The annual Trans-Caspian Forum is held in Washington – Pylyp Travkin

The Caspian Policy Center organized the eighth annual Trans-Caspian Forum on May 21 in Washington, DC to discuss the current challenges and prospects for the multimodal Trans-Caspian International Transport Route (TITR) to maximize its capacity.

TITR is a multimodal route that runs through China, Kazakhstan, the Caspian Sea, Azerbaijan, Georgia and further to European countries. The development of the route is attracting increasing attention, becoming increasingly important to strengthen the economic sustainability of the region and promote the diversification of trade.

According to the data of the TITR International Association, in 2023 the volume of transportation through this corridor reached almost 2.8 million tons against 1.7 million in 2022. In the first quarter of 2024, this indicator reached 771 million tons.

Speaking at the opening of the meeting, the president of the Caspian Political Center, Efgan Nifti, noted the "wonderful" developments in the Caspian region over the past 12 months. These include progress in the development of the Middle Corridor, steps towards reconciliation between Armenia and Azerbaijan, increased involvement and investment from international partners, the transition to energy and the growing importance of minerals.

"The need to diversify trade routes is obvious. This gave a new impetus to the development of regional transport connections in Central Asia and the South Caucasus. "Continued support for projects like the Middle Corridor will not only promote political and economic relations in the region, but also support regional goals of connectivity, energy diversification and long-term development," Nifty said.

Vision of Kazakhstan

The development of TITR is also consistent with Kazakhstan's goal of becoming a transport and logistics hub .

Deputy Chief of Mission at the Embassy of Kazakhstan in the United States Rauan Tleulin emphasized the importance of the route, also known as the Middle Corridor. According to him, TITR is a strategic corridor for the supply of energy resources from the region to Europe and world markets.

"Along with oil and gas, we are focused on the transportation of conventional goods and essential goods," Tlewlin said.

He spoke about Kazakhstan's efforts to develop TITR. "Together with Azerbaijan, Georgia and Turkey, we also adopted a road map for the further elimination of so-called bottlenecks. The implementation of the agreements will allow to increase the total trade capacity to 10 million tons per year by 2025," the diplomat said.

The roadmap, signed in November 2022, outlines the priority areas of investment and actions needed to improve TITR. In June 2023, Azerbaijan, Georgia and Kazakhstan agreed to create a single logistics operator .

In 2023, Kazakhstan sent oil through the TITR for the first time, pumping it into the Baku-Tbilisi-Ceyhan pipeline under an agreement between KazMunayGaz and the Azerbaijani oil and gas company SOCAR.

Connectivity improvements

Arun Venkataraman, Assistant Secretary of Commerce for Global Markets and Director General of the US Global Markets and Foreign Trade Service at the US Department of Commerce, urged attendees to focus on improving transportation and logistics connectivity.

He said it goes beyond "just seaports, airports, cargo from roads, railways and highways, but also communication infrastructure, security systems".

"Our job at the Department of Commerce's Office of International Trade is to help businesses find partners overseas, achieve their goals and find solutions to help them achieve those goals," Venkataraman said.

Increasing US involvement is helping TITR

The development of the corridor will also benefit from increased engagement between the United States and the region, mainly Central Asia. US Deputy Assistant Secretary of State for Central Asian Affairs John Mark Pommersheim said that US engagement with Central Asian leaders is now more active than ever.

"Over the past year, our cooperation has reached a new high," he said, emphasizing the importance of the declaration signed by all five Central Asian leaders and the US president in September 2023.

"We have an opportunity for the US government to strengthen coordination among our international partners, including the G7 and other like-minded partners working in Central Asia, to share this common goal of promoting regional connectivity and economic sustainability in Central Asia and the South Caucasus. ", said the American diplomat.

A view from beyond

Addressing the second panel of the forum, Hors Classe Adviser of the European Commission's Directorate-General for International Partnerships, Henrik Hololei, said that the transformation of TITR into a "modern multimodal economic gateway" is one of the key projects for the European Union.

"It is in all our interests to make the corridor competitive, predictable, affordable and sustainable," he said.

Hololei emphasized that the development of this corridor is now more important than ever before.

"It's now or never for the corridor," he said. "In Soviet times, the corridor was not specially combined. It was a policy of division, not integration. However, now we have an opportunity to fix it."

At the same time, he announced that the EU-Central Asia coordination platform will be launched in Astana in a few weeks. The platform will create a permanent structure aimed at facilitating the implementation of projects in Central Asia.

In a recent interview with The Astana Times, Hololei expressed high hopes for the route, saying it could be a game-changer in connectivity between Asia and Europe.

Tamar Satterwhite, senior adviser for the Commercial Law Development Program (CLDP) of the US Department of Commerce's Office of the General Counsel, noted the poor coordination between countries along the corridor and investors.

"There is a lack of coordination between donor organizations, between countries and specific ministries in each country. That includes a lack of information sharing,” Satterwhite said.

Costs for eliminating bottlenecks

In its 2023 study, the European Bank for Reconstruction and Development estimated that the cost of meeting the corridor's hard and soft infrastructure needs could reach €17 billion (US$18.4 billion).

Winnie Wang, a leading infrastructure specialist and head of the Europe and Central Asia program at the World Bank, revealed the World Bank's estimates. According to her, the cost of primary investments can reach about 7 billion dollars.

“We see a big impact when projects are designed to address specific bottlenecks and define service levels. To this end, at the World Bank, we have deployed a range of regional and global monitoring tools to provide solutions for the corridor,” said Winnie Wang.

In November 2023, the group published a study titled Unleashing the Potential of the Middle Corridor, focusing on Kazakhstan, Azerbaijan and Georgia. The study suggests measures that could transform TITR into a vital trade route.

Among the recommendations are the implementation of logistics solutions along the length of the corridor for uninterrupted operations, simplification of border crossing procedures to facilitate traffic and data exchange, improvement of digital solutions and creation of a unified investment priority system.

With the right policies and investments, the corridor could triple trade volumes by 2030 to 11 million tonnes compared to 2021 levels and halve travel times, according to the study .