Khorgos Opens Up New Opportunity for Eurasia

On Oct.19, the heads of the diplomatic corps, accredited in Kazakhstan, visited the facilities of SEZ “Khorgos - Eastern Gate", Altynkol station and the Kazakh-Chinese International Center for Cross-Border Cooperation.

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During a day trip, guests, including representatives from local and foreign media, were familiarized with the main objects of the new transport and logistics hub, established on the basis of international agreements between Kazakhstan and China, as well as conditions of its operation and cooperation with international partners.

Speaking at a press briefing in Khorgos, the Foreign Minister Erlan Idrissov stressed the timeliness of launching such a large-scale and modern hub in the context of the recent ratification of the Protocol of Kazakhstan's accession to the World Trade Organization and the implementation of the strategy of infrastructure development of the country "Nurly Zhol".

“Our own Nurly Zhol economic reform programme to build industrial capacity, develop infrastructure – particularly new transport and communication routes – and diversify from the energy sector clearly marks out our own determination to continue to lead modernization in our region. And this opens up investment opportunities for East and West”, he explained.

“In addition to WTO, Kazakhstan is also part of the Eurasian Economic Union. Last week we also hosted a summit of its leaders in Burabai (Borovoye). As we have free trade inside the EAEU, easier and faster trade through Khorgos creates another wide window of opportunities for our member states’ cooperation with China. We see this as a positive sign and change”, emphasised Idrissov.

Khorgos is viewed as a key transit hub carrying cargo between China and Europe under China's New Silk Road strategy, which aims to rebuild trade links across Eurasia and the Indian Ocean. Linking together the railway lines Zhetygen - Khorgos and Jezkazgan - Beineu, road corridor Western Europe - Western China and Aktau port, SEZ "Khorgos-Eastern Gate" is an important center for the consolidation and distribution of cargo flows on the New Silk Road, and provides further integration of Kazakhstan into the world transport and trade system.

“We read some analyses that talk about the new Great Game in Central Asia, also in context of the new Silk Road projects like this one”, said the Foreign Minister. He also added that “the strengthening of our role as a bridge between Asia and Europe is in our raw economic interest and initiatives such as the Silk Road Economic Belt will create a wealth of opportunities in the region and beyond”.

Government of Kazakhstan has established Khorgos Special Economic Zones and all with a different targeted focus, as vehicles for increased investment, economic development and commerce. Special legal regimes are also offered to those companies whose activities foster fast development of high-productivity and competitive industries, promote investments and transfer of new technologies, and increasing employment opportunities.

JSC “NC” Kazakhstan Temir Zholy (KTZ), 2011 the state railways operator, took control of Khorgos in mid 2011, since then numerous international agreements have been signed as well as tremendous interests of prospective partners of the programme have been observed.

Speaking at the meeting, Vice President of KTZ Kanat Alpysbaev stressed that "being in the center of Eurasia, Kazakhstan pays special attention to the development of transit potential. Today, in order to enhance transport and transit potential of land corridors of Kazakhstan and China established railway and logistics infrastructure at the border, which allows transport in excess of 40 million tons”.

He also added that “KTZ is ready to provide a full range of transportation and logistics services, including the handling of regular trains. Only in the last five years the volume of transit along the route China-Europe has grown by 17 times.

According to Vice President of KTZ, one of the most promising solutions for the logistics partners is based on multimodal transportation scheme «RailAir» in Kazakhstan. This scheme provides transportation of container trains on the railway from China to Kazakhstan with further air transportation from Kazakhstan to Europe.

On the same day, the Director General of LLP «KTZ- KhorgosGateway» Karl Geisen gave a presentation on the topic "Implementation of the project Dry port «KTZ- KhorgosGateway» in collaboration with the world's largest logistics operator «DubaiPortWorld».

“Dry Port SEZ “Khorgos - Eastern Gate", using the modern logistics technology under the standards of the largest port operator DP World, will be an effective solution for transportation of export and import goods”, the company operator emphasised.

According to Sanzhar Elubayev, President of JSC «KTZExpress», the Khorgos project opens up additional opportunities for expansion of international trade and the development of the tourism industry with the formation of the territory of the visa-free regime, attracting business community, tourists from near and far abroad.

Five investment projects to build export-import trade operations has been launched and 10 more projects are under consideration in the frame of this program. The total volume of investment projects in the first phase is US$ 300 million.

For example, Jiangsu province last month signed an agreement to invest US$600 million over next five years in the Khorgos Eastern Gate special economic zone, which houses the dry port. Darryl Hadaway, chief executive of Silk Route Rail, a start-up company focusing on the train business in Kazakhstan, said more and more mega brands such as DHL and HP are opting for the China-Europe rail network, which transits through Khorgos.

As the Kazakh Foreign Minister highlighted in his speech “Asymmetric language makes a neat headline but it ignores the reality: a hard-headed and mutually beneficial partnership involving Kazakhstan, Russia, China and others which is creating the jobs and investment Kazakhstan needs”, it is difficult to disagree with the statement of  Idrissov addressing the heads of diplomatic corps that Khorgos would be an important element in the country’s efforts to make Kazakhstan an even more open economy and country, bringing closer China, Russia, Europe, the Middle East, Central Asia, the Caucasus, South Asia.