Being a landlocked country, Armenia depends on the access at borders with neighbouring states which benefit from these opportunities which determine the access to international markets. In order to improve the access on international markets, as well as to optimise the transit potential and the increase of freight volumes, Armenia initiates important projects in terms of the transport system on the Europe-Asia axis.
The reduced access to the main international transport can determine the increase of transport costs, the diminution of opportunities in international commercial exchanges, on the logistics and railway sectors. These aspects stimulate the authorities to launch infrastructure projects that should provide an easy access to markets, and the gain of access to the Black Sea ports becomes an important factor within the development of Armenia’s economy and international relations. According to a study of the Asian Development Bank (ADB) “this access would reduce the trade deficit by a third to a half, and would increase GDP by 30%. With no trade generated by the access to these ports, Armenia would register a modest GDP growth by 0.67%. In addition, the benefits brought to the GDP growth and the diminution of the commercial deficit, the settlement of cross-border problems will contribute to the increase of foreign investments not only at national level but also in the region”.
The main economic activities rely on the construction, mining, chemical and services sectors, which total 44% of the country’s economy, and the agricultural sector, which has a 10% contribution to the Armenian economy.
Due to the improvement of the global economic condition, at the level of exports, Armenia tries to benefit from this climate in order to supply on international markets chemical, mining products, which determine national economic recovery.
The railway network plays a vital role in the provision of freight and passenger mobility and consequently in Armenia’s economic development. The railway system transports a freight volume higher in the international traffic than in the national one, representing approximately 65%, out of which 45% represents import activities.
The continuous development of the mining industry in the southern part of Armenia has become an important factor for transport services, and for the optimisation of freight volumes, Armenia being determined to invest in the development of railway routes which will provide fast connections and performing services. Under the circumstances, the railway network modernisation is part of the country’s development strategy, which will contribute to the increase of the logistics sector. Approximately 30,000 containers are imported yearly through the Port of Poti (Georgia), out of which 30% is taken by the railway traffic. The traffic reopening at the border with Turkey will create new opportunities to Europe through Turkey. The new lines to be constructed that should provide connections at international level, are strategic projects for Armenian authorities, the railway company South Caucasus Railways having an important role in the network development. “One of the most important objectives is the integration in the transport system on the Europe-Asia axis, and this will be accomplished by developing the company, by implementing infrastructure projects both at national level and at international level, as well as by making the transport services more efficient and by increasing the quality of transport services”, declared Victor Rebets, General Manager of South Caucasus Railway, during the Railway Investment Summit in the Wider Black Sea Area 2012-Railway Days, organised by Club Feroviar and the Romanian Railway Industry Association.
Important projects for Europe-Caucasus-Asia
For the provision of a performing traffic, Armenia implements infrastructure projects on this axis for the development of transport connections with the ports in Georgia, Russia and Ukraine, with the terminals and railway networks in Turkey, Azerbaijan and Iran. The projects of railway connections will contribute to the significant decrease of travel times, but also of distances that must be covered between the two continents for the freight delivery.
One of the most important railway projects initiated by Armenia is the construction of the line to Iran, which has a total length of 540 km, out of which 500 km of line are on Armenian territory. Due to the position of the line crossing the southern part where the mining industry is developing actively, it will allow the development of the infrastructure and economy in the region and the organisation of the traffic in the Persian Gulf to the member states of the Black Sea Economic Cooperation Organisation (BSECO). The line will provide the shortest traffic route on the route Iran-Armenia and the states of the European Union.
As regards freight transit, Armenia holds a strategic position on the link Russia-Turkey, due to the fact that Russia is one of the largest coal suppliers for Turkey. Over 90% of Russia’s coal imports, or 9 million tonne, is provided by Kuznetsk Basin and the main railway route crosses the Russian territory to the Black Sea ports. Under the circumstances, there are two main railway routes aiming at the traffic through Central Asia and Iran and the one through Russia and here Azerbaijan and Armenia have an important role in the freight transit. “The transit route through Armenia is competitive both in terms of freight delivery times and prices, which explains Armenia’s high potential”, pointed out Rebets.
An important line for the railway freight transport is Vanadzor-Fioletovo, which will become part of the transport corridor on the East-West axis and will create the international transport corridor Europe-Caucasus-Asia, through Armenia.
The construction of the line will ensure railway links with several cities in Armenia, to Tbilisi (Georgia) and then Iran, determining the reduction of travel times and of transport costs. The feasibility project has already been elaborated and soon the ne-cessary costs will be estimated.
The launch of transport operations on this line, as well as the construction of a logistics centre (Akhuryan) will contribute to the significant increase of the attractiveness of TRACECA corridor. Akhuryan logistics point will connect centres in Turkey and will serve freight flows from and to Turkey, which are currently provided through Armenia on the transport links with the ports of Poti and Batumi. From here, the freight is transported to Europe, America and Asia.
The projects aimed at by Armenia for the increase of freight volumes and of the transit potential will meet the clients’ demands, will contribute to the identification of transport management resources, the improvement of the traffic organisation in the region and the freight delivery in due time.
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