Friday, August 5, 2011

Potential Rail Freight Link To China Shows A Profit

Cooperation is the Key to Successful Logistics
Shipping News Feature

MONGOLIA – RUSSIA – CHINA – The future of environmentally acceptable, sustainable and economically viable freight transport between Russia and China lies firmly in the court of carriage of cargo by rail. The vast, often featureless distances which make up Mongolia as the world’s seventh largest country means logistics inevitably turns principally to container carriage on the tracks, and the news emanating from Ulan Bator Railways (UBR)this week has a positive note.

At a session of the UBR board this week a delegation led by Gansuch Amarzhargal, Mongolian Deputy Minister of railways, transportation, construction and urban development heard from Chairman Vadim Morozov, First Vice-President of Russian Railways (RZD) and Mongolian Railways CEO, that for the first time in recent years, UBR reported a positive financial performance. Mr Morozov commented:

“Last year UBR achieved operational improvements in both cargo and passenger transportation. Cargo flows stood at 16.8 mio, up 18.6% from 2009. Export freight, especially of iron ore, was up 57%, a substantial increase”

UBR is a joint 50/50 stock company, originally formed by agreement between the former USSR government and that of Mongolia. Ownership of the Russian stake was transferred from the Federal Railway Authority to Russian Railways (RZD) in 2009 with RZD charged with managing the equity stake for a term of five years.

With rail transport responsible for carrying 60% of all cargo throughput, RZD say their involvement has led to practical assistance for UBR in terms of capital repair of railway tracks, modernization of rolling stock, and technological improvements. UBR manages over 1800 kilometres of track sharing a common 1520mm gauge with Russia and will prove vital as trade tie ups between Russia and China, which many pundits view as important for Russia’s economic and political ambitions, develop.

Photo: Vadim Morozov