Rhenus Logistics: German business to support Middle Corridor via EU initiatives

The participation of German business in the future development of the Middle Corridor (Trans-Caspian International Transport Route, TITR) will be carried out predominantly through European Union initiatives, said Alexandra Ogneva, Project Manager for Eastern Europe, Caucasus, and Central Asia at Rhenus Logistics, in response to a question from Report during the webinar "Middle Corridor: Business Opportunities in Azerbaijan and Kazakhstan."

According to her, Germany does not have a unified public-private partnership model that would allow German companies to participate directly in projects aimed at developing the Middle Corridor.

"Business involvement will predominantly occur through pan-European initiatives, such as the Global Gateway strategy. It is aimed at combining public funds with private capital and ensuring the investment attractiveness of projects," Ogneva explained.

She added that German companies have access to federal government instruments: export guarantees for hedging risks in deliveries and services, Federal investment guarantees for protection against political risks in developing countries, as well as financing through KfW bank and its subsidiaries.

According to her, Rhenus Logistics has identified around eight projects for implementation along the Middle Corridor: "We have identified up to eight projects along the entire route between Istanbul and China - from small depots to large terminals. We view the Middle Corridor as a strategic direction. There is growing demand, including for intra-regional transportation - for example, between Azerbaijan and Kazakhstan or Kazakhstan and Georgia. We believe this route has a great future," she emphasized.

Ogneva noted that German logistics companies are showing interest in operating in the Central Asia region, and investors from China are acting on a much larger scale in this region.

"Cities such as Xi'an, Urumqi, and Lianyungang are extremely proactive in the logistics sphere. The port of Lianyungang already has two investment projects: one on the Chinese-Kazakh border, and the second is a container hub at the port of Aktau (Kazakhstan). Unlike German business, the Chinese side is actively investing specifically in infrastructure. We cannot yet afford this, while Chinese companies have government orders and budgets that allow them to build even railway tracks," the project manager added.