Şerafettin Aras – UND Chairman of the Board

Recently, an agreement was signed between Chinese BYD, one of the world’s largest automotive companies, and the Ministry of Industry and Technology, envisaging an investment of approximately 1 billion dollars in Turkey. This investment in our country by China, the world’s largest vehicle exporter and electric car manufacturer, will be a tremendous gain for our country’s economy. It is stated that BYD, which produces approximately 3 million cars annually, will be able to expand into the European market more easily through our country, especially by producing electric and rechargeable hybrid cars. Following this agreement, it came to the fore that other Chinese vehicle manufacturers also had plans such as establishing a production line in Turkey, bringing the spare parts supply system to Turkey and “positioning Turkey as a gateway to Europe”.

On the other hand, the Belt and Road project, which is calculated to increase our country’s exports by at least 15% with the investment and financing opportunities it will provide, was implemented by China to connect Asia, Europe and Africa with a network of highways, railways, ports and other transportation infrastructure projects. Since 2013, it continues to play an important role in global trade.

It was announced that the trade volume between China and the countries on the Belt and Road route reached approximately 2.75 trillion dollars, with the transportation projects implemented thanks to the program carried out by China in cooperation with more than 150 countries and more than 30 international organizations, which constitute half of the world’s gross product. According to the World Bank, the Belt and Road Initiative has the potential to reduce global trade costs by 1.8%.

However, the Europe-Asia supply chains, which got into even greater trouble with the Suez Canal crisis that started in October last year, forced the shifting of 70% of the transportation from the Red Sea to the Cape of Good Hope route, and the delivery times extended by at least 25-30 days, as well as the acceleration of the ships, In this way, it faced the problems of increasing fuel consumption and the need for more ships and personnel.

Developments in the region seem to have neutralized the IMEC corridor, a weak US-EU supported alternative, and necessitated the Caspian International Transport Corridor Middle Corridor to be included in the immediate focus of the Global Gateway initiative, which until then had been observed to have concentrated on investment projects for Africa.

According to calculations, while the transit time between China and Europe is 19 days in the Northern Corridor, which is dominated by Russia, and 22-37 days in the Southern Corridor, which is dominated by maritime transportation, it can be reduced to 12 days if the Central Corridor is developed and cleared of problems.

Within the scope of the EU Global Gateway initiative, funds worth EUR 10 billion were mobilized under EU leadership for infrastructure and logistics projects aimed entirely at activating the Central Corridor in Central Asia. China, on the other hand, promised 4 billion dollars of financial support for logistics and infrastructure projects in the same region.

These developments indicate that a strategic competition between China and the EU is intensifying in the Eurasian region. While China has committed to a total investment of 1 trillion dollars for the period 2013-2022 within the scope of the Belt and Road project, only 300 billion EUR in total has been committed on the EU side for investments in the fields of education-research, health, climate, energy and digitalization, as well as transportation, until 2027. However, what is clear is that China and Europe have common interests and goals for strengthening the Central Corridor.

The International Road Transport Union (IRU), of which UND is an active member, has been trying to open new efficient corridors for China-Europe trade by activating the TIR system, with its projects supporting the “Modern Silk Road” concept since the early 2000s. In 2023, a total of 15 new TIR transport corridors from China to Afghanistan, Mongolia, Central Asia and Pakistan were activated with demonstration transports led by IRU. Most recently, TIR Green Lines, which provide fast passage for TIR transportation at Turkmenistan’s ten border gates with Afghanistan, Iran, Kazakhstan, Uzbekistan and also at the Turkmenbashi international port, were put into practice. It is estimated that thanks to these lines, transportation will be accelerated by 80% and transportation costs will be reduced by 50%.

On July 25 this year, for the first time, a truck loaded with automobile spare parts set out from China and carried out a transportation operation to Turkey within the scope of the TIR system. When a truck departing from China’s Korgos border gate reached Kazakhstan’s Kuryk port, it boarded the Ro-Ro to Azerbaijan and set out to reach Istanbul via Georgia, at a ceremony attended by the presidents of China and Kazakhstan. When the 4800 km transportation carried out under the IRU organization is completed, the transportation between China and Turkey, which takes between 30-40 days by sea, will be reduced to 19 days.

The Middle Corridor promises great gains for Türkiye’s logistics sector in China-Central Asia-Europe trade. In addition, the Development Road project, which was announced by our President last year and will connect the Persian Gulf to Europe via Turkey, is also considered as a “strategic initiative” that will contribute to the increasing value of the Central Corridor, with a transit time of at least 10 days compared to, for example, the Suez Canal in Asia-Europe trade. has the potential to provide advantages.

On the other hand, as stakeholders of the Turkish logistics industry, we should not fall into this misconception. Apart from the corridors passing through Turkey, international traders are constantly searching for alternative routes through which Europe-Asia trade can be transported in a shorter time and at lower costs.

One of them is the Caspian-Black Sea corridor project, which, after reaching Georgia from Central Asia, bypasses our country and connects to Romania via the Black Sea, and from there to the rest of Europe.

While the work of the route countries towards the development of the corridor in question continues at full speed, it was finally decided to sign a four-way intergovernmental agreement between Azerbaijan, Georgia, Romania and Turkmenistan in July for the establishment of the Caspian-Black Sea corridor.

On the other hand, although the India-Middle East-Europe Corridor (IMEC) is considered to have been shelved due to conflicts and security concerns in the region, contacts between the UAE and India, and some EU countries with India and the Gulf countries, regarding the possibilities of realizing this corridor continue. Russia, on the other hand, continues its studies and contacts regarding the development of the North-South Transport Corridor, designed to reach India and Northern Europe via Iran and Azerbaijan.

All these efforts encourage us, as stakeholders of the Turkish logistics industry, to make the best use of the conditions we are in, but above all, by taking the necessary measures within our own borders urgently; It forces us to add capacity and operational speed to all our border crossings from west to east, to enable the uninterrupted processing of China-Europe trade, whose trade volume is expected to triple by 2030, to facilitate transit transportation transactions and to establish our intermodal logistics centers as soon as possible.

Of course, one of the conditions for the uninterrupted operation of the European leg of the Central Corridor is that our rights already acquired within the scope of the Customs Union in Turkey-EU transportation are given back to us; Turkish transporters carrying the Turkey-EU and EU-Central Asia trade will be freed from quotas and discriminatory fee restrictions in transit transportation, and our professional truck drivers who “provide services” to this trade will be freed from visa problems. I would like to take this opportunity to remind once again that the strength of all supply chains is limited to its “weakest link”.