CPC - Caspian Policy Center

Research

the middle corridor is opening

The Middle Corridor Is Opening

Author: Bruce Pannier

Jan 22, 2024

Image source: Port of Baku

On January 11, a train from Xian, China, arrived in Azerbaijan, having made an approximately 3,200-mile journey across Kazakhstan and the Caspian Sea in the short time of 11 days.

Just a few years ago, such a trip could have taken up to 50 days or more, but the train from Xian was passing through the Middle Corridor, a trade and transportation network that has been expanding rapidly to become an alternative to shipping goods through Russian territory.

Now, add in the current problems shipping cargo through the Suez Canal due to Houthi militia in Yemen attacking vessels in the Red Sea area, and the importance of the Middle Corridor is even higher.

The Middle Corridor is a network of roads, railways, and ships that connect Europe to Asia through the Caucasus and Central Asia and across the Caspian and Black seas. 

This network is actually a combination of various projects implemented over the course of some 25 years. The Asian Development Bank’s Central Asia Regional Economic Cooperation corridors, China’s Belt and Road Initiative, the Trans-Caspian International Transport Route, and others, including the United States and NATO and their Northern Distribution Network to supply operations in Afghanistan, have all contributed more branches to the Middle Corridor.

Still, East-West trade using the Middle Corridor was small until Russia launched its full-scale invasion of Ukraine in late February 2022. In the two years since then, the potential of the Middle Corridor has expanded significantly.

The Astana Times reported on December 28, 2023, that the volume of cargo transportation via the Middle Corridor in the January-September period that year reached 2 million tons, up from 1.1 million tons during the same period in 2022.

Kazakhstan’s Caspian ports are seeing huge increases in volumes of cargo traffic. In 2021, Kazakhstan’s Aktau and Kuryk ports handled less than 1 million tons of goods. In December 2023, Kazakh Transport Minister Marat Karabayev said, “Volumes along this (trans-Caspian) corridor doubled and amounted to 2.5 million tons.”

The combined capacity of those two ports – Aktau and Kuryk – is some 21 million tons annually. 

Across the Caspian Sea in Azerbaijan, the new Alat port outside Baku is already able to handle some 15 million tons of cargo with a goal of increasing that to 25 million tons. 

Railways, such as the Baku-Tbilisi-Kars route, connect Azerbaijan through Georgia to Türkiye, and from there into Europe. Georgian ports at Batumi and Poti have been upgraded and expanded for shipments by vessel across the Black Sea to ports in Romania and Bulgaria.

While growing, the capacity of the Middle Corridor remains modest.  Certainly, transportation by this route cannot compare to the more than 1 billion tons of cargo that goes through the Suez Canal annually.

However, the Middle Corridor is currently open, while sending cargo through the Red Sea and Suez Canal is greatly reduced due to the dangers of attack.

Germany’s Kiel Institute for the World Economy reported: “The number of containers shipped in the Red Sea fell drastically by more than half in December (2023).”

The San Francisco-based logistics and supply chain management company Flexport reported in week 48 of 2023 that “about 66% of 7,500+ TEU container vessels were transiting the Suez Canal,” but as of week one of 2024, that had dropped to some 3%.

Houthi attacks on ships in the southern Red Sea have forced many companies to reroute and take the route around southern Africa’s Cape of Good Hope, adding some 6,000 additional nautical miles and an estimated $1 million in extra fuel costs per vessel to the journey between Asia and Northern Europe. Usually, hundreds of cargo ships pass through the Suez Canal every month.

The average time for maritime shipments between East Asia and Europe is 30-45 days, but the detour around Africa adds an additional 10-13 days. The Guardian reported that could potentially add “three or four weeks to product delivery times.”

Reuters reported on January 12 that the Tesla factory in Germany was suspending operation for two weeks due to delays in parts arriving from Asia that usually would pass through the Suez Canal.

The train from China that arrived in Azerbaijan this month was pulling 55 40-foot wagons of Chinese electric cars, construction material, pipes, and other goods. The Middle Corridor is already a viable solution to shipping parts and equipment; and as it expands and transport time is reduced, the Middle Corridor could provide a reliable route for bringing goods from East Asia to the heart of Europe in well under one month.

Plans call for increasing the volumes of cargo transiting the Middle Corridor to 11 million tons annually by 2030.  But even meeting that goal will require substantial investment and help with logistics.

However, looking at the current situation where Russian routes are hampered by sanctions and maritime trade constricted by hostilities in the Middle East, the need for diversification of trade routes is obvious.

This makes expanding and increasing the efficiency of the Middle Corridor all the more important for the future.


Related Articles

Middle Corridor

European and International Financial Institutions to Invest $10 Billion in the Middle Corridor

The Global Gateway Investors Forum for EU-Central Asia Transport Connectivity convened January 29-30 in Brussels, uniting high-level representatives

Middle Corridor

The Middle Corridor Infrastructure Deals and Developments: 2023 in Review

Before Russia’s invasion of Ukraine, the Middle Corridor transit route seemed farfetched. It was rarely discussed by Western leaders, and to