traditionally sea transport was used, and in case of urgent shipments – air transport. - Is this why “KTZ Express” JSC procured special temperature-sensitive cargo containers?

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- We acquired specialized railway vehicles in order to increase the volume of transit shipments, so that they can be done all year round. These are specialized 45 ft refrigerator containers with the Unit-45 climate control system, which operate in an autonomous mode for up to 22 days. Under any below-zero temperature in the winter or above-zero in the summer we can maintain a specific temperature regime that is required by the sender of the cargo. Since our pilot project is being realized in the wintertime, in cold-storage containers, in which expensive electronic equipment that is temperature sensitive, was being transported, a temperature of +5 degrees Celsius was maintained. By the way, right now combined trains are being put together, which will include cold-storage containers and universal containers. Notebooks are loaded into cold-storage containers and less sensitive printers can be loaded into universal ones.

An analogous project is being worked out with the provinces Zhengzhou, Wuhan and Chengdu. I would like to note that the volume of shipments using the modal “Rail-Air” scheme per month is not that big in terms of the number of containers – from 5 to 30 containers. But, in terms of the marginal commission, it exceeds shipment by railway transport by a couple of times. This multimodal scheme is one of our showcase products. There are other logistics solutions. But it is a fact that the “Rail-Air” scheme was realized for the first time.

- Have you already started the talks on the contract regarding this project?

- The free trade zone “Khorgos – Eastern Gates” – is a large state infrastructural project. It is aimed at the expansion of the infrastructural traffic through-put rate of the transit potential. Plus, this is a solution for the provision and expansion of the array of services that we can offer at the dry port of the free trade zone. The dry port will be used for logistical and, in the future, industrial activities. Khorgos – is a free trade zone for all projects, services and materials that will be located there. Preferential tax

- Right now we are assessing the pilot project. Then, talks will be held with our clients who are sending the cargo, and this can be any manufacturer of sensitive electronic equipment. In January-February we are planning to work out all the issues and have a clear idea of the shipment volumes and the whole technological aspect of the project.

FROM A DRY PORT TO A SEA PORT – AN ENTIRE COUNTRY IN BETWEEN - The free trade zone “Khorgos – Eastern Gates” is under the management of KTZ Express. Please tell more about its prospects.

and customs duties are envisioned. Within the Customs Union, we are seen as a good distribution center, first of all, for the countries of the customs union, and finally, for the southern destinations of consolidation and deconsolidation of cargo, as well as shipments destined for China. Here calibration, marking, dispensation can be done, any service that is required by a client. We are ready to consider all proposals, as well as help potential investors, in order to fill up this logistical and industrial zone. There is already a lot of interest, and we are working on some projects. - The state is investing a lot of money into this project, even amidst a crisis period. In the program “Nurly Zhol – path to the future” a separate provision is dedicated to the free trade zone. What is the economic and financial component underpinning the efficiency of the project? - Any infrastructural project requires significantly large long-term investments. Development of infrastructure will facilitate the expansion of our transit and transport potential, the importance of which was numerously highlighted by our Head of state. It is important to develop such projects, not despite the crisis period, but precisely because it is a time of crisis. Once it passes, we, from the point of view of infrastructure, service, safety, security, availability of information and IT-solutions, should be ready to handle new cargo and additional transit shipment volumes. By 2020, cargo

transport volumes through the territory of the Khorgos free trade zone are forecasted to reach 4.4 million tons. For example, 30% of the budget revenues of Dubai come from cargo transit. - Representative of DP World spoke very highly of the prospects of the free trade zone. If Dubai took 20 years to achieve its development, Khorgos will surpass Dubai in already 10 years. Do you think so as well? - In my personal opinion, we have a more advantageous geographic location, taking into account the current geography of trade on the continent. The shortest path between China and Europe passes through Kazakhstan. That is why we are developing the infrastructure and building new railway lines. It is also possible to look at this differently – why shorten the railway path, if with a longer line it will be possible to increase cargo turnover and increase earnings? This is a lay opinion. We have to move towards the shortening of transit paths, faster shipment of cargo, improvements in service and ensurance of the safety of cargo and keeping our clients informed. Only in this case will we have good chances to become acknowledged as a developed transit state. - Let us move from the dry port to the sea port Aktau. Representatives of DP World gave recommendations on its development. How will they be realized?

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- Around 300 recommendations were given, 88 of which are substantially imperative. The positive development dynamic of the sea port is influenced by the collaboration of the railway system and such operators as DP World. The Aktau sea port has a great future. The pre-Caspian region is developing. Overall, the plans of each country include the goal of increasing infrastructural capacities by 2020 by about 2.2 times. We should consider the expansion of the capacities of our ports and infrastructure. The decision on construction of the Kuryk port, which has a very good geographic location, was adopted with reason. There is also a need for a universal ferry line here. - Will its construction commence this year? - Construction has to be done in conjunction with the purchasing of the ferry liners. Today, there is a need for ferry on the Caspian Sea, and therefore there is the issue of their procurement, so ensure uninterrupted delivery of transit cargo. THE FLEET OF BULK CARRIERS TO EXPAND - Last year two dry-cargo ships, that were procured by KTZ Express, appeared in the Caspian Sea under Kazakhstan’s flag – “Beket ata” and “Turkestan”. How successful are their operations and will there be an expansion of the fleet? - These are Kazakhstan’s first dry-cargo ships to

appear in the Caspian. It is a great success to have been able to acquire vessels of this class, in a great condition and for a reasonable price. Dry-cargo vessels are in demand today, as they maintain a good balance with the return cargo load. Grain is transported to Iran, and construction materials are shipped from Iran. Currently, jointly with the Ministry we are working, with quiet some success, on the detailed elaboration and updating of the legal regulatory framework concerning the maritime fleet. All the regulations will be updated in accordance with the current needs. The experience with сargo vessels for us is new and has so far been quiet successful. Last year we established a new company “KTZ Express Shipping”. We are planning to expand our cargo vessels fleet. All the needs of our clients for dry-cargo transport to the Caspian will be covered. We are cooperating with other cargo ship

companies such as Khazar Shipping, on the possibility of using their ships for our clients, or vice-versa, in order to establish good service around the Caspian. - Acquisition of new cargo vessels is planned for this year. Will they be of a similar scale as “Beket ata” and “Turkestan”? - This year we are planning to acquire two vessels. Therefore, already this year we will have at least 4 vessels. We will also be placing an order with the shipbuilding yard for next year. The characteristics of the vessels should be analogous, with an increased loadcarrying capacity of up to 7 thousand tons. Postal logistics - You have mentioned a number of important logistics solutions that were realized alongside “RailAir” last year. Could you tell us about them? - One of the logistical products we successfully developed in collaboration with KazPost. Our company does export-bound shipments of ferrous alloys, from Kazakhstan through China to Korea and Japan. From the Aksu stations, ferrous alloys in KazTransService containers with various destination points, are unloaded in the port of the city of Lianyungang, where empty 20 ft containers are loaded. Our pilot project entailed the delivery of two 20 ft containers from Lianyungang to Zhengzhou. It was loaded as a postal shipment and sent by railway to Astana, where they were unloaded and with the participation of KazPost, sent to the post terminal in Moscow by automobile transport. Before, operations of such a scale were not realized. - Why was there a need to use automobile transport? - Right now we require coordinated operations of all railway lines, so that postal shipments can be transported

in containers. For now there are certain barriers. This indicates that the regulatory framework of the railway system has to be reconsidered, as well as the agreements concluded between managing operators. They need to be updated, because there are new products that could be loaded onto railway transport, including into containers. We have also developed a number of schemes on which we are working right now with a couple of cargo senders, with different routes and types of cargo. We are showing good results in connecting routes, with only 16% of them being empty leg trips. This is convenient, because it affects the overall rate and the rate for each individual cargo sender. It also shows the good work that we are doing with our partners, cargo senders, and freight forwarding companies. If we continue on the same path, the efficiency and optimal use of our wagon fleet will be very high. From the transport and logistics center to the freight train - Another task is the establishment of transport and logistics centers across the entire country. Will the first centers appear in Shymkent and Astana? - We have to build a network of transport and logistics centers (TLC). We are actively looking for investors, planning to have a minor share in these projects in order to allow businesses greater flexibility in their work with these centers. Consequently, by capitalizing and reducing our share, we will be getting a set return on our investment. Before us is the task of substantial improvement of the network of transport and logistics centers across the entire country. Currently there are TLCs, but they are mostly in strategic places, like Almaty. That is why we are not planning to build there. Regional centers are going to be shut down. We have done the research and know approximately what type of warehouses are needed, in terms of class and volume, as well as the needed terminal capacities.

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A transport and logistics center could be established in Astana. This is a promising direction. Shymkent has a great consolidation of cargo, and a large trade turnover. Trade relations in Central Asia are well established. The demography of Shymkent allows for a wider coverage of public services. We are taking into account such key details. We are also planning to develop the TLC in Pavlodar, Atyrau, Kostanai and Aktobe. In order to make sure that the terminals serve to provide clients with the service from the first to the last mile, all the arrangements will be made in this transport and logistics centers. I will tell you the backstory. All the freight trains that currently travel from China to Europe, were launched by companies that operated terminals. They began with the consolidation of goods, and then realized that it is necessary to further establish the logistics chain and the shipment of this cargo. Thus, terminal operating companies where the first to organize these freight trains. That is why TLCs, as one of the key links in the whole system of logistics, allow to consolidate and conduct logistical operations, work with smaller senders, recipients and provide them with a service. It is important not to just simply deliver the cargo to its destination, but to deliver it to the end consumer, to their store, warehouse, home. In either case, we are planning to provide this service. This is important. Today, a lot of products are loaded up into automobile transport, because it is easier to deliver something to its end destination in a car. We will also be doing this, and thus improving the quality of our services. - The cold-storage containers that you have acquired, can they be used not just for fragile equipment, but also for food products? - They can serve as cold-storage warehouses. They have electro- as well as diesel powered engines. In plain words, you can just plug it in and use it as a refrigerator on the spot. In case there is no need for transport, even though right now there is a great demand for that, any of our TLCs can be organized to function as a coldstorage warehouse. In the southern region there was a great shortage, and these type of containers will be in demand. When there are not many clients, only one container can be kept on, and the others can be turned off. There is no need to cool off the entire warehouse when there is not much cargo. If needed, this container can be loaded onto a truck or a freight railway platform, plugged in, and it will be delivered to the end consumer, whilst maintaining a set temperature regime. - …or it can be loaded onto a plane? - The container itself will not be loaded. It is an unnecessary dead load, that weighs a lot, and the plane itself has set weight requirements. But, the cargo will be delivered to the plane without any problems.

A I R P O R T S S T R I V I N G T O WA R D S INTERNATIONAL STANDARDS - The company has been entrusted with the management of regional airports. How is being realized? - A special holding company was created, LLP “Airport Management Group”, for the entrusted management of 11 national airports in Kazakhstan. Joint research was conducted with Lufthansa Consulting and an action plan was elaborated. We are cooperating with one of the world’s leading companies in the management of airport infrastructure – Zurich Airport International AG. We have plans for the integration of airports’ operations and infrastructure into the logistics system of Kazakhstan. First of all, these will be key airports. Regarding smaller airports, we are cooperating with state authorities on the possibility of receiving subsidies. With respect to renewal of infrastructure, KTZ Express, as the entrusted management, is responsible for the optimization of expenditures and improvement of operational efficiency. We conduct an analysis of the state of infrastructure, note what needs to be done in order for the airport to reach international standards. Here we have to work in tandem with the state for the renewal of the airports’ assets and optimizing their use. LIANYUNGANG – СENTER FOR TRANSIT CONSOLIDATION - An important aspect of the activity of KTZ Express is international competence. In this respect, what can you tell us about Lianyungang? - A section of the railway line from our terminal to the station has already been built in Lianyungang. Once we are given the green light for its use, which should happen very soon, we will start organizing freight trains. Right now, all the paperwork is being put in order in accordance with the requirements of China’s legislation. The potential is very high – up to 12 freight trains per month. We took into account that if there is coastal shipping, from Korea, Japan and South-East Asian countries, then we can make Lianyunang a center for consolidation of transit cargo, for China as well as Kazakhstan. Cargo will be passing through our country as transit shipment, destined towards other countries of Central Asia, Europe and CIS. We have already built up a good momentum. In half a year of operations 78 thousand TEUs have been processed, and at the terminal – 125 thousand tons of bulk cargo. The plan for this year is 250 thousand TEUs, and by 2020 – to increase it to 550 thousand TEUs at our joint terminal in the Lianyungang port, the territory of which is 21.6 hectares. We need more origin points of cargo and its consolidation. Therefore, we would like to increase

our competencies in Iran, Turkey and Europe. They represent big markets, for the sale and formation of cargo. As I said before, our participation there is necessary, so that we could control the supply chains and offer our clients the best service. REPUTATION ABOVE ALL - From the moment that your company was established, you have already done a lot. Have earned a good reputation…. - Our company is one and a half years old, and we are developing at serious tempos and working hard on offering new products. For us, the most important is expansion of the range of logistical products. In order for our clients to have more options, we will not only be competing, but also cooperating with sea shipment companies – the main cargo shippers. There is an established global system – if cargo is sent by sea and

part of it did not arrive on time to the ship and was left behind at the port, then the shipping company is required to deliver this cargo usually by autotransport, which is very costly. That is why the potential for cooperation is very high, and cargo that was left behind and arrived late, can be sent by us by railway lines. Potentially, this might entail a very high volume of cargo. The most interesting is that the cargo will be delivered to its destination faster, if its destination is Europe, than the freight ship going by sea. This is good service. The most important for us is to offer our main clients, and in the future, smaller clients, a full range of services. Our arsenal of products includes airfreight, “Rail-Air”solution, regular freight train, auto transport and sea shipment. All the prices and delivery periods will be drawn up on one table. The client can choose whatever is more suitable for them from the price list. We should not limit our clients. If they say: “I want it done in one day”, then we should already have concluded agreements with the partner airlines (or in the future, airplanes). Then we can offer the client, with full confidence, an alternative solution, that takes into consideration their preferred delivery periods. - Can you already do this today? - Yes. Today we can provide this service. We arrange regular shipments to Europe in trucks, vans, with cargo formation taking place in France at the Besançon terminal, for the consolidation of a set batch of cargo and its delivery to Kazakhstan. Our operators and colleagues supervise this process from start to finish. We are turning into a transport and logistics company.

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Kulpash KONYROVA, exclusively for “Diplomatic Herald”

Astana and Tallinn: prospects of transit potential The importance of developing Kazakhstan-Estonia cooperation, as well as revival of relations in various sectors of the economy, has been noted by many at the highest levels. According to the opinions expressed, for both Astana and Tallinn, of special relevance is the use of their transit potential. Big prospects are in the creation of competitive centers of transport and distribution at Estonian ports, for Kazakhstan’s products, that are destined for the European Union and other international markets. Kazakhstan is particularly interested in Estonia’s ports, which Tallinn is ready to provide for the transshipment of transit cargo from our country. Estonia is the most northern country in the Baltic region and has modern and well-equipped ports and terminals. Looking at concrete numbers, from the beginning of 2014 more than 1.4 million tons of Kazakhstan’s petroleum products, particularly high quality mazut, were transported through the ports of this country. There are opportunities for the transit of another product that enjoys a similar demand on world markets – grain. And grain not just from Kazakhstan, but from other countries

as well. The transshipment capacity of Estonia’s ports is almost 40 million tons. Another important aspect is that logistics costs for Kazakhstani entrepreneurs will be lower in comparison with other existing transport corridors. For example, Estonia’s experts believe that for the national company “KazMunaiGaz” it will be more cost-efficient to send their raw materials through the Sillamae port, which is an EU port that is the closest to Russia. What’s more, according to the official representatives of the port, Sillamae is ready to offer “KazMunaiGaz” an area for the construction of its own terminal. As it is known, this port is located only 25 kilometers away (the shortest distance in comparison with other Baltic countries – author’s note) from the border of the European Union and Russia. This creates all the necessary conditions for its effective use as a distribution center, for transshipment of cargo and various products destined for Europe, United States Russia, a number of CIS countries as well as South-East Asian countries. Sillamae is the most eastern deep water EU port, that can accommodate all large ships that enter the Baltic

sea through the Danish belts. The free trade zone of Sillamae in conjunction with the liberal tax policy of Estonia create a favorable business environment not only for the international distribution of cargo, but also production of goods on the territory of the free trade zone. Recently the port’s management has announced its intent to build a LNG-terminal on its territory, which today is very timely for ensuring security in European countries, and invited Kazakhstan’s oil and gas company to take part in this project. Russian and western companies have already expressed interest in this project. According to preliminary calculations, the cost of this project is within the range of 60 to 100 million euro. By the way, in 2014 Silliamae lowered the volumes of transshipment of Kazakhstan’s mazut to 1 million tons. The year before, this figure stood at 1.5 million tons. According to the port’s management, the reason behind this drop is the decision of “KazMunaiGaz” to redirect 500 thousand tons of mazut to the Batumi port on the Black sea. As it is known, the high-quality mazut that arrives at the Sillamae port from Kazakhstan is shipped to the United States and countries of the European Union. Another Tallinn port, Muuga, also offers businesses from Kazakhstan its capacities and territory for the building of a terminal. According to the latest data from 2014, the volume of Kazakhstan’s coal that is transshipped through the Muuga port may reach 200250 thousand tons. This is just a small figure, as the transshipment capacities of the port reach almost 8

million tons. By the way, in the last 8 years grain from Kazakhstan was not shipped through Muuga. In 2006 less than one million ton of grain was shipped, even though the potential capacities are estimated at 3.5 million tons. In turn, Estonia’s entrepreneurs are looking for new markets for the sale of agricultural and fish products. According to Estonia’s Minister of agriculture, IvariPadar, right now Tallinn is interested in Central Asia and Arab countries. According to Mr. Padar, because of the excellent quality of Estonian farmers’ dairy products, they were in great demand on Russia’s markets, but due to the sanctions imposed because of the standoff between the West and Russia, Estonian government is looking for alternative markets. “However, the main issue is not the sanctions against Russia, but because the Russian market is unpredictable for Estonia, like ‘a rollercoaster’, which is why it is dangerous to become dependent on it” – the Minister explained. Mr. Padar also clarified that Tallinn intends to research what kind of agricultural products would be in demand in Kazakhstan. “For example, in Arab countries meat has to comply with halal standards. And perhaps, for Kazakhstan this is also important. Therefore, we need to study the demands of your market” – stated the Minister. Also, according to Mr. Padar, Estonia’s companies have the capacities to deliver breeding cattle to Kazakhstan, for the production of meat and dairy products. The prospects of working further on these and other

issues of bilateral cooperation will be discussed during the session of the Intergovernmental commission on trade and economic cooperation between Kazakhstan and Estonia, which as it is expected, will be held in the first quarter of 2015. As it is known, the commission was established in accordance with the Agreement on economic, scientific and technological cooperation, which was signed during the visit of Estonia’s Prime Minister Andrus Ansip to Astana in 2009. In 2010, a session of the intergovernmental commission was heldin Tallinn, and a year later in Astana, during which opinions were exchanged on a wide range of issues of cooperation in fields such as transport and transit, energy, information technologies, tourism, agriculture, education, science, culture and healthcare. As a result of the meetings, protocols were signed which reflect the prospective direction of bilateral trade and economic cooperation. Within the framework of the first session of the intergovernmental commission onMarch 11, 2010, a business-seminar was organized for managers of Estonian companies and enterprises, that represented the transport and logistics, information technologies sectors, as well as the agro industrial complex. Experts from the Ministry of Industry and Trade, as well as the Customs control committee of Kazakhstan’s Ministry of Finance, took part in the seminar. On February 14, 2011, within the framework of the work of the commission, meetings of three working groups were held – on transport and logistics, energy and information technologies. The working groups were created following the decision of the first session of the Kazakhstan-Estonia Intergovernmental Commission. Further progress in the Kazakhstan-Estonia dialogue, within the format of the Intergovernmental commission, was made on November, 2013. New intersecting points of interests, which include delivery of Estonian products to Asian markets, particularly to Kazakhstan, will be discussed in greater details during another session of the Intergovernmental commission on cooperation between Kazakhstan and

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Estonia, which is planned for the first quarter of 2015. It was this, that drew the attention of a member of Estonia’s parliament, head of the Kazakhstan-Estonia working group on interparliamentary cooperation, Denis Borodich. “The next session of the intergovernmental commission between Kazakhstan and Estonia is planned for the first quarter of 2015. At least there is a desire to discuss and expand the possibilities of our cooperation. For us, it would be preferable to conduct a business forum within the framework of the intergovernmental commission, so that Estonia’s entrepreneurs would have an opportunity to come to Kazakhstan, and set new directions for cooperation” – Mr. Borodich noted. Denis Borodich also listed a number of prospective directions of cooperation for Kazakhstan and Estonia. “The first is the development of transit and logistics. As it is known, Estonia is a transit-logistics center in the Baltic regions, and Kazakhstan – in the Central Asian region. Products from China, that are destined for Europe, pass through you, and back from Europe to China. What’s more, your exports include hydrocarbons, ore minerals, grain” – said the parliamentarian. He also reminded that Estonia possesses modern and well-equipped ports and terminals on the Baltic sea. “We have five ports and we are proud of each one of them. By the way, annually around one and a half million of Kazakhstan’s petroleum products are already being transshipped for export through the Sillamae sea port” – Mr. Borodich informed. According to Estonia’s parliamentarian, “green technologies” and development of renewable energy sources may become the second prospective direction for cooperation. Local generation of electric power from schist and biofuel is well established in Estonia. The country is generating more electric energy than it uses, and therefore part of it is exported its neighboring countries – Finland and Latvia. Besides, utilization of windmills is well established. And, we would be interested in participating in EXPO. We know that Kazakhstan is doing a road-show in the countries that will participate

in the upcoming exhibition and we would be interested in learning about the possibilities of our participation in this grand event.” – said Denis Borodich. The third prospective direction of developing bilateral cooperation is agriculture. “Today, the Ministry of Agriculture of Estonia is looking at Asian markets, such as Taiwan, China, Kazakhstan…”, - added Mr. Borodich. According to Mr. Borodich, there are hopes for the revival of exports of breeding cattle to Kazakhstan. “We are devoting a lot of attention to selection. We have bred cattle breeds that give up to 12 thousand liters of milk per year. In comparison, in other countries, in Belarus, this figure is only 9-10 thousand liters per year”, - he noted. The fourth direction of cooperation is the “transfer

of information technologies”. Today, more than 500 types of services in Estonia are provided through the internet: from payments for utilities, banking operations and visits to medical centers, to parking reservations for cars and online voting. And finally, the fifth promising direction is tourism. According to Mr. Borodich, when visiting Estonia it is possible to “kill three birds with one stone” – to visit Tallinn, Helsinki and Stockholm. It is possible to do this because of the ferry connection between Estonia, Finland and Sweden. Passenger ferries run almost every half an hour and right on the clock. “Therefore, this voyage would be of great interest to people from Kazakhstan, who expand the geography of their holiday travels every year”, summarized Mr. Borodich.

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Magtymguly AKMURADOV, Extraordinary and Plenipotentiary Ambassador of Turkmenistan to Kazakhstan

Kazakhstan and Turkmenistan increase cargo transit after the opening of the Uzen-Bereket line Today, development of infrastructure is one of the determinant factors of geopolitics, a powerful integration resource that can lead to substantial economic and political benefits to states and regions and open up new prospects for transcontinental cooperation. In connection with this, the advantageous location of Turkmenistan allows our country to initiate large-scale international and regional projects that can lay the foundation of the architecture of the new geo-economic space on the Eurasian continent. In its own way, Turkmenistan is an economic bridge between Asia and Europe. The key aspect of the transport strategy of our country is diversification – formation of an international infrastructure with multiple options. In this context, we are for the creation of new transport, transit and trade corridors along the routes “East-West” and “North-South”, that allow for the integration of national transport systems into the global international communication network. Important attention is

paid to the realization of initiatives of the President of Turkmenistan, Gurbanguly Berdimuhamedow, regarding the construction of efficient transit lines between the Caspian, Black and Baltic Seas. In addition, work is being done on the establishment of a transport network that connects regions of Central, South and South-East Asia with the Near East and Mediterranean Sea region. In practice, these ideas are being realizedthrough the construction of new railway and highway lines and activation of the use of sea routes. An example of this is the railway line Kazakhstan-Turkmenistan-Iran. The initiative of the President of Turkmenistan, regarding the realization of this project in October 2007, was supported by the Presidents of Kazakhstan and Iran. On December of that year a tripartite intergovernmental Agreement was signed in Turkmenistan on the construction of the railway line Uzen (Kazakhstan) – Kyzylkaya – Bereket – Etrek (Turkmenistan) – Gorgan

(Iran). It will allow to connect the states located in the North, West and East of Eurasia, with the southern regions of the continent through shorter and more economically efficient routes. The overall distance of the railway line KazakhstanTurkmenista-Iran is 934.5 kilometers. This means that cargo can be delivered from the starting point of this route to the final destination in less than a day. The longest part of this railway line – 722.5 kilometers – passes through our country. Along the territory of Kazakhstan 130 kilometers of the railway line pass, and across the territory of Iran – 82 kilometers. Construction companies from Turkmenistan worked in two directions. The first – “Bereket – Kyzylkaya – Turkmenistan-Kazakhstan border”. The distance of this line is 466 kilometers. The second direction – “Bereket – Etrek – Turkmenistan – Iran state border”. This branch of the railway line is 256.5 kilometers. Its construction also entails the building of a locomotive transfer depot in Etrek, a technical service center, as well as a base complex for changing wagons in the pre-border zone. In 2013 the Kazakhstan section and the Turkmenistan sections of the Ozen-Bereket line were linked through the Bolashak station. Already at this stage of construction of the railway line the economic efficiency of this project can be seen. From the beginning of the year (January-July) the volume of cargo transported between Kazakhstan and Turkmenistan amounted to

1.4 million tons, which is a 42% increase in comparison with the same period of last year. More than half of this cargo volume was transported along the Uzen-Bereket section. By the end of this year there are plans to open the railway corridor Kazakhstan-Turkmenistan-Iran. According to our forecasts, by 2020 the volume of cargo transported along the new route may reach 15 million

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tons, including 3 million tons of transit shipments. Along with the railway project, by the initiative of the President of Turkmenistan, another transborder highway line of the transit corridor Uzbekistan-TurkmenistanIran-Oman is being built. At the foundation of this project is the four-party intergovernmental Agreement on the creation of a transport corridor â&#x20AC;&#x153;Central AsiaNear Eastâ&#x20AC;?, which was signed in Ashkhabad in April 2011.

At the same time, Turkmenistan has commenced the construction of a new railway line TurkmenistanAfghanistan-Tajikistan, which will be the connecting link between the Central Asian region and South Asia. The abovementioned transport corridors and other projects of the transport and communications sector will allow to significantly expand the market of transport services in the near future, and open up new opportunities for trade and economic cooperation between the largest states of the Eurasian continent. During the International Ministerial level conference, which was held in the capital of Turkmenistan on 3-4 September of this year, more than 30 countries discussed the details of strategic collaboration in the sphere of transport infrastructure development. As a result of this conference the Ashkhabad declaration was adopted, which reflects all the common principles and approaches of further joint work in the transport sector of the economy. Therefore, I would like to note that in the future Turkmenistan intends to conduct an active transport policy, aimed at the solution of global tasks facing the international community in the context of ensuring sustainable development.

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Foreign diplomats assessed the prospects FEZ “Khorgos-Eastern Gate” This autumn heads of diplomatic corps, accredited in Kazakhstan, visited the facilities of SEZ “Khorgos – Eastern Gate”, Altynkol station, Kazakh-Chinese International Centre of Boundary Cooperation (ICBC.) Site visits were held with the participation of Minister of Foreign Affairs of the Republic of Kazakhstan Erlan Idrissov and management of JSC “NC Kazakhstan Temir Zholy.” SEZ “Khorgos – Eastern Gate” is one of the objects of the program of the New Economic Policy Nurly Zhol, implemented by JSC “NC “KTZ.” President Nursultan Nazarbayev stressed that “the core of the new economic policy of Kazakhstan is the development of infrastructure. Realization of projects within Nurly Zhol is aimed, first of all, at providing infrastructural basis for economic growth.” In technological coordination with the railway lines Zhetigen – Korgas and Zhezkazgan – Beineu, automobile corridor Western Europe – Western China and Aktau port, SEZ “Khorgos – Eastern Gate” is a vital center of consolidation and distribution of cargo flow on the New Silk Road that provides for further integration of Kazakhstan into the world transport and trade systems. The favorable geographical location of SEZ “Khorgos – Eastern Gate” on the crossing of important routes from China and Southeast Asia to the CIS countries, and also to Europe, the Persian Gulf and other regions, conditions for the development of multimodal logistics, organization of large industrial productions

and trade, make it a world-class perspective distribution center. Addressing representatives of diplomatic corps, the Foreign Minister emphasized the timeliness of launching such a modern and large-scale hub in the context of realization of the strategy of the country infrastructure development Nurly Zhol, the recent ratification by the President of Kazakhstan Nursultan Nazarbayev of the protocol on accession of Kazakhstan to the World Trade Organization and development of the transit and transport capacity of Kazakhstan. As Idrissov noted, Kazakhstan’s EAEU and WTO membership clearly reflects our commitment to economic integration and our traditional openness to mutually beneficial cooperation with the widest range of partners. The launch of ICBC “Khorgos” and SEZ “Khorgos — Eastern Gate” creates a new window of opportunities for the further expansion of trade and investment cooperation, acceleration of transportations in the vast area between China, Europe, the CIS countries and the Middle East, Idrissov underlined, having urged foreign diplomats to inform the capital cities and business communities in their countries about all advantages of cooperation with Kazakhstan in this area. Idrissov drew attention of foreign ambassadors and foreign journalists to the fact that some international observers talk about revival of the new “Great Game” in the region, especially in the context of implementation of the New Silk Road projects. “These comparisons

are conservative and have nothing in common with the modern Kazakhstan and our vision of the situation,” – he said. “Kazakhstan has been supporting and continues to support the transformation of the “Great Game” philosophy into the “Great Gain” for all philosophy. We are convinced that the development of trade and transport communications in the region has enough space to satisfy interests and bring benefits to all – to Russia, China, the countries of the West, and, of course, to Kazakhstan.” In turn, the Vice-president of JSC “NC “Kazakhstan Temir Zholy” Kanat Alpysbayev emphasized that “being in the center of Eurasia, Kazakhstan pays special attention to development of transit potential. Today, in order to increase transport and transit potential of overland corridors of Kazakhstan and China, the railway and logistic infrastructure is established on the border which ensures transportation of over 40 million tons.” K. Alpysbayev pointed out: “JSC “NC “KTZ” is ready to provide a full range of transport and logistics services, including the operation of regular trains. Just over the past 5 years transits on the China-Europe route have increased 17-fold.” According to the Vice-president of JSC “NC “KTZ”, one of the most promising logistics solutions for partners is multimodal transportation across Kazakhstan based on the scheme Rail Air. This scheme enables the movements of container trains by railway from China to Kazakhstan with further air transportation from Kazakhstan to Europe. During the visit a Forum was held within which Director General of LLP “KTZ – Khorgos Gateway” Karl Gheysen gave a presentation:“Implementation of the project Dry port “KTZ – Khorgos Gateway” in cooperation with the world’s largest logistics operator Dubai Port World.” He reported that Khorgos Gateway is the first land port in Kazakhstan and also the largest logistics park in Central Asia. High performance and perfect handling capabilities of the Dry port offer efficient, cost-effective transportation of goods across the New Silk Road.” Dry port “KTZ – Khorgos Gateway” has been operating for two months and has already processed more than 10 thousand of TEU, piece production is being actively processed. Transportation by motor transport from the EU to China and from China to the markets of the Eurasian continent is being organized. Staff with the involvement of local personnel trained in the leading transport and logistics centers (TLC) of the world is being formed. So far, agreements have been signed with Hewlett Packard, DBS Chenker, Toyota, FESCO, BRAVIS on the formation of container trains by transit through the station Altynkol, and processing in the SEZ “Khorgos - Eastern Gate.” In the Khorgos International center of boundary cooperation (ICBC) President of JSC “KTZ Express” Sanzhar Yelyubayev told diplomats about the uniqueness of the Kazakh-Chinese project. He said

that “the main purpose of ICBC Khorgos is to develop border trade and economic cooperation and international tourism on the Great Silk Road. The establishment of ICBC Khorgos opens additional opportunities for expansion of international trade and development of the tourism industry with the establishment of the territory of visa free visiting for citizens of the RK and the PRC, conclusion of commercial transactions which generate great interest among business community, tourists from neighboring countries and beyond.” ICBC Khorgos has already started the implementation of 5 investment projects on formation of export-import trade operations, as well as contract logistics. Another 10 projects are under consideration. The total amount of investment projects of the first stage is 300 million dollars. Projects implemented by JSC “NC “KTZ” within the program Nurly Zhol, including the largest project of SEZ “Khorgos – Eastern Gate” give a powerful impetus to the development of the transit-transport potential of Kazakhstan and will fully contribute to the formation of the economic belt of the New Silk Road.

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Aiman TUREBEKOVA, attache, Committee for International Information

Astana begins direct flights to Paris Paris has long been one of the most-favourable travel destinations and the increasing number of tourists from Kazakhstan highlights its desirability. Convenient opportunities for travelers, such as a direct flight between Astana and the City of Lights, could further help to encourage the tourist trade. Kazakh and French transport authorities signed a protocol to launch a three-time-a-week direct service between Astana and Paris during Kazakh President Nursultan Nazarbayev’s official visit in June 2011. Despite some restrictions on Air Astana’s flights to Europe since 2009 due to the decision by the European Union air safety commission, the airline is able to increase its number of flights to Europe. A new service from Almaty to Paris via Astana began March 29 on a Boeing 757, which can carry 228 passengers and is configured with 16 business and 150 economy class seats. Moreover, passengers to and from Paris have the opportunity to choose the economy sleeper class, benefited by three seats in a separate cabin and a mattress and pillow for a comfortable trip. Carrying a full planeload of passengers, the inaugural flight left the Kazakh capital at 2 p.m. on March 29, and arrived 5:05 p.m. local time at Charles

de Gaulle Airport. More than 20,000 passengers are expected to take advantage of this direct flight by the end of the year, said Air Astana President Peter Foster. “The new service to Paris is a major step in developing Air Astana’s European network and serves to strengthen economic, diplomatic, cultural and tourism links between France and Kazakhstan,” he added in comments carried over by Air Astana and at the press conference to announce the new flight on April 1 at Astana’s Radisson Hotel. “If we take into account the fact that the development of tourism is one of the main priorities of Kazakhstan, the comfortable direct flights play a crucial role in terms of encouraging tourist attraction.” His comments were echoed by Francis Etienne, French ambassador to Kazakhstan. “The beginning of direct flights between the two capitals will improve relations and cooperation between the two nations,” he said elaborating on how this will impact not only tourism, but also cultural and educational ties. “Sixty-five million people in France and 17 million people in Kazakhstan are the millions of reasons for this flight,” he said at the press conference with Foster.

Travel has also been aided by the decision of the Kazakh government to provide a visa-free regime from July 15, 2014 to July 15, 2015. Citizens of the United States, the Netherlands, Great Britain, France, Germany, Italy, Malaysia, the United Arab Emirates, the Republic of Korea and Japan and holders of valid diplomatic, official and national passports can repeatedly enter, exit and fly through Kazakh territory without visas up to 15 calendar days after crossing the state border. As a result, French tourists can easily go to Kazakhstan using the direct flight. In addition, Air Astana is planning to open new international routes this summer from Astana to Seoul and Tbilisi. The direct connection between the capitals of Georgia and Kazakhstan will begin operating June 2 and a month later the airline will link the Kazakh capital with its Korean counterpart. Air Astana celebrated triple success at the 2014 World Airline Awards held at the Farnborough International Airshow, where the company was named the Best Airline in Central Asia and India for the third consecutive time and received the award for Best Staff Service in Central Asia and India for the second consecutive time. Since 2012, Air Astana has been rated as a Four Star carrier by Skytrax, the only airline in Eastern Europe and the Commonwealth of Independent States to achieve this honour.

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EDITORIAL BOARD Erlan Idrissov – Minister of Foreign Affairs of the Republic of Kazakhstan, Chair of the Editorial Board of “Diplomatic Herald” magazine Dauren Abayev – Adviser to the President - Press Secretary to the President of the Republic of Kazakhstan Kairat Abdrakhmanov – Permanent Representative of Kazakhstan to the United Nations Ikram Adyrbekov – Chair of the Committee for Foreign Affairs, Defense and Security of the Senate of the Parliament of the Republic of Kazakhstan, Doctor of Economic Sciences Maulen Ashimbayev – Chair of the Committee for Foreign Affairs, Defense and Security of the Mazhilis of the Parliament of the Republic of Kazakhstan, Candidate of Political Sciences Roman Vassilenko – Chairman Committee for international Information Nurlan Ermekbayev – Assistant to the President - Secretary of the Security Council of the Republic of Kazakhstan Rapil Zhoshybayev – The First Deputy Minister of Foreign Affairs of the Republic of Kazakhstan, Commissioner of the International Specialized Exhibition “EXPO 2017”, Doctor of Economic Sciences Kairat Sarybay – Ambassador Extraordinary and Plenipotentiary of the Republic of Kazakhstan to the Republic of Austria, Permanent Representative of the Republic of Kazakhstan in the international organizations in Vienna Zhanseit Tuimebayev – Ambassador Extraordinary and Plenipotentiary of the Republic of Kazakhstan to the Turkish Republic and Albania with concurrent accreditation, Doctor of Philology Кairat Umarov – Ambassador Extraordinary and Plenipotentiary of the Republic of Kazakhstan to the United States of America, Candidate of Нistorical Sciences Ilyas Omarov – Chief Editor of “Diplomatic Herald” magazine

Photo of the day President Nursultan Nazarbayev has met the international space crew, with Kazakh cosmonaut Aydin Aimbetov.