China and Russia push forward on port, rail projects despite slowing economies
Chinese investors aren’t scaling back on freight projects in Russia even though both countries’ economies are suffering, according to Russia’s minister of Far East development.
The statements from the official spokesperson of minister Alexander Galushka come after various reports, including in The Economist and New York Times, noted how the duo’s trumpeted partnership in trade has fallen short of expectations. The reports noted how Russian bureaucracy and lower demand have blunted Moscow’s eastern development push.
Even so, the new-found friends are pushing forward on the construction of two container terminals as part of the Primorye-2 project, a transport corridor linking the ports of Northern China with the EU region via Russia’s Far East seaports.
China Merchants Group and its Russian partner, Summa Group, are on track to build the Zarubino seaport on the south of Primorsky Krai in the Trinity Bay. The final agreements to build the $300 million port with an annual capacity of 500,000 twenty-foot-equivalent units are expected to be signed by the end of March. Port backers expect up to 60 percent of throughput at the port will originate from China.
Zhong Xin Gong Co. and Tranzit-DV, one of Russia’s largest transport companies, plan to build a container terminal in the Slavyanka seaport, also in the Primorye Territory. The terminal, which will have a capacity of 500,000 TEUs annually, will be completed in 2018.
On the inland side, Chinese investors aim to link the Chinese border city of Suifenhe with the Grodekovo station and Russia’s Far East ports via a 200 billion ruble ($3 billion) rail line.
The road, construction of which is expected to start in the second half and be completed in 2018, may provide the shortest route to Central Asian markets via the new port infrastructure in east Primorye.
China Outbidding Germany to Build Russian High Speed Rail
The Russian Railways company (RZD) is not satisfied with cooperation terms for the construction of Russia’s high-speed railway (HSR) Moscow-Kazan suggested by the German Initiative consortium, RZD vice-president for high-speed railway development said on Tuesday.
“The German Initiative offered a memorandum of cooperation and equipment import investment,” Alexander Misharin told TASS. “We are analysing the proposals, but their equipment supply funding offers do not satisfy us.”
The Russian Railways official noted that the prices for some equipment were too high. “Moreover we cooperate with Chinese counterparts who have the same equipment for more appropriate prices,” Misharin said.
While citing president and CEO of Siemens in Russia and Central Asia, vice-president of Siemens AG Dietrich Moeller, TASS reported earlier that the German Initiative – a German consortium led by Siemens – may join the Russian high-speed railway project as a co-investor along with Chinese investors
According to Moeller, the amounts of funding previously agreed with China would not be sufficient for the entire project. He said the consortium is considering co-funding the project in one of its segments, rolling stock supplies. Other possible areas in which Siemens might be interested are signaling, traffic control and power supply systems.
He said the company is prepared to offer new generation of Sapsan trains which could be produced at a JV plant with Sinara.
Currently, Siemens is partnering with Sinara on building rolling stock for Russian Railways. The JV plant Ural Locomotives is building freight locomotives and Lastochka EMUs.
Russia’s first Moscow-Kazan HSR is estimated to cost 1.068 trillion roubles ($17 billion). The length of the route will be about 770 km. With trains running at the speed of up to 400 km/h the travel time on the route from Moscow to Kazan will be reduced to 3.5 hours from current 14 hours.