International conference "FREIGHT-2005: Far East"
On April 15, 2005 SeaNews Information & Consulting held the International Conference "FREIGHT-2005: Far East" in Vladivostok. This was the first transport-related event on such a scale in the Russian Far East over the last years. The Conference was supported by the Primorie Kray Administration, the RF Federal Agency of Maritime and Inland Water Transport and the RF Federal Customs Service. The Conference was officially sponsored by Vladivostok Commercial Sea Port JSC, and Cargo Terminal Pulkovo acted as a sponsor of delivery. The Conference's general media sponsor was the "RZD-Partner" magazine and the publishing house "Zolotoy Rog". Transport infrastructure development in the Russian Far East requires a balanced approach minding the interests of the state. Nowadays short-sighted narrow departmental interests often dominate over the strategic economic interests of the state. Meanwhile we miss the opportunity for rise and development bringing to naught the results of many years. To develop the transport sector of the Far East it is necessary to build highways and pipelines, develop the port rail stations and renovate and expand the Russian Railways' rolling stock. The insufficient fitting platforms supply to Vostochny International Container Services in February-March 2005 significantly reduced the transit traffic via the terminal, told VICS MG Michael Frydrych the delegated of the International Conference "FREIGHT-2005: Far East". According M.Frydrych, the Russian Railways decline to supply empty platforms to the terminal, suggesting that VICS should load import and transit containers onto the platforms that come with export boxes. The problem is the trade imbalance as import exceeds export by 30%. As a result, there are not enough platforms, which leads to delays in the dispatch of import and transit containers from the terminal and, concequently, reduces the attraction of the TransSiberian Railway for customers from Japan and Korea. The Vladivostok Container Terminal doesn't receive any fitting platforms at all and has to load containers onto gondola cars. Insufficient capacities of the port stations complicate the development of the whole port sector. This has become a standard thesis in every delegate's speech at every conference. The Russian Railways answer by reporting about the money invested into port stations development. Evgeny Kaschenko, Deputy chief of the Far East Railways Center of Corporate Service told about the reconstruction program implemented in 2004 at the Nakhodka-Vostochnaya station. $10 mn was invested into the project. The port and terminal representatives agreed with the fact. However, they pointed put that the throughput of Port Vostochny, which uses this station, increased from 13 mn tons in 2001 to 20 mn tons in 2004, and the capacities of the station are not enough to satisfy all the requirements. And the amount of investment is not so much to be proud of, they say. Only VICS transferred in 2004 to the budget 12 bn rubles (almost $5 mn). The investments in development of the key-station in container transit by the TransSib are comparable with the sum that the Russian Railways receives from container security service during the whole year ($250 per TEU). Vladimir Buzanov, Nakhodka Commercial Sea Port Director of commerce, said that there was no reconstruction of the Nakhodka-Barkhatnaya station serving Nakhodka at all. In the year 2005 the port plans to handle over 8,8 mn tons of cargo. In 2002 the throughput of Nakhodka made 4,8 mn tons, in 2003 - 6 mn tons, in 2004 - 7,2 mn tons. According to V.Buzanov, 50% of the load on the port rail station is due to the actively developing non-specialized companies working at the port. Owing to the rolling stock deficit and the insufficient capacity of the port stations the ports try to dispatch more cargo by road. The number of containers dispatched from VICS by motor transport increased from 10% in 2004 up to 19% in the first quarter of 2005 - even taking into account the awful state of the roads in the region. One could almost say, there are no roads in the region, which was illustrated with the slides the speakers presented. Even if there were good roads, railway transport has no alternative due to the geographic position of the region. Steady increase in freight traffic is impossible without effective cooperation between the ports and the railroad. The contracts for dividing responsibility between railroad and ports, on which the Russian Railways insist, cannot solve all the problems emerging in the process of intermodal transportation. Vladivostok Commercial Sea Port suggested a new port-rail cooperation model envisaging establishing a joint managing company. This company would be entitled with managing and controlling the port-rail operations. Due to management optimization this structure may improve the efficiency of using the rail stations and port infrastructure capacities. Apart from corporate interests, much attention was paid also to departmental interests and problems. Nadezhda Zhikhoreva, head specialist of the port division, Department of state policy for rail, maritime and inland water transport, RF Ministry of Transport announced the news about plans for increasing port dues. The delegates complained about the Customs, however, understanding that the Customs work as they can and do not have enough staff to cope to clear cargo within 3 days as the new Customs Code requires. In the framework of the Conference, a round table devoted to improving the competitiveness of the Russian Far East was held. It is M.Frydrych's opinion that if the state is not ready to make sizeable investments in developing the transport sector, it could reduce taxes for investors. He illustrated this by the example of Qindao, where a friend of his is responsible for the development of the port. The both managers started working at one and the same time - some 5 years ago. Nowadays Qindao handles 3,5 mn TEUs per annum, while VICS - approximately 300 thousand TEUs. This does not mean that one terminal works better and the other worse. The thing is the Chinese port is exempted from taxes for 10 years and from customs duty for imported equipment for 15 years. In Russia this sound like a dream. Following the discussion the Conference delegates worked out a draft Resolution with recommendations for the RF Ministry of Transport, the RF Ministry of Economic Development and Trade, the RF Federal Agency of Maritime and Inland Water Transport, the RF Federal Agency of Rail Transport, the RF Federal Customs Service, the Primorie Kray Administration and Russian Railways JSC. The suggestions include developing a program of highway construction and reconstruction in the region, giving the sea port a definition as a geographic territory, defining their status and improving the system of state management and control at ports, creating an interdepartmental commission to develop a program of port rail stations capacities expansion, assisting developing the program of e-registering ships arrival, etc. The delegates addressed all the ministries and bodies involved with a request to work out agreed approach to the problems specified so as to improve the competitiveness of the region's transport sector by tariff and port dues regulation, port administration improvement, and administrative expense reduction. SeaNews Information & Consulting plans to organize the next Far East Conference next year. Please contact us for full information: SeaNews Information & Consulting Head Office in St.Petersburg Phone: +7 (812) 380-38-25 Fax: +7 (812) 380-38-27 Vladivostok: Phone: +7 (4232) 49-43-47 Phone/Fax: +7 (4232) 49-79-61
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