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Whose interests does the Middle Corridor serve?

Expert’s comment, 02.10.2024(1)

Norayr A. Dunamalyan(2)

The importance of the Middle Corridor (also known as the Central Corridor or the “Trans-Caspian Transport Route”) has increased sharply in 2022-2024 against the background of the reform of the Eurasian land and sea routes due to the war in Ukraine and the blockade of the Suez Canal. It is noteworthy that in 2024 both representatives of the U.S. State Department(3) and officials of the People’s Republic of China(4) began to talk about the importance of this transportation route, although previously they had avoided the issue of multimodal transportation across the Caspian Sea as unprofitable from the economic point of view.

The growing interest in the Middle Corridor can be explained rather by geopolitical motives than by by economics. Until 2022, a number of projects initiated by the EU, the US, China, or other countries were considered doomed to failure due to the ethno-political conflicts in the region and the poorly developed infrastructure in the South Caucasus. Today, however, the implementation of the Middle Corridor project is perceived as a strategically crucial resource from the point of view of diversification of trans-Eurasian transportation routes, as well as expansion of geopolitical opportunities for the countries participating in the project.

Infrastructure alternative bypassing Russia

The main advantage of the Middle Corridor has become its alternative to transportation via Russia, although the transit time of goods to Europe is shorter than other land routes (about 20-25 days(5)), but several times longer than sea routes. For comparison, transportation of goods by rail from China to Europe via Kazakhstan, Russia and Belarus can require up to 9 days(6). It is also worth noting that in 2021, land transport will account for 5.8% of the total cargo turnover between the EU and China(7), since sea transport, despite its long duration, is considerably cheaper than multimodal routes, including ferry crossings, rail, and freight transport.

As a result, the volume of goods transported along the Middle Corridor is significantly inferior to other routes, although there are certain nuances here as well. There is a problem of cargo receiving capacities in the Caspian Sea ports. The ports of Aktau and Kuryk in Kazakhstan have a combined capacity of about 12 mln tons of cargo (excluding oil exports)(8), while the receiving port of Alyat in Azerbaijan can handle 15 mln tons(9). However, it is interesting to note that the largest port on the Caspian Sea is Turkmenbashi with a capacity of 17 mln tons excluding oil exports(10), which falls out of the Middle Corridor project mainly for political reasons, while the other participants lack infrastructure potential.

In terms of the volume of cargo transported through the Middle Corridor, the current picture is as follows: in 2023, the volume of international cargo transportation amounted to 2.76 mln tons(11), while via the railway component of the North-South Project (along the Russia-Azerbaijan-Iran and Russia-Central Asia-Iran routes) about 12 mln tons of cargo were transported. If we consider that the total volume of transportation in communication with China in the first quarter of 2024 increased to 42.5 mln tons(12), then the volume of cargo passing through the Middle Corridor seems critically small, although it is planned to increase the amount of goods transported to 11 mln tons by 2030. In any case, the question that remains is related to the advisability of investing in the Middle Corridor, which does not provide significant competitive advantages in the fight against other infrastructure projects.

A World Bank report, published in November 2023, noted several advantages of the Middle Corridor over the other initiatives: firstly, stimulating regional integration within the framework of infrastructure development and deepening economic ties between the countries of the South Caucasus and Central Asia; secondly, reducing Kazakhstan’s, Azerbaijan’s and Georgia’s dependence on Russia within the framework of diversification of trade routes and growth of the production potential of these countries(13). Meanwhile, the main problems of the Trans-Caspian route remain the poorly integrated transport systems of the countries participating in the project and the lack of an uninterrupted transit of goods. It should be noted that the idle time of goods occurs mainly in the Caspian ports, which increases the cost of transportation. Another problem is the shallowness of the Caspian Sea, which can render useless the new port communications, which require huge investments.

By and large, the Middle Corridor is still considered a regional project(14), incapable of significantly influencing the level of international trade. At the same time, the geopolitical significance and symbolism of this route play a significant role for global players who are trying to play out the current development of communications to their advantage.

Awaiting investments and a shift in the World order

The interests of Kazakhstan, Azerbaijan, and Georgia as the main beneficiaries of the Middle Corridor lie in the creation of bases for political and economic integration of the countries of the South Caucasus and Central Asia in order to minimize the pressure of the regional hegemons, in particular, Russia. On April 10, 2023, in Astana, the presidents of Azerbaijan and Kazakhstan signed a joint statement in which the Middle Corridor was declared by the states as one of the key priorities of the “national transport strategies”. The aim is to achieve economic and political sustainability within the states participating in the project. Apparently, the choice of such tactics is aimed at minimizing the influence of external forces in the context of the formation of a multipolar world, where the Middle Corridor can serve as a basis for an integration association.

In this context, it is worth paying attention to the position of the West, which is aimed at strengthening such initiatives designed for the isolation of Russia. For the West, it is important to “cut off” the countries of the South Caucasus and Central Asia from Russia using slogans of diversification and infrastructure development. In this context, the role of Kazakhstan as a territory geopolitically separating Uzbekistan, Kyrgyzstan, Tajikistan, and Turkmenistan from Russia is important. The creation of the Southern Transport Corridor with participation of the aforementioned countries, bypassing Kazakhstan, is supported by the RF precisely within the logic of countermeasures(15) aimed at limiting the Russian influence in Central Asia.

Another important aspect is the project to integrate the South Caucasus and Central Asia into a single political and economic space under the auspices of the EU and US. After the collapse of the USSR, such Western initiatives as TRACECA and INOGATE, as well as the unfinished Nabucco project, were aimed at detaching the southern part of the post-Soviet space into a separate geopolitical entity. It is precisely for this reason that the US and the EU first condemned the construction of communications in the South Caucasus bypassing Armenia in 2008, pointing to the potential strengthening of Russia’s position.

Following the same logic, the Western countries supported the civil society and humanitarian sphere in the South Caucasus, which continues today in Central Asia as part of the encouragement of compliance with the sanctions policy against the RF. On the other hand, the EU had to use Central Asian communications to deepen the diversification of its energy sector, which was already directed against China, trying to lead  oil and gas pipelines from Turkmenistan and Uzbekistan to the Chinese consumers.

Despite all this, the position of the PRC remains the most crucial factor in the development of the Central Corridor. China’s interest in the project can be explained by the infrastructure development within the framework of the One Belt, One Road initiative; however, unlike the EU, the Chinese leadership is not working on the integration of Central Asia and the South Caucasus, but on building partnerships with each country of the corridor separately. Therefore, China’s support for the Central Corridor project is being provided individually on the basis of Kazakh-Chinese agreements within the framework of the New Silk Road(16), as well as declarations of strategic partnership with Georgia(17) and Azerbaijan(18). It is important for China to ensure uninterrupted communication with Europe via trans-Eurasian land routes, so the Middle Corridor is considered an important asset for further development of infrastructure in the direction of the Middle East, Iran, and Turkey.

In other words, we see a common desire to create consonant projects in the field of transportation development and economic ties against the backdrop of geopolitical confrontation, which demonstrates the struggle of tactical and strategic approaches of global and regional players(19). At first glance the general vector of the policy may seem to be a coincidence of interests, but the difference lies in the ultimate goals. Summarized, it indicates a common desire to create consonant projects in the field of transport development and economic ties against the backdrop of geopolitical confrontation, which demonstrates the struggle of tactical and strategic approaches of global and regional players. The general vector of policy, on the surface, may seem like a coincidence of interests, but the difference lies in the final objectives. However, China is in possession of investments and is well developed in terms of infrastructure, but still has weak influence in the region; the economies of the Middle Corridor countries successfully attract investments, but are structurally and institutionally underdeveloped; the EU has links with all regional actors, but is limited in implementing investments in this project(20). Based on this, it is possible to achieve a synergetic effect through the potential of several actors at the same time.

North-South as a geopolitical barrier for the Middle Corridor?

In any case, the main result of the implementation of the Middle Corridor remains the bypassing of the Russian territory within the framework of the establishment of transport communications (including oil and gas pipelines) through Central Asia and the South Caucasus to Europe. In response to the current situation, Russia is trying to restore the former Soviet infrastructure (in particular, through Azerbaijan, Armenia, Georgia, and Abkhazia), tying up all regional transport routes to itself and not allowing the bypassing of the Russian territory within the framework of any large-scale initiatives. The North-South project in this context is perceived as a barrier to the spread of the Western influence in the South Caucasus and Central Asia, since it crosses all the past and future communications in these regions. However, this creates an extremely complicated geopolitical situation.

The countries through which the western and eastern routes of the North-South ITC pass are politically interested in limiting Russian influence in the region and are unlikely to favor the North-South project instead of the Middle Corridor. For Azerbaijan and Kazakhstan, this transportation route has less economic than political significance, aimed at strengthening their independence and involving other countries in the region into their orbit of interests. In contrast to Russia’s relations as a great power with the medium-sized countries of Turkey and Iran, the alliance between the countries participating in the Middle Corridor project is perceived as an association of geopolitically vulnerable states seeking to reduce the influence of any extra-regional actor claiming hegemony in the South Caucasus and Central Asia, which is in line with the US foreign policy doctrine regarding small countries in Eurasia.

On the other hand, relations between the Russian Federation and Iran are far from being stable and are tactical in nature, which calls into question the efficiency of transport routes through Iranian territory in the future. Iran’s territory could potentially become the most significant resource for ensuring seamless transportation between China, on the one hand, and Turkey, Europe, the Middle East, and Africa, on the other, but political problems and sanctions against IRI hinder the inflow of investment into the country’s transportation system. The leadership of the Islamic Republic, in turn, are trying to resist regional transport projects aimed at isolating Tehran. As a result, the Iranian position firmly rejects the establishment of a single Middle Corridor infrastructure bypassing Iran, calling the project the “NATO’s Turan Corridor(21). At the same time, the Iranian authorities are trying to minimize the risks through integration into the infrastructure system of the Middle Corridor by building communications linking Azerbaijan with Nakhijevan (Nakhichevan) through its territory (the Araks Corridor) and building the Astara-Rasht railway as part of the North-South project.

Therefore, the statements of the Russian side about the “sabotage” of the opening of the communications through Syunik by Armenia triggered diplomatic pushback from Iran(22). It is noteworthy that the Russian Federation, unlike Iran, does not clearly state its position on the Middle Corridor, and limits itself to promoting its interests in the South Caucasus region within the framework of the search for alternative routes for the delivery of oil and gas to Europe. As a result, the Russian authorities’ support for the Azerbaijani narrative on the so-called “Nagorno-Karabakh Corridor” is included in the general context of “Russian-Armenian concessions”(23) (Armenia’s concessions after 2020 should not be perceived only in the framework of purely Armenian interests) against the background of the political and economic situation caused by the war in Ukraine. On the other hand, the Russian authorities hope to outmaneuver Turkey in the context of the construction of a new communication system in the region, trying to prevent the construction of a railway from Igdir to Nakhijevan and, by this step, to restore the “Soviet” transportation system, which is completed in the territories of Abkhazia, Georgia, Armenia and Azerbaijan with two exits to the outside world: Baku–Tbilisi–Kars and Julfa–Tebriz (the Kars–Gyumri route can also be considered by Russia as an analog of the Igdir–Nakhijevan railway). However, the Russian side does not take into account two circumstances: firstly, the construction of the Baku–Tbilisi–Kars railway, despite its unprofitability (only 680.000 tons of cargo in 2022 with the capacity of 6 mln tons), was designed primarily as a political project(24), integrated into the New Silk Road, where Russia could be a “user”, not a beneficiary; secondly, the political weight of the Middle Corridor project, with the support of the USA, can be directed both against Russia and Iran, and against the excessive influence of Turkey. In other words, the main problem is not the technical difficulties of transporting goods, but the construction of an independent region that will play the role of “Russia’s soft underbelly” (in A. Solzhenitsyn’s terms). Based on this, the unprofitability and non-competitiveness of the Middle Corridor in the short term can be ignored in favor of the long-term political interests of international actors aimed at weakening Russia and Iran. In this context, the factor of geopolitical struggle between Russia and the West over the opening of communications through Armenia is intensifying, which may be accompanied by the “entrance” of China into the region, that will be considered as a consensus decision, for example, in the framework of servicing the transport corridor through Syunik.

Armenia’s interests in this configuration are to maintain sovereignty over its territory and to benefit from new transport routes, but the main threat is the political orientation of the Middle Corridor, within which they will try to neutralize the Armenian factor as potentially “pro-Russian” or “pro-Iranian”. Under the current circumstances, Armenia must quickly complete the construction of the southern part of the North-South Highway, which will lead to a rapprochement of interests with Iran and partially secure the country’s southern frontiers. At the same time, an alternative to the corridor through Syunik could be the discussion of opening roads through Ijevan and Yeraskh, which will shift the attention from political problems to infrastructural ones.

SOURCES AND LITERATURE

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  2. Ахмедзаде Ш., В обход России. В чем смысл развития Срединного коридора из Китая в Европу / Берлинский центр Карнеги (24.07.2024), https://carnegieendowment.org/russia-eurasia/politika/2024/06/silk-road-war-ukraine?lang=ru
  3. Бояров Э., Каспийский порт Туркменбаши увеличил объем международных грузоперевозок / Daryo (16.11.2023), https://daryo.uz/ru/2023/11/16/kaspijskij-port-turkmenbasi-uvelicil-obem-mezdunarodnyh-gruzoperevozok
  4. Быкова А., Железнодорожные перевозки из Китая в Европу вновь обрели популярность / Lardi Today (23.01.2024), https://logist.today/ru/dnevnik_logista/2024-01-23/zheleznodorozhnye-perevozki-iz-kitaya-v-evropu-vnov-obreli-populyarnost/
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  6. В азербайджанском порту Алят выделен отдельный участок для грузов из Туркменистана / Turkmenportal (25.11.2022), https://turkmenportal.com/blog/54703/v-azerbaidzhanskom-portu-alyat-vydelen-otdelnyi-uchastok-dlya-gruzov-iz-turkmenistana#
  7. Гарибашвили рассказал в Давосе о «Среднем коридоре», отношениях с КНР и инфраструктурных проектах / Civil Georgia (20.01.2024), https://civil.ge/ru/archives/578123
  8. Дунамалян Н. А., Геополитическое позиционирование Южного Кавказа в контексте противостояния Запад–Россия: мотивы, субъекты и факторы / Центра Арвак (25.07.2023), https://arvak.am/ru/геополитическое-позиционирование-юж/
  9. Евразийский транспортный каркас / Аналитический доклад ЕАБР (Июнь 2024), https://eabr.org/upload/iblock/6ce/Evraziyskiy-transportnyy-karkas.pdf
  10. Заседания Рабочей группы по развитию Транскаспийского международного транспортного маршрута проведены в Шымкенте / Международная ассоциация «ТМТМ» (31.05.2024), https://middlecorridor.com/ru/press-tsentr/novosti/zasedaniya-rabochej-gruppy-po-razvitiyu-transkaspijskogo-mezhdunarodnogo-transportnogo-marshruta-provedeny-v-shymkente
  11. Ильюшенков Д., Транзит контейнеров из Китая в Европу через Россию вырос в 1,5 раза / Ведомости (05.04.2024), https://www.vedomosti.ru/business/articles/2024/04/05/1030001-tranzit-konteinerov-iz-kitaya-v-evropu-cherez-rossiyu-viros
  12. Китай придает большое значение Среднему коридору – временный поверенный в делах Китая / Business media (05.07.2024), https://bm.ge/ru/news/kitai-pridaet-bolsoe-znacenie-srednemu-koridoru-vremennyi-poverennyi-v-delax-kitaia
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  15. Ногойбаев К., Какие риски для Казахстана несет проект “Южного коридора”? / Cabar Asia (04.08.2023), https://cabar.asia/ru/kakie-riski-dlya-kazahstana-neset-proekt-yuzhnogo-koridora
  16. Пропускная способность морских портов Казахстана составляет 23,7 млн тонн грузов в год / Интернет-портал СНГ (14.03.2022), https://e-cis.info/news/567/98869/
  17. Саркисян Л., «Средний коридор» на повестке: может ли Ереван подключиться к Транскаспийскому маршруту? / Sputnik Armenia (03.07.2024), https://am.sputniknews.ru/20240703/sredniy-koridor-na-povestke-mozhet-li-erevan-podklyuchitsya-k-transkaspiyskomu-marshrutu-77940360.html
  18. Средний коридор изо всех сил пытается найти свой путь через Евразию / ERAI (13.01.2021), https://index.com/analytics/sredniy-koridor-izo-vsekh-sil-pytaetsya-nayti-svoy-put-cherez-evraziyu/
  19. Средний торгово-транспортный коридор/World bank group (Ноябрь 2023), https://thedocs.worldbank.org/en/doc/6db8357f7577756fc20492968d8bc0ca-0080062023/original/Middle-Trade-and-Transport-Corridor-Executive-Summary-RUS.pdf
  20. Фальшивые Зангезурский и Транскаспийский коридоры / Pars Today (14.05.2024), https://parstoday.ir/ru/radio/iran-i200962
  21. Азербайджан и Китай приняли декларацию о стратегическом партнерстве / TACC (03.07.2024), https://tass.ru/mezhdunarodnaya-panorama/21267517
  22. Road freight transportation from the EU to China: current status and prospects / ERAI – Information and analytical digest (April 2022), https://index1520.com/upload/medialibrary/afe/h84w9oykb18i5bym6wippefdy2x8uz75/ERAI-AutoEN.pdf

(1) The original (in Rus.) was posted on our website on 27.09.2024.

(2) UNDP National expert (power sector), EU National expert (transport), EAEC Expert Club fellow, Ph.D., Senior Scientific Researcher, Leading analyst.

(3) Саркисян Л., «Средний коридор» на повестке: может ли Ереван подключиться к Транскаспийскому маршруту? / Sputnik Armenia (03.07.2024), https://am.sputniknews.ru/20240703/sredniy-koridor-na-povestke-mozhet-li-erevan-podklyuchitsya-k-transkaspiyskomu-marshrutu-77940360.html (download date: 10.09.2024).

(4) Китай придает большое значение Среднему коридору – временный поверенный в делах Китая / Business media (05.07.2024), https://bm.ge/ru/news/kitai-pridaet-bolsoe-znacenie-srednemu-koridoru-vremennyi-poverennyi-v-delax-kitaia (download date: 10.09.2024).

(5) Заседания Рабочей группы по развитию Транскаспийского международного транспортного маршрута проведены в Шымкенте / Международная ассоциация «ТМТМ» (31.05.2024), https://middlecorridor.com/ru/press-tsentr/novosti/zasedaniya-rabochej-gruppy-po-razvitiyu-transkaspijskogo-mezhdunarodnogo-transportnogo-marshruta-provedeny-v-shymkente (download date: 10.09.2024).

(6) Быкова А., Железнодорожные перевозки из Китая в Европу вновь обрели популярность / Lardi Today (23.01.2024), https://logist.today/ru/dnevnik_logista/2024-01-23/zheleznodorozhnye-perevozki-iz-kitaya-v-evropu-vnov-obreli-populyarnost/ (download date: 10.09.2024).

(7) Road freight transportation from the EU to China: current status and prospects / ERAI – Information and analytical digest (April 2022), https://index1520.com/upload/medialibrary/afe/h84w9oykb18i5bym6wipp efdy2x8uz75/ERAI-Auto_EN.pdf (download date: 10.09.2024).

(8) Пропускная способность морских портов Казахстана составляет 23,7 млн тонн грузов в год / Интернет-портал СНГ (14.03.2022), https://e-cis.info/news/567/98869/ (download date: 10.09.2024).

(9) В азербайджанском порту Алят выделен отдельный участок для грузов из Туркменистана / Turkmenportal (25.11.2022), https://turkmenportal.com/blog/54703/v-azerbaidzhanskom-portu-alyat-vydelen-otdelnyi-uchastok-dlya-gruzov-iz-turkmenistana# (download date: 10.09.2024).

(10) Бояров Э., Каспийский порт Туркменбаши увеличил объем международных грузоперевозок / Daryo (16.11.2023), https://daryo.uz/ru/2023/11/16/kaspijskij-port-turkmenbasi-uvelicil-obem-mezdunarodnyh-gruzoperevozok (download date: 10.09.2024).

(11) Евразийский транспортный каркас / Аналитический доклад ЕАБР (Июнь 2024), https://eabr.org/upload/iblock/6ce/Evraziyskiy-transportnyy-karkas.pdf (download date: 10.09.2024).

(12) Ильюшенков Д., Транзит контейнеров из Китая в Европу через Россию вырос в 1,5 раза / Ведомости (05.04.2024), https://www.vedomosti.ru/business/articles/2024/04/05/1030001-tranzit-konteinerov-iz-kitaya-v-evropu-cherez-rossiyu-viros  (download date: 10.09.2024).

(13) Средний торгово-транспортный коридор / World bank group (Ноябрь 2023), https://thedocs.worldbank.org/en/doc/6db8357f7577756fc20492968d8bc0ca-0080062023/original/Middle-Trade-and-Transport-Corridor-Executive-Summary-RUS.pdf (download date: 10.09.2024).

(14) Ахмедзаде Ш., В обход России. В чем смысл развития Срединного коридора из Китая в Европу / Берлинский центр Карнеги (24.07.2024), https://carnegieendowment.org/russia-eurasia/politika/2024/06/silk-road-war-ukraine?lang=ru (download date: 10.09.2024).

(15) Ногойбаев К., Какие риски для Казахстана несет проект “Южного коридора”? / Cabar Asia (04.08.2023), https://cabar.asia/ru/kakie-riski-dlya-kazahstana-neset-proekt-yuzhnogo-koridora (download date: 10.09.2024).

(16) Быкова А., Китай обратил внимание на «Средний коридор» и готов инвестировать в его развитие / Lardi Today (19.10.2023), https://logist.today/ru/dnevniklogista/2023-10-19/kitaj-obratil-vnimanie-na-srednij-koridor-i-gotov-investirovat-v-ego-razvitie/ (download date: 10.09.2024).

(17) Гарибашвили рассказал в Давосе о «Среднем коридоре», отношениях с КНР и инфраструктурных проектах / Civil Georgia (20.01.2024), https://civil.ge/ru/archives/578123 (download date: 10.09.2024).

(18) Азербайджан и Китай приняли декларацию о стратегическом партнерстве / TACC (03.07.2024), https://tass.ru/mezhdunarodnaya-panorama/21267517 (download date: 10.09.2024).

(19) Дунамалян Н. А., Геополитическое позиционирование Южного Кавказа в контексте противостояния Запад–Россия: мотивы, субъекты и факторы / Центр АРВАК (25.07.2023), https://arvak.am/ru/геополитическое-позиционирование-юж/ (download date: 10.09.2024).

(20) Средний коридор изо всех сил пытается найти свой путь через Евразию / ERAI (13.01.2021), https://index1520.com/analytics/sredniy-koridor-izo-vsekh-sil-pytaetsya-nayti-svoy-put-cherez-evraziyu/ (download date: 10.09.2024).

(21) Фальшивые Зангезурский и Транскаспийский коридоры/Pars Today (14.05.2024), https://parstoday.ir/ru/radio/iran-i200962 (download date: 10.09.2024).

(22) Аракелян Э., «Зангезурский коридор»: есть ли у Тегерана рычаги воздействия? / Civilnet (06.09.2024), https://www.civilnet.am/ru/news/796106/зангезурский-коридор-есть-ли-у-тегерана-рычаги-воздействия (download date: 10.09.2024).

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