The New Asia-Europe Land Bridge— Current Situation and Future Prospects Xu Shu

Features International Cooperation (part 2)

In September 1990, China’s Bei-jiang Middle East. The line is benefitting the Concept of Line linking Urumqi and Alashankou was development of the regions it serves. New Asia-Europe Land Bridge connected to Kazakstan Railways, At an ASEAN conference in Bangkok in thereby linking Lianyungang and other March 1996, attended by European lead- Regional cooperation and development ports in east China directly by rail with ers, it was stated that Europe and Asia is an important trend in current world Rotterdam, Holland and other European should make a concerted effort to catch affairs. The new economic zone spans ports (Fig. 1). Freight and passenger ser- the favourable tide and redouble their the central land mass of Eurasia from the vices were inaugurated on 1 December efforts to meet the 21st century with new west Pacific coast to the east Atlantic 1992. This New Asia-Europe Land Bridge amicable relations. The meeting called coast. The 10,900-km link is a hugely spans two continents, a link made pos- for increased dialogue, a deepening of important international route uniting over sible by the work of the Chinese govern- economic ties, and increased coopera- forty nations covering 39.7 million km2 ment and ministries, and commercial tion in light of common aspirations and or 26.6% of the world’s land area. The business enterprises. needs. In 1996, the New Asia-Europe population of this area is 2.2 billion, or The completion of the New Land Bridge Land Bridge Railway Regional Economic 36% of the total. not only contributes to the economy of Development Group held an interna- The New Land Bridge has a number of northwest China, it also invigorates the tional conference in Beijing and pointed outstanding and unique characteristics. national economy and contributes to the to the favourable start of an international It runs from the major economic centres nation’s Open Door policy. In addition, economic zone spanning two great con- of Europe to the major economic centres it makes a significant contribution to eco- tinents—Europe and Asia. of Asia, both of which are highly devel- nomic and cultural exchange between oped but lacking in space and natural the Asia-Pacific nations, Europe and the resources. These two poles are con-

Figure 1 Route of New Asia-Europe Land Bridge and Trans-Siberian Railway

Rotterdam Gdansk Riga Kirov Berlin Brest Skovorodino Warsaw Moscow Sverdlovsk Krasnoyarsk Budapest Tatarsk Chita Bryansk Kujbysev Omsk Novosibirsk Zabajkalsk Irkutsk Manzhouli Nakhodka Aqmola Ulan Bator Vladivostok (Tselinograd) Aktogai Dzamin Uud Erenhot Sol-lletsk Alashankou Beijing Tianjin Urumqi Lianyungang New Asia-Europe Land Bridge Arys Shanghai Trans-Siberian Railway Lanzhou Alashankou traffic catchment area Erenhot traffic catchment area Manzhouli traffic catchment area

30 Japan Railway & Transport Review • December 1997 Copyright © 1997 EJRCF. All rights reserved. nected by an extremely long and narrow Mongolia and other areas. The total popu- Meeting, development of the Railway corridor crossing the belly of the Eurasian lation of this region is 400 million or 30% was included as a top priority in China heartland. of China’s total. It encompasses 3.6 mil- in the 21st Century—A White Paper on With the exception of a few countries, lion km2 or 37% of the national territory. China’s population, environment and the intermediate nations and regions be- This area occupies a very important po- development in the 21st century. tween these two poles are undeveloped. sition in China’s social and economic In 1995, the Chinese government pro- These regions are characterized by trans- development. Remote sensing by satel- mulgated a policy designed to develop portation shortages and a severe natural lites, surveys and aerial prospecting along the zone crossed by Railway reflecting environment, but there is abundant space a swathe of land 100 km wide on both the fact that the Chinese part of the Rail- and resources. Development of these sides of line shows an incredibly rich ter- way has the necessary pre-requisites for regions and their natural resources would ritory with energy resources, ores and future development. Clearly a railway greatly benefit the local people and the minerals. The coal reserves along the line crossing China from east to west, will world as a whole. For example, the re- Railway represent 63.2% of China’s to- promote development of both regions gional coal reserves are estimated to ex- tal estimated reserves. Oil reserves com- and due priority should be assigned to ceed 2000 billion tonnes. Oil reserves prise nearly 40% of the national total, gas opening it up as an international rail cor- are estimated at 150 billion tons, and reserves form fully 50% of all China’s ridor. It is also hoped that the Railway natural gas at 750 billion cubic feet—no known reserves. Metal reserves include will become an international business wonder this region is called ‘the world’s vast amounts of gold (40%), nickel venture, marked by open-style develop- energy supply.’ For this reason alone, the (76.9%), bauxite (60.3%), and copper ment along the corridor. New Land Bridge is extremely important (30%). Chemical products and construc- just in economic terms. tion materials stand at roughly 40%–70% Current Status of Over the span of history, Eurasia has been of the nation’s total. The agricultural rim Transportation on Railway blessed with a long and fruitful tradition around the Railway is also extremely fer- of economic and cultural exchange and tile, level and broad; soils are rich, sun- Completion of the Railway greatly cooperation. The conceptual basis for shine and water are plentiful. The annual strengthened China’s freight links with the New Land Bridge can be found in the amount of underground water that can Central and West Asia and Europe, fa- historic Silk Road, which connected the be tapped in northwest China totals 112.4 cilitating diversified transport and accel- great civilizations of Europe and Asia over billion m3. More importantly, the water erated economic development of all 2000 years ago. The economic and cul- quality is high and the quantity is stable. countries along the Railway. The Rail- tural development and international co- If one takes a frank and honest look at way is highly appreciated and vigorously operation along the route of the Silk the part of mainland China crossed by promoted by the governments, busi- Road, played a vital role in the classic the Railway, the economic and man- nesses, education, and media of all civilizations of mankind. It also left a power resources are still backward and related countries, including China. How- lasting legacy influencing the arts and limited, largely for historic reasons. The ever, in terms of actual freight movement, culture of pre-modern and contemporary production structure is not rational, thus it is far from reaching its potential despite civilizations. Even today, the Silk Road limiting China’s overall economic devel- a steady increase in usage, and needs is an important spiritual link between opment. Consequently, speedy opening more development. In 1993 and 1994 Europe and Asia. Consequently, the New up and development of this region is a combined, the line carried only 111 TEU Asia-Europe Land Bridge Railway is serious priority of the Chinese govern- (standard 20-foot containers); 1995 saw sometimes called ‘The Modern Silk ment, which is devising careful policies 257 TEU, and the total increased to Road.’ In the future, the Railway will play appropriate to the region. 12,000 TEU in 1996. Most of these con- an important role in expanding economic After international traffic started moving tainer shipments were headed to and cultural exchange, and will promote over the rails, it was decided in 1993 to Uzbekistan and Kazakhstan but there was further development in Europe and Asia. lay more track to open up and develop virtually no east-bound freight. The vol- Within China, the Railway covers 4131 the region. By 1994, the Railway had ume of freight carried by other routes km passing through Jiangsu, Shandong, become a top development priority between Europe and Asia is huge, so why Anhui, Henan, Shanxi, Shaanxi, Gansu, project within the guidelines of the 1991 is so little transported along the Railway? Ningxia, Qinghai, Xinjiang, and influenc- United Nations Environment and Devel- Research into this question has high- ing nearby Hubei, Sichuan, Inner opment Meeting. To accord with this lighted the following problems:

Monument at Lianyungang reading ‘The Eastern Terminal of the New Eurasia Passenger and freight trains passing on Trans-Siberian Railway (a major Continental Railway’ (M. Saito) competitor of the New Asia-Europe Land Bridge) at Irkutsk (TASS)

Different land and sea freight 10,900 km. In other words, the Railway ing to China’s Ministry of Foreign Trade, tariffs is about half the distance of the sea route. three problems are restricting develop- The Chinese section of the Railway from Furthermore, trains are faster than ships. ment of the Railway. Lianyungang to Alashankou covers 4131 Consequently, the land route should rep- • Alashankou has inadequate facilities; km. Rail freight costs calculated at Chi- resent a huge saving in time, but it doesn’t transfer capacity and storage are lim- nese rates total about US$850 per TEU. work out that way. Currently, the speed ited. In early 1996, over 4000 rail car- Miscellaneous fees, port fees, handling of rail freight in China is very slow, and riages were backed up in Kazakhstan fees, etc., total another US$1100. Add- the journey time from Lianyungang to alone. ing the freight costs in the other countries Alashankou is about 18 days. Since the • Alashankou inspections and formalities and the additional costs for transfers, etc., break up of the old USSR, the Railway are unduly bureaucratic, creating a situ- brings the final total to transport 1 TEU route must traverse several new coun- ation where goods are held for far too from a port on the east coast of China to a tries, which imposes time and cost pen- long and sometimes for up to 6 days. European port to US$3500. Shipping by alties dealing with customs procedures, • Various fees charged at Alashankou are sea from a Chinese port to a European port etc. In fact, non-containerized freight extremely taxing, running up to for a similar-size container totals about from Lianyungang to Rotterdam takes a US$600. US$1200 and prices by sea are falling due little more than 40 days, but container- to severe competition. Consequently, the ized freight still takes more than 30 days. Poor freight tracking Railway route costs about three times as Although the distance by sea is twice as In 1991, the Chinese government allo- much as the sea route. long, the size of ships coupled with speed cated US$400,000 to install freight move- increases and navigation improvements ment tracking equipment at all main Land freight takes too long has cut the journey time to 25 days. stations along the Lianyungang- Previously, it was thought that the Rail- Alashankou route, but the system is still way would be faster and cheaper than Poor infrastructure and complex not in use and the freight owners cannot the sea route between the Asian-Pacific paperwork track movement of goods in a timely fash- region and Europe. From a geographi- The Railway freight requires two total ion. Furthermore, there is no guarantee cal point of view, the journey by sea from transfers and repackings: once at the that goods will be dispatched on time. Lianyungang to Rotterdam is about China–Kazakhstan border, and then again Owners and shippers have reacted 19,900 km, whereas the land route is on the Polish–Belarus border. Accord- strongly to these problems.

32 Japan Railway & Transport Review • December 1997 Copyright © 1997 EJRCF. All rights reserved. Fierce competition lish a unified management organization proached in the spirit of ‘preserving com- from Trans-Siberian Railway responsible for integrating the various mon points and respecting differences’. elements including planning and project Research and study of the problems must The Trans-Siberian Railway is the main implementation, problem solving, unified be strengthened. It is imperative to im- land competitor to the New Asia-Europe dispatching, customs inspection, man- prove cooperation with the Trans-Sibe- Land Bridge Railway. It has the advan- agement, and arbitration. rian and Trans-Asian railways, as well as tage of running almost entirely within The second step: An international system to develop market style economics to Russia, whereas the New Asia-Europe should be established for settling ac- promote cooperation between China and Land Bridge Railway has only a small sec- counts, and there should be unified the CIS. A project of this scope also re- tion running through Russia. Since more schemes for raising and spending capi- quires all parties to get in step with inter- freight travelling on the New Asia-Europe tal. Both line infrastructure and rolling national practices. All of the above are Land Bridge Railway will cause great stock technology must be unified to solve essential tasks to be tackled immediately. losses for the Trans-Siberian Railway, it is current problems of insufficient capac- In summary, the major tasks facing us no surprise that Russia is negative about ity. now are as follows: this. The Russian government has made Based on these changes, there should be (1) Establish a permanent international it clear that because it has allocated the new track construction involving the research institute for regional eco- best manpower, supplies, and finances to Commonwealth of Independent States nomic development along the New the Trans-Siberian, its priority is on the (CIS) in order to unify the rail gauge and Asia-Europe Land Bridge Railway, Trans-Siberian, and it views the New Asia- facilitate two-way through traffic. (2) Establish a New Asia-Europe Land Europe Land Bridge Railway more as a The third step: A high-speed train service Bridge Railway Forum, future project. To compete with the New should be planned. (3) Establish acceptable management Asia-Europe Land Bridge Railway, Russia Unification of services and management practices using an international trans- lowered the Trans-Siberian fees to on the Railway involves complex con- port group to integrate the organiza- US$0.15 per km. Conversely, to constrain struction reaching into the next century; tional structure, and development of the New Asia-Europe it is an important project with long-term (4) Establish an international system for Land Bridge Railway, the fees for the Rus- benefits, but faces some problems. First, funding the Railway management and sian section have been raised to US$0.30 the different political, economic and infrastructure. I per km. Furthermore, the Trans-Siberian idealogical systems of the various coun- has one less track transfer due to the uni- tries along the line pose a daunting chal- form gauge, which simplifies shipments lenge. Second, there is the problem of along the line. competition with the Trans-Siberian Rail- way and the new Trans-Asian Railway (JRTR 12, pp. 31–35). Third, there is the Future Development Measures problem of coordinating management and international business practices be- To develop the Railway into a truly inter- tween China and the CIS. national traffic corridor between Asia and Therefore, making the Railway a success Europe, it is necessary to fully integrate requires changing opinions and solving the system to make it more convenient, political, economic and ideological dif- speedy and safe. It will serve as a bridge ferences. The project must be ap- between the governments of each coun- try along the route and increase links Xu Shu between relevant railway authorities, customs inspections, etc. The scope of Mr Xu Shu is a lecturer at the School of International Economy and Management at Shanghai the work is broad, and the easy problems Tiedao University. His major publications include the Theory of Transportation Pricing and the Assignment of Passenger Transportation Charges. should be tackled first before moving on to the harder ones. Step-by-step planning must put into effect. The first step: The Railway must estab-