the challenges facing landlocked developing countries: a case study ...

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KAZAKHSTAN Kazakhstan relies on two main commodities for the bulk of its export revenue: oil (49.3%) and base metals (24.4%), which are destined for a highly diversified group of countries (EIU 2002). While infrastructure does exist to transport these goods to market, utilising these infrastructure links is highly politically dependent on Kazakhstan’s neighbors. Most Kazakh oil and gas, for example, must be transported through pipelines in either Russia or Iran, both of which compete directly with Kazakhstan on the energy market. A pipeline has been constructed (through Russia) to transport oil to the Black Sea. However, the use of this route is limited because oil tankers must pass through the narrow Bosporus, where Turkey placed restrictions on passage as of October 2002 (DOE EIA 2002). The significance of this problem is that an alternative route is being preliminarily investigated to bypass the Bosporus by transporting oil through Bulgaria. Base metals and other exports are shipped largely using the railway system through Russia, which is ageing and suffering from maintenance troubles. Rail transport through to China is also limited by a required change in rail gauges at the border. TRANSPORT INFRASTRUCTURE Road Although Kazakhstan’s road system is well linked with the Russian road system, its roads are less important for transit trade than those of most landlocked countries, as the rail system is the primary mode of transit. Due to the underinvestment in infrastructure in Russia and other former Soviet states, the condition of the transit roads is relatively poor. Some traditional services linkages with neighboring countries have been severed in the wake of independence. For example, as of 2000 only very few of the original bus connections between Central Asian republics remained (Mayhew 2002). BASIC INFORMATION HDI Rank: 79 GDP per capita 2000 (PPP$): $5,871 Exports per capita 2000 (current USD): $722 Distance to port: 3,750km Transport cost ratio (2000): 0.04 Neighbors: Azerbaijan, China, Kyrgyzstan, Russia, Turkmenistan, Uzbekistan Primary transit neighbor: Russia Main trading partners: Imports: Germany (7%), United States (5%) Exports: Italy (11%), China (8%) Primary Exports: Oil (49.3%) Metals (24.4%) Domestic Roads: poor Transit Country Roads: fair Domestic Rails: Transit Country Rails: fair fair Transit Country Ports: good Neighboring Civil Conflict: low Relations w/ Neighbors: fair Exacerbating the challenges of relatively poor surrounding transit roads, Kazakhstan’s domestic roads are in poor condition. In 1996 only 10% of Kazakhstan roads could accommodate trucks with an axle load of 10 tons or more (UNESCAP 2002). While this is partly due to underinvestment, the Kazakh government states that difficult natural and climatic conditions as well as a lack of suitable exits to China, India, Islamic Republic of - 75 -
Iran, Pakistan and Turkey constrain the development of domestic automobile transport. Yet, the domestic road system is extremely important for internal transport as it accounts for 74% of all domestic freight transport (Kazakhstan Statistics 2001). Rail Kazakhstan’s international transit trade depends heavily on its ageing and badly maintained rail system. This includes 13,600km of rail lines of which 5,500km are double-track and some 4,000km are electrified. Rolling stock and spare parts need to be imported from Russia and Ukraine and are in short supply (EIU 2002). The country recognizes the importance of international rail connections and has been actively expanding its network. With the opening of the Druzhba-Alashankou and Tedjen-Serakhs- Meshed transit routes, Beijing is now connected via Almaty to Istanbul as well as Western Europe. This transport corridor could potentially rival the Trans-Siberian railway and maritime routes. Rail traffic to China, however, is complicated by a difference in track gauge standards. This requires border terminals for changing the wheels on carriages. To that end, the Kazakh government has opened a new terminal in Druzhba in 1998 to facilitate transshipments to China. Pipelines Kazakhstan still relies heavily on the pipeline system that was designed during the Soviet Union to ship Kazakh oil from the Western part of the country to Russia and to bring Russia’s Siberian oil to Kazakh refineries. Unfortunately, the design of this system now requires Kazakh oil and gas exports to traverse the territory of two of Kazakhstan’s competitors in the global energy markets, Russia and Iran. Several efforts are underway to reduce this reliance. The first is the new Caspian Pipeline Consortium pipeline built in 2001 to transport oil from the west of the country to the Black Sea. The pipeline is expected to initially carry 28 million tons per year with a potential for 67 million (KIPC 2000). However, most Black Sea traffic needs to pass through the Bosporus. This narrow waterway may impose constraints on the overall amount of oil that can be shipped to the Mediterranean. To date it is not clear how much of a constraint the narrow Bosporus may be on scaling up Kazakh oil production. The other effort is a proposed pipeline to China. Turkmenistan and Kazakhstan have signed a $9 billion contract with China to develop this pipeline (Nazar et al 1999). Production costs in Kazakhstan’s future Caspian Sea offshore fields are likely to be as high as $8/barrel – compared with $3/barrel in the Persian Gulf. Export pipeline fees through the Caspian Pipeline Consortium add another $3.6/b to the cost of production 28 . It is estimated that these fields will probably need to earn $15/b to break even (EIU 2002). Ports/Waterways The length of water routes in Kazakhstan is significant at around 6,000 kilometers. The Irtysh is the main navigable river in the country, accounting for about 80% of cargo transported by river. The Caspian is increasingly used for international shipment of dry cargo, crude oil and 28 This compares very favorably with the cost of rail transport ($7/barrel) - 76 -
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THE CHALLENGES FACING LANDLOCKED DE
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to link to global markets. In doing
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TABLE OF CONTENTS EXECUTIVE SUMMARY
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PART 1: INTRODUCTION AND BACKGROUND
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First, landlocked countries are dep
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together a wide variety of sources,
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infrastructure. In these cases the
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1.2.3. VULNERABILITY TO CIVIL CONFL
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the Central African Republic - Came
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1.3 INDICATORS OF DEVELOPMENT 1.3.1
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• The southern African landlocked
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PART 2: COUNTRY CASE STUDIES - 18 -
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Internal transport networks in the
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Ports Although Botswana’s geograp
Page 29 and 30: POLITICAL RELATIONS Lesotho’s int
Page 31 and 32: elatively better quality than most
Page 33 and 34: SWAZILAND Despite being landlocked,
Page 35 and 36: ZAMBIA While Zambia shares its bord
Page 37 and 38: Relations with South Africa have be
Page 39 and 40: Zimbabwe’s extensive rail network
Page 41 and 42: TRANSIT ROUTES OF ETHIOPIA The land
Page 43 and 44: UGANDA Uganda’s location allows i
Page 45 and 46: POLITICAL RELATIONS The formation o
Page 47 and 48: section on Uganda. The Central Corr
Page 49 and 50: BURUNDI In addition to lying over 1
Page 51 and 52: In 1996, after Major Pierre Buyoya
Page 53 and 54: Recognizing the dramatic effects th
Page 55 and 56: AFRICA - WESTERN TRANSIT ROUTES OF
Page 57 and 58: of transit. In fact, the landlocked
Page 59 and 60: only hindering normal road traffic
Page 61 and 62: CENTRAL AFRICAN REPUBLIC With only
Page 63 and 64: Relations with the eastern neighbor
Page 65 and 66: TRANSPORT INFRASTRUCTURE Road While
Page 67 and 68: MALI Upon declaring independence in
Page 69 and 70: Finally, and most importantly for M
Page 71 and 72: TRANSPORTATION INFRASTRUCTURE Road
Page 73 and 74: ASIA - CENTRAL TRANSIT ROUTES OF CE
Page 75 and 76: TRANSIT ROUTES OF MONGOLIA As part
Page 77 and 78: AFGHANISTAN Two decades of war, har
Page 79: Afghanistan, the first by an Irania
Page 83 and 84: KYRGYZSTAN Over 3600 km from the ne
Page 85 and 86: POLITICAL RELATIONS Generally recog
Page 87 and 88: The country’s two major highways,
Page 89 and 90: TURKMENISTAN With direct access to
Page 91 and 92: Ports and Waterways Turkmenistan ha
Page 93 and 94: Domestic transport is hampered by t
Page 95 and 96: MOLDOVA Although the former Soviet
Page 97 and 98: MONGOLIA As the landlocked country
Page 99 and 100: CAUCASUS TRANSIT ROUTES OF THE CAUC
Page 101 and 102: ARMENIA While Armenia’s central g
Page 103 and 104: With the closure of the Turkish and
Page 105 and 106: worse (World Bank 2000). In fact, w
Page 107 and 108: ASIA - SOUTH & SOUTH-EAST TRANSIT R
Page 109 and 110: With the exception of western Afric
Page 111 and 112: and exports pass through the port p
Page 113 and 114: Khai (at the Thai-Laos border) to t
Page 115 and 116: NEPAL Due to the Himalayan range to
Page 117 and 118: More recently, India delayed the au
Page 119 and 120: links to the railways of Argentina,
Page 121 and 122: developing the nation’s road infr
Page 123 and 124: PARAGUAY Dependent primarily on tra
Page 125 and 126: BOPS Break Bulk CAN CAR CEEAC/ECCAS
Page 127 and 128: GENERAL ADB (2002). Annual Report 2
Page 129 and 130: United Nations General Assembly (20
Page 131 and 132:
BOTSWANA CountryWatch (2003). Botsw
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EIU (2002). Malawi Country Profile
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ZAMBIA Chikoti, V. (?). Overview of
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AFRICA - CENTRAL AND EASTERN BURUND
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EIU (2002). Ethiopia Country Report
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Mutumba-Lule, A. (2001). 17 Firms V
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Page 145 and 146:
Jean-Bertin, O. (2002). Burkina Fas
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Evlo, K. (1995). Transit Transport
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ASIA - CENTRAL United Nations (1994
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UNESCAP (2002). Afghanistan: Status
Page 153 and 154:
EIU (2001). Railways in Kyrgyz Repu
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Spiegel Online (2002). Moldawien, S
Page 157 and 158:
USDA FSA (2002). Tajikistan Shippin
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CAUCASUS ARMENIA Armenia Foreign Mi
Page 161 and 162:
World Bank (2000). Project Appraisa
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World Audit (2001). World Democracy
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MONGOLIA Canning, D. (1998). A Data
Page 167 and 168:
WDI (2002). World Development Indic
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UN DHA (1997). Paraguay El Niño Fl
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Map 1
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Table 2: Human Development - Rankin
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Table 4: Exports per Capita (2000 c
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Figure 1: Human Development Indicat
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