The reduced use of the Northern corridor multiplies the importance of the The Trans-Caucasus Transport Corridor (CTC) and Middle Corridor and gives a chance to beneficiaries of the corridor, including Azerbaijan, to increase drastically the traffic through the corridor, World Bank (WB) told Report.
As WB explained, the reduced use of the Northern corridor is caused by the ongoing situation in Ukraine: "The ongoing war in Ukraine has complicated transportation between China and Europe via the Northern land corridor through Russia and increased the importance of the Middle Corridor, including the CTC, as a viable alternative."
The CTC is one of the important traditional East-West trade and transit routes which links Azerbaijan and Georgia with Europe, China, Kazakhstan, and other regional countries. The corridor has the potential to play a larger role in connecting China with Europe, and Central Asia with the global economy, noted the bank.
"Development of a reliable and high-density land corridor between China and Europe is a regional priority for Azerbaijan and Georgia. This is based on the importance of the trade relationship between China and Europe, and also of the economic development that can be achieved by countries along this corridor. For example, China’s external trade amounts to about a third of its gross domestic product, totaling over US$4.5 trillion annually with the EU being one of the largest trade partners of China. A recent World Bank report concluded that the implementation of such an initiative would increase GDP by 3.4 percent for participating countries," said WB.
"Goods transported along the CTC primarily consist of oil and petroleum products as well as products consumed locally. Petroleum products are transported mainly from Azerbaijan and Kazakhstan to Georgian Black Sea ports, from where tankers take them farther on to European countries, while most imports come from Turkey or via Georgian Black Sea ports for the regional market. Until recently, few if any containerized goods traveled eastbound from Azerbaijan to Central Asia," WB said, adding that meanwhile most European-Chinese trade is currently transported in containers (which are of significant importance to the global economy).