The heads of railways from Russia, Belarus, and Kazakhstan signed a schedule of activities to create the UTLC

Posted: 7 November 2013 | | No comments yet

“The schedule determines the sequence of decisions…”

Russian Railways logo

On November 7 in Astana, heads of the Russian, Belarusian, and Kazakh railways signed a schedule of activities to create the United Transport and Logistics Company (UTLC).

This document was signed by President of Russian Railways Vladimir Yakunin, First Deputy Head of Belarusian Railways Vladimir Mikhailyuk, and President of NC Kazakhstan Temir Zholy Askar Mamin.

“The schedule determines the sequence of decisions at both railway and governmental levels, which can, upon completing all legal aspects, begin operations of the UTLC in the first quarter of 2014.” Mr. Yakunin told reporters at the signing ceremony.

Recall that the framework agreement for the establishment of the UTLC was signed in June 2013 at the St. Petersburg International Economic Forum in the presence of heads of state of Russia, Kazakhstan, and Belarus.

In October, the parties signed an agreement (a so-called term-sheet) on the basic principles of establishing and operating the UTLC, on the basis of which a shareholders’ agreement will be prepared. At the moment, a joint team of employees from the three railways, JSC TransContainer, and JSC RZD-Logistics led by Zhanar Rymzhanova, an advisor to the president of Russian Railways, has been formed.

Also, an agreement in principle on the transition to a single flat rate for container per kilometer in transit for the China-Europe-China route has been reached. This is due to the interest shown by the Chongqing province of China in the immediate use of rail transit through the territory of Russia, Belarus, and Kazakhstan to transport Chinese goods to Europe and importing European goods in China.

The project will bring significant financial benefits for shareholders and for the states of the Common Economic Space (CES). According to the business plan, the total turnover of UTLC in 2020 will exceed 4 million TEUs. Additional income from the national railway companies using the infrastructure by 2020 will be about $1.6 billion. The cumulative contribution to GDP of the CES in 2020, according to estimates, will reach $11.3 billion, including almost $5 billion for Russia, $5.3 billion for Kazakhstan, and about $1 billion for Belarus.