Preliminary Forecast on Transport Volumes and Shipping Costs at Pacific End of Tumen Transport Corridor Study Project
Priority Sector: Transport
Participating Countries: People’s Republic of China, Republic of Korea, Russian Federation
Timeframe: 2014-2015
Budget: 60,000 USD
Sources of Funding: UNDP/ROK Trust Fund
Project Status: Completed
Project Framework
Background
Rajin (DPRK) and Khasan (Russia) Railway and Ports (Rajin, Zarubino and adjacent ports) are key segment and nodes of the transportation corridor in Northeast Asia and will generate greater trade volume, reduce cargo delivery time and transport costs in regional trade. The reconstruction of the Rajin-Khasan railroad section and renovation of the Rajin Port are the initial parts of a larger project to connect the Trans-Siberian Railway (TSR) and Trans-Korean Railway (TKR).
On March 24, 2009, in Ulaanbaatar (Mongolia) at the 10th Consultative Commission Meeting of the Greater Tumen Initiative (GTI), the Rajin-Tumangang Project was approved to be included in the list of GTI priority projects. In August 2013, at the 3rd Transport Board Meeting in Vladivostok, ROK side proposed Study Project titled “Preliminary Economic Analysis of Rajin Port Development Component” to be carried out with the financial support from ROK-UNDP Trust Fund, and Board members approved the proposal.
Bearing in mind the key position of the Rajin Port and link to GTI corridor and reflecting opinions and concerns from the GTI Transport Board members, GTI Secretariat has prepared the TOR on the Preliminary Forecast on Transport Volumes and Shipping Costs at Pacific End of Tumen Transport Corridor (hereafter the Study Project). Member countries have provided their approval at the 14th CC Meeting in October 2013.
Goal
The goal of the Study Project is to foster economic development of the region by establishing an operational connection between TSR and TKR.
Objective (s)
Development objectives of the study project are:
- to contribute to the improvement of overall logistics environment in NEA by modernizing and up-grading railway connections and port facilities in the region;
- to strengthen international cooperation and partnership in development of transport infrastructure in the region.
Outputs and Key Activities
Study Activities include:
I. Desk and field trips focusing on:
§ outline of the project’s progress to date and current plans;
§ bulk and container traffic forecast based on the trade trends and situation in Northeast Asia focusing on Tumen Delta connecting Hunchun (China), Zarubino Port (Russia) and Rajin (DPRK);
§ setting-up the scenario (ex: business-as-usual, increase in the number of destinations scenario and scenario when the destinations start to include the whole NEA regions) considering trade trends and geopolitical situation in Tumen Delta and Northeast Asia;
§ optimal capacity of the port considering the destination scenario and type of cargo;
§ estimates of time and cost to conversion of the Rajin port from the bulk cargo into container port;
§ recommendations on ways of fitting the pier 3 (Rajin port) into the plans for newly constructed other piers;
§ outline of the forms of project financing, currently employed by ROK, Russia and DPRK; and
§ Suggestions on financing options using international PPPs that would meet requirements of investors. For instance, the project might be a pilot project for NEA EXIM Banks Association or joint project among GTI member countries Development Banks and international Development Banks.
II. Consultations and discussion among stakeholders to ensure information exchange and to establish partnership:
§ Project meetings such as kick-off, interim and final
§ Joint sessions within relevant GTI events (GTI Transport Board meetings, Trade Facilitation Meeting, etc.);
§ Special sessions within GTI meeting (National Coordinators meeting or Consultative Commission Meeting).
Study output is the Study Report that will serve as reference and guidelines for members of GTI Transport Board in implementation of the relevant part of the GTI Regional Transport Strategy, i.e. finding optimal ways for the development of Pacific ports at the Tumen Transport Corridor.
Outputs Produced and Key Activities
The GTI Secretariat served as a coordinating agency and provided necessary administrative support to the study. The GTI Secretariat facilitated the preparation and organization of the Project Meetings, monitored, reviewed the outcomes of the study and arranged publication of the Final Project Report.
The Project Team consisted of three consultants from China, Mongolia and ROK representing transport and logistics research institutes. The ROK consultant served as Team Leader for the Study project and preparation of the project report. Russian Railways provided informational support for the Study.
On 13 June 2014, the GTI Secretariat hosted the Interim Seminar for the Study Project, with support from the Hunchun City local government in Jilin Province, China. Preliminary research results were presented by national consultants from China, Mongolia, and ROK at the seminar, and based on feedback from the stakeholders, the Study Project was extended for an additional four months (November 2014-February) in order to incorporate the most recent forecasts and data into the Final Report.
The extended project period was concluded with the discussion and dissemination of research results to relevant stakeholders at the 5th Transport Board meeting in Ulaanbaatar, June 2015.
Overall Assessment
Study Report “Preliminary Forecast on Transport Volumes and Shipping Costs at Pacific End of Tumen Transport Corridor” was prepared by Dr. Hee-Seung NA in accordance with decisions of 13th GTI Consultative Commission and 3rd GTI Transport Board meetings with the financial support from ROK-UNDP Trust Fund.
The Study has been carried out to analyze current situation surrounding the Rajin port development and relating facilities based on 3 individual country reports from China, Mongolia and ROK. The Study results and conclusions provide potential investors with persuasive and comprehensive information and serve as reference and guidelines for members of GTI Transport Board in implementation of the relevant part of the GTI Regional Transport Strategy, in particular finding optimal ways for the development of Pacific ports at the Tumen Transport Corridor.
Follow up Actions including Lessons learnt
The GTI Member countries should identify the issues for further studies and cooperation activities in the future based on the policy recommendations in the Study Report, including:
Ÿ Studies for specific issues that were in-detail covered by the Study;
Ÿ Economic evaluation studies for particular projects and items proposed;
Ÿ Promotion and support of transport cooperation in NEA by participating in and supporting similar initiatives in NEA.