An Inside Look At The New Crossroads Of Eurasia: Azerbaijan’s New Port Of Baku

Wade Shepard

The place was literally and figuratively a crossroads. It wasn’t just the point where north-south highways and rail lines met their east-west compliments but the turning point of an entire nation going in a new direction.

Extending out from the west bank of the Caspian Sea, the New Port of Baku at Alyat sits within 20 square kilometers of barren brown desert that’s become fertile ground for some very big dreams. Positioned 65 kilometers south of the central core of Azerbaijan’s capital city of Baku, the new port is emerging as a full-fledged intermodal transportation hub and free trade zone that’s primed to become a major station along the New Silk Road — the nascent grid of enhanced economic corridors spanning the Eurasian landmass, from China to Europe.

The creation of this new logistics junction isn’t just a move to keep in step with the times but is one that is being taken out of absolute necessity: Azerbaijan has roughly 30 years of oil left, and the country is placing an all or nothing bet on its newly emerging transportation economy. Starting in the 2000s, Azerbaijan embarked upon a national program to rejuvenate its transportation infrastructure in a bid to renew its ancient relevance as a key logistical node in the heart of Eurasia. New highways and rail lines were laid across the country, and in 2007 it was decided to take the initiative a little further and move the Port of Baku, which at that time sat in the crowded city center, out to the town of Alyat, where it would be right at the crossroads of Azerbaijan’s main transportation corridors — in a place where there was nothing if not room to grow.

This new port was set up to be the center of Azerbaijan’s new logistics economy and the predominant driver of its broader economic diversification initiative. It was to become a Caspian Sea port, a road and rail transport terminal, and a free trade zone all rolled into one and administered under the umbrella of its own special legal regime.

“We don’t view the Port of Baku as just a port,” explained Taleh Ziyadov, the port’s Cambridge-educated director-general. “It is a project that we believe is not only going to have one of the major contributions to Azerbaijan’s non-oil economy and diversification but also have a transformational impact on the region as a whole.”

The new port and FTZ at Alyat is currently a main station along the Transport Corridor Europe-Caucasus-Asia (TRACECA), which connects Europe with Central Asia and China, and is also a key stop on north-south transport routes which link Russia with the Middle East and Indian Ocean. The New Port of Baku is attempting to establish itself as a middle of the world type of place — a “hub of hubs” where Russia, Iran, Europe, Central Asia, the Caucasus, and China can be linked together.

As in the days of the ancient Silk Road, a new network of logistics, trading, and manufacturing centers are emerging across Eurasia in places such as Khorgos and Aktau in Kazakhstan, Anaklia in Georgia, Bandar Abbas in Iran, Terespol municipality in Poland, and Chongqing, Chengdu, and Lanzhou in China. Only this time rather than being built around trade markets they are being built around ports. New sea and dry ports are being leveraged as economic drivers that can support not only logistical functions but also entire commercial, industrial, and residential ecosystems — i.e. entirely new cities.

The dominant model for this type of transport-oriented development is clearly the Jebel Ali Free Zone (JAFZA) in Dubai — a booming economic zone that was intentionally built “in the middle of nowhere” around a port that sparked the creation of an entirely new, multi-faceted, and economically dynamic urban area in a matter of decades. From the Kazakh borderlands of China to the eastern fringes of Europe, I’ve heard government officials, port directors, developers, and CEOs state proudly that they are building “new Dubais.” At the New Port of Baku, the mission is very much the same.


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