Erlan Abdyldaev, specially for IPP
A peculiar jubilee will be celebrated in December 2006 – ten years since instantiating construction of the Chinese-Kyrgyz-Uzbek trunk-railway. During this period the three states undertook vigorous efforts to come to an agreement with each other about various aspects of designing and constructing the transportation corridor which would have connected China along a new route with Europe and Middle East through Central Asia.
Their was a particular urgency about the issue for Kyrgyzstan, Uzbekistan and China in the latter half of 1990s. It was on the agenda for negotiations at various levels between the three states including the top leadership. At the same time, the parties have made numerous declarations highlighting the launch of the “project of the century”. Though they never started or even approached constructing the main railway. This lack of progress piques a natural interest both in the states involved in the project, the neighboring states and those states with political, economic and other interests in Central Asia. What is the reason behind this protracted process? Is there the possibility of eventually turning the idea into reality?
Project History. The most active phase of work on the project was in the late 1990s. The first meeting of representatives from transportation agencies for the three countries to discuss the issue of conducting research and pre-design work on construction of a new Kashgar-Osh-Andijan trunk-railway took place in Tashkent in December 1996. As a result of the initial meeting, the parties agreed on the following: “Taking into account the decision made by the People’s Republic of China on construction of a new Korla-Kashgar trunk-railway with the total mileage of 970 kilometers, which anticipates completion of all work by 2000 (this section was successfully completed by the target date), and commencement of service along the newly constructed Tedjen-Serahs-Mashhàd Railroad, creates the basis for construction of a southern spur line of intercontinental trunk-railway, which connects in the shortest route ports on the east of PRC with the states of the Middle East and Southern Europe through the states of Central Asia… The parties, considering the importance of the issue, expansion and strengthening of good-neighborly relations and economic ties between PRC, Kyrgyzstan and Uzbekistan, consider it expedient to undertake all required research and pre-design work along all possible directions of the route….”
China, Kyrgyzstan and Uzbekistan signed a protocol on institutionalizing the work on the project in a trilateral format. Through creation of a joint working commission in April 1997, this protocol was created during a symposium called “New Transeuroasiatic Bridge” devoted to the construction of the China-Kyrgyzstan-Uzbekistan Railroad in Tashkent. Representatives of about twenty countries, international and regional financial organizations have also participated in this symposium; the commission was headed by Vice-Prime Ministers of Kyrgyzstan and Uzbekistan, and Deputy Minister for Railroads of China.
The first meeting of the joint working commission was held in Bishkek in November 1997. During the commission’s early work, the parties were able to come to a common understanding about a number of issues. Although the main issue – the option for the passage of the future route remained unresolved. As a result, the parties decided to set up a trilateral joint expert working group. The task of the working group was to draft a preliminary technical and economic assessment along two directions – southern and northern options for the passage of the trunk-railway.
During the 1998-2000 timeframe, specialists from the three states actively studied northern and southern options by visiting the sites. Chinese and Uzbek sides suggested adopting the southern option through Irkeshtam check-point, while the Kyrgyz side favored the northern option through Torugart check-point.
The second meeting of the commission was held in 2001 in Beijing. At that time, the Chinese and Kyrgyz sides basically agreed on the northern optimized option through Torugart as the basis for construction. The Uzbek side, after failing to secure a favorable southern option, officially decided that it would take a neutral stand.
After the second meeting of the commission when fundamental differences among the parties on the itinerary for the passage of the route emerged again, the interest in the project on the part of Uzbekistan and later China gradually started fading away. Notwithstanding numerous and desperate efforts of Bishkek to continue the project and make an attempt to bring together the two other sides, it did not work out. Experts from Uzbekistan stopped participating in working meetings and the work of the joint commission was forced into a bilateral format between Kyrgyzstan and China.
Chinese and Kyrgyz sides declared the completion of the work on the comprehensive study of the construction of the Chinese-Kyrgyz-Uzbek Railroad with the northern optimized option in December 2003 in Beijing.
No significant breakthroughs in advancement on this project have taken place since December 2003.
As the new President Bakiev came to power, attempts were made to reanimate the project. During his official visits to PRC and Uzbekistan in June and October 2006, Bakiev strove to enlist the support of the top Chinese and Uzbek leadership. However both Beijing and Tashkent did not speak unambiguously on this issue. In their joint statement as a result of President Bakiev’s visit to China, the sides declared that they would continue the project. As a result of Bakiev’s visit to Uzbekistan, the issue of the trilateral railroad partnership did not even make it to the final statement.
The main conclusion drawn by Chinese and Kyrgyz experts in the Comprehensive Report is that from a technical point of view construction of the Chinese-Kyrgyz-Uzbek Railroad along the northern optimized option is quite feasible. Notwithstanding a relief difficult to access, there are no insurmountable obstacles. The experts’ conclusion was also based on the experience of Chinese railroad constructors, who, at that time, were speeding up construction of the Qinghai-Tibet Railroad (QTR), the highest-altitude and longest railroad in the world with a total mileage of 1,956 kilometers at a height of over 4,000 meters. Construction of QTR was successfully completed and the first train was launched on July 1, 2006. Mr. Sun Yunfu, the Deputy Minister for Railroads of China, who initially was the Co-Chairman of the joint commission on construction of the China-Kyrgyzstan-Uzbekistan Railroad, headed the QTR construction project.
Chinese and Kyrgyz experts identified the issue of funding as the main problem hindering forward movement in the Comprehensive Report. According to preliminary estimates the Kyrgyz section alone, with total mileage of approximately 250 kilometers, requires over one million U.S. dollars. Economic efficiency of the railroad was identified by the experts as the second problem. By the specialists’ calculations, in order to both repay the investment in 10-15 years and operate the railroad at a profit, it is necessary to allow no less than five million tons of freight per year. (By comparison, after more than 15 years of work, the volume of freightage through Druzhba-Alashankou, at the Kyrgyz-Chinese border, is barely approaching 10 million tons. Energy resources and ores of non-ferrous and ferrous metal make up the bulk of the freight).
Having completed the work on the Comprehensive Report and expressed the arguments in support of and against the project, the experts handed over the final decision to the political leadership of their states. However, a final coordinated decision on this project by the political leadership of the three states has not been made. China has the decisive vote in moving to implement the project.
Analysts from a number of states have expressed various opinions and operating assumptions regarding the the existing obstacles and the prospects of the railroad coming to fruition. It could be seen in the positive interests of Beijing to strengthen and consolidate its position in Central Asia as well as bind itself to Uzbekistan and Kyrgyzstan through trunk-railroad construction. Though the Chinese leadership has a number of outstanding concerns. The decisive concern for Beijing is, probably, the instability of the political situation in these two Central Asian states. The Ferghana Valley hosts a number of unresolved, volatile problems in both domestic politics in Kyrgyzstan and Uzbekistan. With intergovernmental and regional significance, radical Islamists could gain momentum and unite with Xingjian separatists. These trends do not give Beijing an impetus to speed up this project without resolving these issues first.
In the context of making decisions on implementing such large projects, China proceeds from the standpoint of friendly relations with the political leadership in both Kyrgyzstan and Uzbekistan. However there are issues in this regard as well – periodically emerging disputes regarding the Kyrgyz-Chinese border in Kyrgyzstan and the mercurial quality of Uzbekistan’s foreign policy. The Chinese leadership is not confident about the stability of the political situations in Kyrgyzstan and Uzbekistan. It is not interested in tying its explosive Xingjian to the unstable situation in the Central Asian states and risking changes in the foreign policy passions of local political elites.
According to a number of experts, the global war on terrorism waged by the U.S. beginning in 2001 also had a negative effect on the prospects of implementing this project. By the U.S. including Iran on the list of states that support terrorism and the recent emergence of the Iranian nuclear problem have made the transit of freight through Iran problematic. This backdrop makes the idea of the Chinese-Kyrgyz-Uzbek Railroad route for shorter access from China to Europe and the Middle East questionable.
There are also quite well-founded doubts in the future competitiveness of the new railroad transport passage compared to the existing routes through Russia and Kazakhstan and to sea shipping as was noted above from the point of security, stability and reliability. Russia and Kazakhstan, as well as other states, which presently control these transport flows are not interested in implementation of this project. In fact, they will likely take various steps in order to hinder it or at a minimum, further decrease its investment attractiveness. Today, Russia is investing its own significant funds into improving the infrastructure of the Trans-Siberian Railroad by reducing freight rates and transit time through their territories as well as guaranteeing safety and the preservation of freight. In 2003 Kazakhstan announced a vast construction scheme for a Trans-Kazakh narrow-gauge line with the total mileage of several thousand kilometers which they were undertaking with significant capital expenditures.
Over ten states along the route from China to Europe and through the Middle East could become another important problem, creating insurmountable obstacles in the implementation of the project. It is necessary to coordinate a number of elements related to visas, systems of various permits, tariffs, and other issues connected with the transit of passengers and freight. Given the multi-directional domestic and foreign policy courses of the states involved, which are often contradictory and the presence of a significant number of intergovernmental problems at various levels, the coordination process could take decades. The recent delay with implementation of the Transport Corridor Europe-Caucasus-Asia project, a quadruple agreement between Pakistan, PRC, Kyrgyzstan and Kazakhstan (1996) on traffic highway service and a number of other regional transport projects with more than two states as parties, is illustrative of the potential for problems.
All of the abovementioned problematic aspects of constructing a new Transeuroasiatic transport corridor appear to be outside the borders of Kyrgyzstan. Meanwhile, even in a hypothetical situation whereby all of the issues could be resolved in a timely manner, which is unlikely according to experts, the most complicated problem is the internal situation. Domestic political instability and the uncertainty in the country, a generally weak economy and slow rates of socio-economic development plague the country. As a result, the investment appeal of this project is problematic for foreign investors. Obviously, it would have a significant domestic, socio-economic and international importance to Kyrgyzstan. However, the country lacks the internal financial reserves and independent sources for railroad construction. This predicament implies only one option – foreign borrowing from those states and institutions which have purely political or strategic interests in this project other than economic.
At the present time, there is only one state which has openly stated that under certain terms it is ready to provide Kyrgyzstan with funds on a bilateral basis for the construction of the Kyrgyz section of the railroad: China. Beijing has not elaborated on the terms under which it is ready to provide funding. Bearing in mind China’s interests and experience in Central Asia, it is likely that the terms will not be simple for Kyrgyzstan. At a minimum, they will demand from the Kyrgyz leadership a thorough and weighted study of all project scenarios and the political will in making the final decision. The hopes of the Kyrgyz leadership to implement this project within the stated regional economic cooperation of the Shanghai Cooperation Organization will unlikely materialize due to a mismatch in the economic approaches of the Russian Federation and PRC within the framework of the Organization. Plus as mentioned above, due to the competition of this trunk-railway with the Trans-Siberian and the Chinese-Kazakh railroads.
Taking into consideration the aforementioned slew of issues, the prospects of the Chinese-Kyrgyz-Uzbek trunk-railway are indefinite and bleak as it was originally envisioned at the beginning – constructing a new Transeuroasiatic railroad from Shanghai to Paris. With this projection, it sounds like utopia rather than reality. According to a number of experts, with the goal of minimizing the influence of externally unfavorable factors, it would be more feasible to view this project as regional, initially connecting PRC with Central Asia along the new northern route. However, even with this projection, implementation of the project will likely be possible only under complete political stability and security in Kyrgyzstan and Uzbekistan, and after establishing sustainable and mutually beneficial political and economic relations between PRC, Kyrgyzstan and Uzbekistan. Additionally, to entice China further, it would take the emergence of lucrative economic projects in Kyrgyzstan and Uzbekistan primarily in the mineral industry. Without resolving these lingering problems it is likely that we may celebrate many more “jubilees” of studies and discussions, not the real implementation of the construction of the Chinese-Kyrgyz-Uzbek Railroad.
Erlan Abdyldaev, IPP expert, former Ambassador of the Kyrgyz Republic to PRC
