III КВАРТАЛ 2022Г. - 55 баллов
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[DETAIL_TEXT] => The article represents an analysis of the current tariffs formation system on the Russian Federation railway transport in the light of its effect on the development of competition on the freight transportation market, with certain suggestions as to its improvement.
General tariff regulation principles
The system of tariffs regulation in Russia implies the state interference with the tariffs regulation, as provided by the paragraph 8 of the Federal Law "On the Railway Transport in the Russian Federation" and is due to the high degree of monopolization of the railway transport market.
On 28 August 2003 there was introduced the new Price No10-01, on which the tariff system for the domestic, export and import freight transportation is based. The new Price takes into account the requirements for the tariffs formation in the competitive conditions on the railway transport market.
The carriages component in the structure of tariffs averages 15%. There has been determined the fee for using the railway infrastructure. Therefore the tariffs for carriers using own (private) carriages and locomotives are some 45% less than for transportation using the RZD rolling stock and locomotives.
The new Price No 10-01 provides for the significant reduction of the tariff load by long-haul transportation, first of all for the shippers from the Far East, Urals, and Siberia.
The regulating bodies have been working on adjusting the transportation tariffs indexes in accordance with the inflation level. Thus the "contribution" of the railway transport (as well as of the other natural monopolies) into the general inflation dynamics has been brought to the minimum.
In 2003-2004 the annual tariffs indexation constituted 12%, which corresponds to the inflation rate. Next year the tariffs indexation will also remain within the inflation level.
This allows the businesses to plan the railway transportation-related costs.
The principle of flexible tariffs regulation remains in force. About 9% of the total volume of cargoes carried by rail are transported at exclusive tariffs every year. Discounts allowed to attract 12 mln. tons of additional cargoes a year.
In the sphere of passenger transportation in 2003-2004 there was applied the principle of flexible seasonal tariffs regulation within the index range of the 12% annual average.
Regulating bodies and tariff systems
The RF President order No 314 in March 2004 on the new structure of the federal executive power bodies along with some other federal bodies eliminated the RF Ministry of Railway and restructured the RF Federal Energy Commission (FEC). The Government Regulation eliminated the Government Commission on the Matters of Tariff Regulation on the Railway Transport. FEC is reorganized into the Federal Tariffs Service (FST).
Thus, as a result of the administrative reform and according to the Statute the Federal Tariffs Service has undertaken the function of regulating tariffs for railway freight transportation in the domestic, export and import communication; while the RF Ministry of Transport carries out the tariffs regulation for cargoes moved in the transit mode.
Decisions on these matters are characterized by complex approach and are taken by the Work Groups on the tariff policy issues that include representatives of all the federal bodies concerned and the RZD representatives.
The major documents regulating the tariffs and dues calculation are the corresponding Tariff Regulations and the Russian Railways Tariff Policy.
The Tariff Regulation No 1 (Price No 10-01) establishes the rules for tariffs calculation for all transportation modes except the transit mode. The tariffs set in the Price No 10-01 depend on the cargo type (there are 3 tariff classes), type of rolling stock, carriages loading, distance of transportation, kind of communication. Thus the tariffs formation is based on two factors - the transportation prime cost and the demand elasticity. The existing tariffs differentiation depending on the cargo type and the transportation distance is to create equally favourable conditions for the railway transport users in the part of the transport component index.
The Tariff Regulations No 2 and 3 regulate, respectively, payment for carriages and fees for additional operations related with cargoes railway transportation. They are currently under development and the matter of their application is not settled yet, as the new Railway Transport Statute rules the given tariffs application on the basis of contractual relationship, unless otherwise provided by the law.
The new Price No 10-02-16 establishing tariffs for passenger railway transportation is currently under development.
Introducing amendments and additions into the Tariff Regulations No 1,2,3, Price 10-02-16, offering exclusive tariff conditions for all transportation modes except the transit one is to be carried out by means of the RF FTS resolutions.
The Tariff Regulation No 4 establishes the rules for determining the shortest tariff distance, contains the list of stations, halts, stops and information on the operations carried out by the stations mentioned.
Introducing amendments into the Tariff Regulation No 4 is to be carried out by means of the Federal Agency of Railway Transport's resolutions.
The Russian Railways tariff policy determines the rules for the tariffs calculation and their amount by moving cargoes in the transit mode, the tariffs are established according to the resolutions of the annual tariff conferences of the CIS states - members of the 1993 Tariff Agreement. The rates are fixed in Swiss francs and depend on the type of rolling stock, cargo type (there are adjusting coefficients), and transportation distance.
Introducing amendments and additions into the Tariff Policy is to be carried out by means of the RF Ministry of Transport resolutions.
In order to promote competition
The modification of the Price No 10-01 structure by increasing the carriage component up to the average of 15% attributed to creating the necessary prerequisites for increasing the share of owned rolling stock, as well as for the increase of sales by distanced enterprises by introducing reducing coefficients, which rise together with the increase of the transportation distance.
Still, the carriage component has not been allotted in respect to certain sections of the Price 10-01, related to the container cargoes tarification, export-import cargoes movement across the land borders. The Tariff Policy rates are not structured enough in this respect as well.
Besides, the increase of the own and rented rolling stock share by means of allotting the carriage component does not resolve the problem of carriers" competition on the market.
The carrier's activity implies not only owing carriages, but also the whole gamut of costs related to their operation, interaction with the infrastructure owners and with managing this activity.
That is why the infrastructure expenditures do not exceed 20-25% of the tariff in the tariff systems in the USA, Canada and the majority of European countries, which allows private carriers to really manage most of their overheads.
The Russian tariff system provides for allotting the carriage component (15%) and the locomotive component (30%). At that the infrastructure component comprises 55% of the total tariff.
Thus in Russia a potential carrier owing carriages and locomotives is to pay the infrastructure owner 55%, leaving the remaining 45%. With the limitation that a private carrier cannot set tariffs for transportation in own carriages that are higher than the tariffs for transportation in carriages in common use, its revenue will largely depend on the ability to cut the rolling stock and locomotives maintenance costs.
For comparison, the USA system (more comparable with its Russian counterpart in terms of transportation nature and conditions) allots 5 components in the tariff - administrative (12%), carriage (13%), locomotive (20%), operational (36%), infrastructure (19%).
With such a system a private company can function not only as the rolling stock and locomotives owners, but as an actual carrier capable of taking up the operational costs (e.g. for the locomotive crews, own technical personnel at the stations, equipment, repairs, maintenance en route, etc.) and the administrative costs including the own dispatching system. If these costs are taken up by the carrier, it has to pay the infrastructure owner only 19% of the tariff, while the rest it manages as well as it can, i.e. these costs can be optimized leaving the revenue greater than that from optimization of 45%. This means an economical mechanism of stimulating private carriers" interest in investing in rolling stock and the railway infrastructure elements.
On the other hand, such system makes the owners of infrastructure, owning at the same time rolling stock, cut costs for the infrastructure maintenance and operation, implementing advanced technologies of management and dispatching, systems monitoring the state of carriages and locomotives, cargoes movement tracking and other innovations, as all this can be done by competitors.
The system also entails the real possibilities for price competition. Managing 81% of costs and introducing resource saving technologies a private operator can reduce tariffs to gain customers.
At that, provided the carrying activity licensing has already started, carriers cannot make use of the flexible tariffs structure, they don't even have the necessary minimum to start operation.
The carrier activity should include the minimum of the whole gamut of initial-ending operations or some part of them, registering documents, owing offices (cashiers), accepting personnel, representatives on the border and port stations, etc.
Therefore the primary goal is the elementwise estimation of costs in the tariff initial-ending operations, elaboration of the infrastructure component for them by means of introducing the system of additional reducing coefficients taking into account the spectrum of operations carriers out by the carrier.
With the existing tariff formation system the efficient implementation of the following reform states is hardly possible.
At the same time, the single step reduction of the infrastructure component to the world standard of 20% may negatively affect the state of the infrastructure.
Therefore, the work on the further perfection of the Price 10-01 is to be carried out parallel to the optimization of the RZD management system, the system of costs managing, allotting the RZD competitive segments related with the repairs, technical maintenance, which means this will not be done in a day.
Nevertheless, the tariff system optimization should be of the proactive nature, as the world experience has no instances of a monopoly self-reforming and stimulating competition and management optimization by introducing economic mechanisms.
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[DETAIL_TEXT] => The article represents an analysis of the current tariffs formation system on the Russian Federation railway transport in the light of its effect on the development of competition on the freight transportation market, with certain suggestions as to its improvement.
General tariff regulation principles
The system of tariffs regulation in Russia implies the state interference with the tariffs regulation, as provided by the paragraph 8 of the Federal Law "On the Railway Transport in the Russian Federation" and is due to the high degree of monopolization of the railway transport market.
On 28 August 2003 there was introduced the new Price No10-01, on which the tariff system for the domestic, export and import freight transportation is based. The new Price takes into account the requirements for the tariffs formation in the competitive conditions on the railway transport market.
The carriages component in the structure of tariffs averages 15%. There has been determined the fee for using the railway infrastructure. Therefore the tariffs for carriers using own (private) carriages and locomotives are some 45% less than for transportation using the RZD rolling stock and locomotives.
The new Price No 10-01 provides for the significant reduction of the tariff load by long-haul transportation, first of all for the shippers from the Far East, Urals, and Siberia.
The regulating bodies have been working on adjusting the transportation tariffs indexes in accordance with the inflation level. Thus the "contribution" of the railway transport (as well as of the other natural monopolies) into the general inflation dynamics has been brought to the minimum.
In 2003-2004 the annual tariffs indexation constituted 12%, which corresponds to the inflation rate. Next year the tariffs indexation will also remain within the inflation level.
This allows the businesses to plan the railway transportation-related costs.
The principle of flexible tariffs regulation remains in force. About 9% of the total volume of cargoes carried by rail are transported at exclusive tariffs every year. Discounts allowed to attract 12 mln. tons of additional cargoes a year.
In the sphere of passenger transportation in 2003-2004 there was applied the principle of flexible seasonal tariffs regulation within the index range of the 12% annual average.
Regulating bodies and tariff systems
The RF President order No 314 in March 2004 on the new structure of the federal executive power bodies along with some other federal bodies eliminated the RF Ministry of Railway and restructured the RF Federal Energy Commission (FEC). The Government Regulation eliminated the Government Commission on the Matters of Tariff Regulation on the Railway Transport. FEC is reorganized into the Federal Tariffs Service (FST).
Thus, as a result of the administrative reform and according to the Statute the Federal Tariffs Service has undertaken the function of regulating tariffs for railway freight transportation in the domestic, export and import communication; while the RF Ministry of Transport carries out the tariffs regulation for cargoes moved in the transit mode.
Decisions on these matters are characterized by complex approach and are taken by the Work Groups on the tariff policy issues that include representatives of all the federal bodies concerned and the RZD representatives.
The major documents regulating the tariffs and dues calculation are the corresponding Tariff Regulations and the Russian Railways Tariff Policy.
The Tariff Regulation No 1 (Price No 10-01) establishes the rules for tariffs calculation for all transportation modes except the transit mode. The tariffs set in the Price No 10-01 depend on the cargo type (there are 3 tariff classes), type of rolling stock, carriages loading, distance of transportation, kind of communication. Thus the tariffs formation is based on two factors - the transportation prime cost and the demand elasticity. The existing tariffs differentiation depending on the cargo type and the transportation distance is to create equally favourable conditions for the railway transport users in the part of the transport component index.
The Tariff Regulations No 2 and 3 regulate, respectively, payment for carriages and fees for additional operations related with cargoes railway transportation. They are currently under development and the matter of their application is not settled yet, as the new Railway Transport Statute rules the given tariffs application on the basis of contractual relationship, unless otherwise provided by the law.
The new Price No 10-02-16 establishing tariffs for passenger railway transportation is currently under development.
Introducing amendments and additions into the Tariff Regulations No 1,2,3, Price 10-02-16, offering exclusive tariff conditions for all transportation modes except the transit one is to be carried out by means of the RF FTS resolutions.
The Tariff Regulation No 4 establishes the rules for determining the shortest tariff distance, contains the list of stations, halts, stops and information on the operations carried out by the stations mentioned.
Introducing amendments into the Tariff Regulation No 4 is to be carried out by means of the Federal Agency of Railway Transport's resolutions.
The Russian Railways tariff policy determines the rules for the tariffs calculation and their amount by moving cargoes in the transit mode, the tariffs are established according to the resolutions of the annual tariff conferences of the CIS states - members of the 1993 Tariff Agreement. The rates are fixed in Swiss francs and depend on the type of rolling stock, cargo type (there are adjusting coefficients), and transportation distance.
Introducing amendments and additions into the Tariff Policy is to be carried out by means of the RF Ministry of Transport resolutions.
In order to promote competition
The modification of the Price No 10-01 structure by increasing the carriage component up to the average of 15% attributed to creating the necessary prerequisites for increasing the share of owned rolling stock, as well as for the increase of sales by distanced enterprises by introducing reducing coefficients, which rise together with the increase of the transportation distance.
Still, the carriage component has not been allotted in respect to certain sections of the Price 10-01, related to the container cargoes tarification, export-import cargoes movement across the land borders. The Tariff Policy rates are not structured enough in this respect as well.
Besides, the increase of the own and rented rolling stock share by means of allotting the carriage component does not resolve the problem of carriers" competition on the market.
The carrier's activity implies not only owing carriages, but also the whole gamut of costs related to their operation, interaction with the infrastructure owners and with managing this activity.
That is why the infrastructure expenditures do not exceed 20-25% of the tariff in the tariff systems in the USA, Canada and the majority of European countries, which allows private carriers to really manage most of their overheads.
The Russian tariff system provides for allotting the carriage component (15%) and the locomotive component (30%). At that the infrastructure component comprises 55% of the total tariff.
Thus in Russia a potential carrier owing carriages and locomotives is to pay the infrastructure owner 55%, leaving the remaining 45%. With the limitation that a private carrier cannot set tariffs for transportation in own carriages that are higher than the tariffs for transportation in carriages in common use, its revenue will largely depend on the ability to cut the rolling stock and locomotives maintenance costs.
For comparison, the USA system (more comparable with its Russian counterpart in terms of transportation nature and conditions) allots 5 components in the tariff - administrative (12%), carriage (13%), locomotive (20%), operational (36%), infrastructure (19%).
With such a system a private company can function not only as the rolling stock and locomotives owners, but as an actual carrier capable of taking up the operational costs (e.g. for the locomotive crews, own technical personnel at the stations, equipment, repairs, maintenance en route, etc.) and the administrative costs including the own dispatching system. If these costs are taken up by the carrier, it has to pay the infrastructure owner only 19% of the tariff, while the rest it manages as well as it can, i.e. these costs can be optimized leaving the revenue greater than that from optimization of 45%. This means an economical mechanism of stimulating private carriers" interest in investing in rolling stock and the railway infrastructure elements.
On the other hand, such system makes the owners of infrastructure, owning at the same time rolling stock, cut costs for the infrastructure maintenance and operation, implementing advanced technologies of management and dispatching, systems monitoring the state of carriages and locomotives, cargoes movement tracking and other innovations, as all this can be done by competitors.
The system also entails the real possibilities for price competition. Managing 81% of costs and introducing resource saving technologies a private operator can reduce tariffs to gain customers.
At that, provided the carrying activity licensing has already started, carriers cannot make use of the flexible tariffs structure, they don't even have the necessary minimum to start operation.
The carrier activity should include the minimum of the whole gamut of initial-ending operations or some part of them, registering documents, owing offices (cashiers), accepting personnel, representatives on the border and port stations, etc.
Therefore the primary goal is the elementwise estimation of costs in the tariff initial-ending operations, elaboration of the infrastructure component for them by means of introducing the system of additional reducing coefficients taking into account the spectrum of operations carriers out by the carrier.
With the existing tariff formation system the efficient implementation of the following reform states is hardly possible.
At the same time, the single step reduction of the infrastructure component to the world standard of 20% may negatively affect the state of the infrastructure.
Therefore, the work on the further perfection of the Price 10-01 is to be carried out parallel to the optimization of the RZD management system, the system of costs managing, allotting the RZD competitive segments related with the repairs, technical maintenance, which means this will not be done in a day.
Nevertheless, the tariff system optimization should be of the proactive nature, as the world experience has no instances of a monopoly self-reforming and stimulating competition and management optimization by introducing economic mechanisms.
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[DETAIL_TEXT] =>
Starting point
As a result of the decision made, the Russian Railways System of Transport Services was founded in 1996. It has the following structure: the organization is headquartered in Moscow as the Russian Railways Center of Transport Services, its branches - the railway's centers of transport services - operate on each of the 17 railways, with their regional units - regional centers of transport services - functioning at the key stations of cargo flow formations.
From the very beginning of OAO RZD foundation, the Center of Transportation Services naturally became its part as a marketing and service-promoting department of the Russian Railways. The main responsibility of this department is the company's marketing policy development and promoting railway transportation services concerning cargo transportation.
Therefore, the System of Transport Services is the unique central structure that provides, on behalf of OAO RZD, for negotiations with clients at the stage of cargo transportation orders being settled and performed. The fulfillment of working contracts with private carriers, railway rolling stock operators, forwarding companies and other partners is also within the sphere of its responsibility. The System of Transport Services main functions are as follows: to organize cargo transportation performed by the railways, to operate railway transport infrastructure of common use belonging to OAO RZD for cargo transportation, information and other extra services, as well as to sell and rent the railway rolling stock.
Summing up the official statements it can be concluded that in practice the railway's centers of transport services operate as a mediator organization between the consumers and the producer, i.e. the railways, on behalf of the Russian Railways System of Transport Services. Such a mission predetermined the department's reformation in accordance with the company's new circumstances. As the basic principle chosen was that of sharing responsibilities, the production itself (cargo transportation) and the selling policy were divided.
What does this principle mean in practice? All the custom services, whose two main constituents are marketing and cargo transportation sales, will be performed exclusively by this department, the System of Transport Services. Speaking about the marketing constituent, it is comprised of objective predictions of the transportation market prospects, the investigation of potentially required transportation services, justification for cargo transportation tariffs and other services provided and the development of new services. As for the second constituent - cargo transportation sales - it includes providing services sales and equal quality service guaranteed for each customer as well as equal service availability, a standard list of services, unified price policy and on time payments.
At the board meeting held in April 2004 and devoted to this agenda, OAO RZD Vice-President Boris Lapidus emphasized the importance of all the customers services provided by one department, which is to comprise signing of contracts, monitoring their fulfillment and dealing with customers' claims. Production sales and everything they comprise must become the Center of Transportation Services responsibility.
The separation of the production itself and selling functions is considered by OAO RZD authorities as a key point for improvement in the railway company's performance efficiency, increasing its transparency and flexibility in regards to the changing conjuncture that concerns high quality transportation services, so it embraces a range of significant aspects starting from the service planning and ending up with the appropriate up-to-date tariff policy. Transparency and flexibility are required by a railway company's customer in the first place. The standard list of services and unified price list have already been promised to the company's customers as well as more cautious order making and fulfillment and providing door-to-door transportation services. The principle of transparency will allow to locate the so-called "weak points" in the company's performance. It may concern planning, new transportation technology application and investment into the company's infrastructure development.
Mistakes not to be repeated
It should be clearly understood that putting all these much promising prospects into practice requires a detailed plan to fulfill the tasks set. It will be difficult to avoid an analysis of previously made mistakes. Similar goals were declared from the outset of the System of Transport Services foundation. Without doubt, it could be easily seen that many an authority - both in the MPS headquarters and at the railways - were not in favour of the newly organized department and were unprepared to change their traditional views upon work organization refusing to communicate with their clients. Of course, traditional importance of the company's production sector, whose operation had been mastered for decades, explained such a state of affairs. But at that moment, eight years ago, partly because of the hot discussions this problem arose and a desire for a compromise, partly due to some law restrictions one very important step, in many an expert's opinion, was not made, which led to the appearance of a long-lasting obstacle to the new system of business relation development. The System of Transport Services statuary acts were produced, but hardly anything was done to introduce them in other departments. It resulted in the arrival of such problems as the absence of clear function division and function doubling, the dependence of transportation services success or failure on the local railway authorities" attitude to the newly introduced department, which, on the whole, prevented the realization of the good prospects.
On condition that a railway company, which aims, first of all, to increase its profitability, was to be established, all these drawbacks almost immediately became obvious, and the ways of correcting them were found.
The measures being proposed nowadays can be called a breakthrough in the railway transport system. It concerns not only marketing in particular, but all the OAO RZD management structure in general.
The proposed steps introduce the application of the processing approach to all levels of OAO RZD management structure, the development of the technological processes within the company subdivision coordination, and the company's subdivisions and consumer service. This means that all the company's activities are appreciated as interrelated functional processes aimed at producing or providing services.
Then those to be in charge of a certain process are to be appointed (it may be a department or a subdivision of the company, which organizes, manages and takes responsibility for a specific functional process). They will coordinate their activities with other OAO RZD subdivisions within their sphere of responsibility and competence, on the one hand, and create regulations, on the other. To evaluate the performance of the responsibility centers and other functional process participants the company's standard "OAO RZD Quality Management" is to be introduced. Some experts have already named it "the standard of standards" as in accordance with it the application of internal company coordination rules will be estimated.
The specially established committee of OAO RZD quality managing will control the way principles of organizing and managing the main functional processes are applied in practice.
Speaking about the System of Transport Services, according to the proposed project it will be in charge of twelve functional processes (marketing, service range policy, service price policy, customers" orders operating, cargo transportation forecasting, sales budgeting, composite order dealing, transportation and service delivery, commercial traffic control, customers' payment arrangement, delivered services quality management, logistics) and will participate in a number of others. It goes without saying, both the given list and the contents of the processes mentioned can be reconsidered and amended. Within the proposed system the Center of Transport Services is taking responsibility for the performance of each of the functions mentioned, and simultaneously conditions are being provided for a system of responsibility to be created to deal with the fulfilment of tasks set among the departments and subdivisions involved in a certain process.
According to the opinion of OAO RZD Vice-President Anna Belova, the relations between the company's divisions involved in a functional process must be based on the in-company self- supporting basis and financial responsibility, which has to be regulated by a motivating budget. Boris Lapidus supposes in this case the necessary prerequisites will arise to create an effective "customer-producer" pattern through all the company's structure, which is an essential business principle not only for the marketing department but for the whole company. Without doubt, some conflicting situations might appear and be settled, but as it is well known from the course of political economics they are quite natural for any business structure and, in any case, help its development.
Alexander Retyunin
Tatyana Tokareva
[~DETAIL_TEXT] =>
Starting point
As a result of the decision made, the Russian Railways System of Transport Services was founded in 1996. It has the following structure: the organization is headquartered in Moscow as the Russian Railways Center of Transport Services, its branches - the railway's centers of transport services - operate on each of the 17 railways, with their regional units - regional centers of transport services - functioning at the key stations of cargo flow formations.
From the very beginning of OAO RZD foundation, the Center of Transportation Services naturally became its part as a marketing and service-promoting department of the Russian Railways. The main responsibility of this department is the company's marketing policy development and promoting railway transportation services concerning cargo transportation.
Therefore, the System of Transport Services is the unique central structure that provides, on behalf of OAO RZD, for negotiations with clients at the stage of cargo transportation orders being settled and performed. The fulfillment of working contracts with private carriers, railway rolling stock operators, forwarding companies and other partners is also within the sphere of its responsibility. The System of Transport Services main functions are as follows: to organize cargo transportation performed by the railways, to operate railway transport infrastructure of common use belonging to OAO RZD for cargo transportation, information and other extra services, as well as to sell and rent the railway rolling stock.
Summing up the official statements it can be concluded that in practice the railway's centers of transport services operate as a mediator organization between the consumers and the producer, i.e. the railways, on behalf of the Russian Railways System of Transport Services. Such a mission predetermined the department's reformation in accordance with the company's new circumstances. As the basic principle chosen was that of sharing responsibilities, the production itself (cargo transportation) and the selling policy were divided.
What does this principle mean in practice? All the custom services, whose two main constituents are marketing and cargo transportation sales, will be performed exclusively by this department, the System of Transport Services. Speaking about the marketing constituent, it is comprised of objective predictions of the transportation market prospects, the investigation of potentially required transportation services, justification for cargo transportation tariffs and other services provided and the development of new services. As for the second constituent - cargo transportation sales - it includes providing services sales and equal quality service guaranteed for each customer as well as equal service availability, a standard list of services, unified price policy and on time payments.
At the board meeting held in April 2004 and devoted to this agenda, OAO RZD Vice-President Boris Lapidus emphasized the importance of all the customers services provided by one department, which is to comprise signing of contracts, monitoring their fulfillment and dealing with customers' claims. Production sales and everything they comprise must become the Center of Transportation Services responsibility.
The separation of the production itself and selling functions is considered by OAO RZD authorities as a key point for improvement in the railway company's performance efficiency, increasing its transparency and flexibility in regards to the changing conjuncture that concerns high quality transportation services, so it embraces a range of significant aspects starting from the service planning and ending up with the appropriate up-to-date tariff policy. Transparency and flexibility are required by a railway company's customer in the first place. The standard list of services and unified price list have already been promised to the company's customers as well as more cautious order making and fulfillment and providing door-to-door transportation services. The principle of transparency will allow to locate the so-called "weak points" in the company's performance. It may concern planning, new transportation technology application and investment into the company's infrastructure development.
Mistakes not to be repeated
It should be clearly understood that putting all these much promising prospects into practice requires a detailed plan to fulfill the tasks set. It will be difficult to avoid an analysis of previously made mistakes. Similar goals were declared from the outset of the System of Transport Services foundation. Without doubt, it could be easily seen that many an authority - both in the MPS headquarters and at the railways - were not in favour of the newly organized department and were unprepared to change their traditional views upon work organization refusing to communicate with their clients. Of course, traditional importance of the company's production sector, whose operation had been mastered for decades, explained such a state of affairs. But at that moment, eight years ago, partly because of the hot discussions this problem arose and a desire for a compromise, partly due to some law restrictions one very important step, in many an expert's opinion, was not made, which led to the appearance of a long-lasting obstacle to the new system of business relation development. The System of Transport Services statuary acts were produced, but hardly anything was done to introduce them in other departments. It resulted in the arrival of such problems as the absence of clear function division and function doubling, the dependence of transportation services success or failure on the local railway authorities" attitude to the newly introduced department, which, on the whole, prevented the realization of the good prospects.
On condition that a railway company, which aims, first of all, to increase its profitability, was to be established, all these drawbacks almost immediately became obvious, and the ways of correcting them were found.
The measures being proposed nowadays can be called a breakthrough in the railway transport system. It concerns not only marketing in particular, but all the OAO RZD management structure in general.
The proposed steps introduce the application of the processing approach to all levels of OAO RZD management structure, the development of the technological processes within the company subdivision coordination, and the company's subdivisions and consumer service. This means that all the company's activities are appreciated as interrelated functional processes aimed at producing or providing services.
Then those to be in charge of a certain process are to be appointed (it may be a department or a subdivision of the company, which organizes, manages and takes responsibility for a specific functional process). They will coordinate their activities with other OAO RZD subdivisions within their sphere of responsibility and competence, on the one hand, and create regulations, on the other. To evaluate the performance of the responsibility centers and other functional process participants the company's standard "OAO RZD Quality Management" is to be introduced. Some experts have already named it "the standard of standards" as in accordance with it the application of internal company coordination rules will be estimated.
The specially established committee of OAO RZD quality managing will control the way principles of organizing and managing the main functional processes are applied in practice.
Speaking about the System of Transport Services, according to the proposed project it will be in charge of twelve functional processes (marketing, service range policy, service price policy, customers" orders operating, cargo transportation forecasting, sales budgeting, composite order dealing, transportation and service delivery, commercial traffic control, customers' payment arrangement, delivered services quality management, logistics) and will participate in a number of others. It goes without saying, both the given list and the contents of the processes mentioned can be reconsidered and amended. Within the proposed system the Center of Transport Services is taking responsibility for the performance of each of the functions mentioned, and simultaneously conditions are being provided for a system of responsibility to be created to deal with the fulfilment of tasks set among the departments and subdivisions involved in a certain process.
According to the opinion of OAO RZD Vice-President Anna Belova, the relations between the company's divisions involved in a functional process must be based on the in-company self- supporting basis and financial responsibility, which has to be regulated by a motivating budget. Boris Lapidus supposes in this case the necessary prerequisites will arise to create an effective "customer-producer" pattern through all the company's structure, which is an essential business principle not only for the marketing department but for the whole company. Without doubt, some conflicting situations might appear and be settled, but as it is well known from the course of political economics they are quite natural for any business structure and, in any case, help its development.
Alexander Retyunin
Tatyana Tokareva
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[DETAIL_TEXT] =>
Starting point
As a result of the decision made, the Russian Railways System of Transport Services was founded in 1996. It has the following structure: the organization is headquartered in Moscow as the Russian Railways Center of Transport Services, its branches - the railway's centers of transport services - operate on each of the 17 railways, with their regional units - regional centers of transport services - functioning at the key stations of cargo flow formations.
From the very beginning of OAO RZD foundation, the Center of Transportation Services naturally became its part as a marketing and service-promoting department of the Russian Railways. The main responsibility of this department is the company's marketing policy development and promoting railway transportation services concerning cargo transportation.
Therefore, the System of Transport Services is the unique central structure that provides, on behalf of OAO RZD, for negotiations with clients at the stage of cargo transportation orders being settled and performed. The fulfillment of working contracts with private carriers, railway rolling stock operators, forwarding companies and other partners is also within the sphere of its responsibility. The System of Transport Services main functions are as follows: to organize cargo transportation performed by the railways, to operate railway transport infrastructure of common use belonging to OAO RZD for cargo transportation, information and other extra services, as well as to sell and rent the railway rolling stock.
Summing up the official statements it can be concluded that in practice the railway's centers of transport services operate as a mediator organization between the consumers and the producer, i.e. the railways, on behalf of the Russian Railways System of Transport Services. Such a mission predetermined the department's reformation in accordance with the company's new circumstances. As the basic principle chosen was that of sharing responsibilities, the production itself (cargo transportation) and the selling policy were divided.
What does this principle mean in practice? All the custom services, whose two main constituents are marketing and cargo transportation sales, will be performed exclusively by this department, the System of Transport Services. Speaking about the marketing constituent, it is comprised of objective predictions of the transportation market prospects, the investigation of potentially required transportation services, justification for cargo transportation tariffs and other services provided and the development of new services. As for the second constituent - cargo transportation sales - it includes providing services sales and equal quality service guaranteed for each customer as well as equal service availability, a standard list of services, unified price policy and on time payments.
At the board meeting held in April 2004 and devoted to this agenda, OAO RZD Vice-President Boris Lapidus emphasized the importance of all the customers services provided by one department, which is to comprise signing of contracts, monitoring their fulfillment and dealing with customers' claims. Production sales and everything they comprise must become the Center of Transportation Services responsibility.
The separation of the production itself and selling functions is considered by OAO RZD authorities as a key point for improvement in the railway company's performance efficiency, increasing its transparency and flexibility in regards to the changing conjuncture that concerns high quality transportation services, so it embraces a range of significant aspects starting from the service planning and ending up with the appropriate up-to-date tariff policy. Transparency and flexibility are required by a railway company's customer in the first place. The standard list of services and unified price list have already been promised to the company's customers as well as more cautious order making and fulfillment and providing door-to-door transportation services. The principle of transparency will allow to locate the so-called "weak points" in the company's performance. It may concern planning, new transportation technology application and investment into the company's infrastructure development.
Mistakes not to be repeated
It should be clearly understood that putting all these much promising prospects into practice requires a detailed plan to fulfill the tasks set. It will be difficult to avoid an analysis of previously made mistakes. Similar goals were declared from the outset of the System of Transport Services foundation. Without doubt, it could be easily seen that many an authority - both in the MPS headquarters and at the railways - were not in favour of the newly organized department and were unprepared to change their traditional views upon work organization refusing to communicate with their clients. Of course, traditional importance of the company's production sector, whose operation had been mastered for decades, explained such a state of affairs. But at that moment, eight years ago, partly because of the hot discussions this problem arose and a desire for a compromise, partly due to some law restrictions one very important step, in many an expert's opinion, was not made, which led to the appearance of a long-lasting obstacle to the new system of business relation development. The System of Transport Services statuary acts were produced, but hardly anything was done to introduce them in other departments. It resulted in the arrival of such problems as the absence of clear function division and function doubling, the dependence of transportation services success or failure on the local railway authorities" attitude to the newly introduced department, which, on the whole, prevented the realization of the good prospects.
On condition that a railway company, which aims, first of all, to increase its profitability, was to be established, all these drawbacks almost immediately became obvious, and the ways of correcting them were found.
The measures being proposed nowadays can be called a breakthrough in the railway transport system. It concerns not only marketing in particular, but all the OAO RZD management structure in general.
The proposed steps introduce the application of the processing approach to all levels of OAO RZD management structure, the development of the technological processes within the company subdivision coordination, and the company's subdivisions and consumer service. This means that all the company's activities are appreciated as interrelated functional processes aimed at producing or providing services.
Then those to be in charge of a certain process are to be appointed (it may be a department or a subdivision of the company, which organizes, manages and takes responsibility for a specific functional process). They will coordinate their activities with other OAO RZD subdivisions within their sphere of responsibility and competence, on the one hand, and create regulations, on the other. To evaluate the performance of the responsibility centers and other functional process participants the company's standard "OAO RZD Quality Management" is to be introduced. Some experts have already named it "the standard of standards" as in accordance with it the application of internal company coordination rules will be estimated.
The specially established committee of OAO RZD quality managing will control the way principles of organizing and managing the main functional processes are applied in practice.
Speaking about the System of Transport Services, according to the proposed project it will be in charge of twelve functional processes (marketing, service range policy, service price policy, customers" orders operating, cargo transportation forecasting, sales budgeting, composite order dealing, transportation and service delivery, commercial traffic control, customers' payment arrangement, delivered services quality management, logistics) and will participate in a number of others. It goes without saying, both the given list and the contents of the processes mentioned can be reconsidered and amended. Within the proposed system the Center of Transport Services is taking responsibility for the performance of each of the functions mentioned, and simultaneously conditions are being provided for a system of responsibility to be created to deal with the fulfilment of tasks set among the departments and subdivisions involved in a certain process.
According to the opinion of OAO RZD Vice-President Anna Belova, the relations between the company's divisions involved in a functional process must be based on the in-company self- supporting basis and financial responsibility, which has to be regulated by a motivating budget. Boris Lapidus supposes in this case the necessary prerequisites will arise to create an effective "customer-producer" pattern through all the company's structure, which is an essential business principle not only for the marketing department but for the whole company. Without doubt, some conflicting situations might appear and be settled, but as it is well known from the course of political economics they are quite natural for any business structure and, in any case, help its development.
Alexander Retyunin
Tatyana Tokareva
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Starting point
As a result of the decision made, the Russian Railways System of Transport Services was founded in 1996. It has the following structure: the organization is headquartered in Moscow as the Russian Railways Center of Transport Services, its branches - the railway's centers of transport services - operate on each of the 17 railways, with their regional units - regional centers of transport services - functioning at the key stations of cargo flow formations.
From the very beginning of OAO RZD foundation, the Center of Transportation Services naturally became its part as a marketing and service-promoting department of the Russian Railways. The main responsibility of this department is the company's marketing policy development and promoting railway transportation services concerning cargo transportation.
Therefore, the System of Transport Services is the unique central structure that provides, on behalf of OAO RZD, for negotiations with clients at the stage of cargo transportation orders being settled and performed. The fulfillment of working contracts with private carriers, railway rolling stock operators, forwarding companies and other partners is also within the sphere of its responsibility. The System of Transport Services main functions are as follows: to organize cargo transportation performed by the railways, to operate railway transport infrastructure of common use belonging to OAO RZD for cargo transportation, information and other extra services, as well as to sell and rent the railway rolling stock.
Summing up the official statements it can be concluded that in practice the railway's centers of transport services operate as a mediator organization between the consumers and the producer, i.e. the railways, on behalf of the Russian Railways System of Transport Services. Such a mission predetermined the department's reformation in accordance with the company's new circumstances. As the basic principle chosen was that of sharing responsibilities, the production itself (cargo transportation) and the selling policy were divided.
What does this principle mean in practice? All the custom services, whose two main constituents are marketing and cargo transportation sales, will be performed exclusively by this department, the System of Transport Services. Speaking about the marketing constituent, it is comprised of objective predictions of the transportation market prospects, the investigation of potentially required transportation services, justification for cargo transportation tariffs and other services provided and the development of new services. As for the second constituent - cargo transportation sales - it includes providing services sales and equal quality service guaranteed for each customer as well as equal service availability, a standard list of services, unified price policy and on time payments.
At the board meeting held in April 2004 and devoted to this agenda, OAO RZD Vice-President Boris Lapidus emphasized the importance of all the customers services provided by one department, which is to comprise signing of contracts, monitoring their fulfillment and dealing with customers' claims. Production sales and everything they comprise must become the Center of Transportation Services responsibility.
The separation of the production itself and selling functions is considered by OAO RZD authorities as a key point for improvement in the railway company's performance efficiency, increasing its transparency and flexibility in regards to the changing conjuncture that concerns high quality transportation services, so it embraces a range of significant aspects starting from the service planning and ending up with the appropriate up-to-date tariff policy. Transparency and flexibility are required by a railway company's customer in the first place. The standard list of services and unified price list have already been promised to the company's customers as well as more cautious order making and fulfillment and providing door-to-door transportation services. The principle of transparency will allow to locate the so-called "weak points" in the company's performance. It may concern planning, new transportation technology application and investment into the company's infrastructure development.
Mistakes not to be repeated
It should be clearly understood that putting all these much promising prospects into practice requires a detailed plan to fulfill the tasks set. It will be difficult to avoid an analysis of previously made mistakes. Similar goals were declared from the outset of the System of Transport Services foundation. Without doubt, it could be easily seen that many an authority - both in the MPS headquarters and at the railways - were not in favour of the newly organized department and were unprepared to change their traditional views upon work organization refusing to communicate with their clients. Of course, traditional importance of the company's production sector, whose operation had been mastered for decades, explained such a state of affairs. But at that moment, eight years ago, partly because of the hot discussions this problem arose and a desire for a compromise, partly due to some law restrictions one very important step, in many an expert's opinion, was not made, which led to the appearance of a long-lasting obstacle to the new system of business relation development. The System of Transport Services statuary acts were produced, but hardly anything was done to introduce them in other departments. It resulted in the arrival of such problems as the absence of clear function division and function doubling, the dependence of transportation services success or failure on the local railway authorities" attitude to the newly introduced department, which, on the whole, prevented the realization of the good prospects.
On condition that a railway company, which aims, first of all, to increase its profitability, was to be established, all these drawbacks almost immediately became obvious, and the ways of correcting them were found.
The measures being proposed nowadays can be called a breakthrough in the railway transport system. It concerns not only marketing in particular, but all the OAO RZD management structure in general.
The proposed steps introduce the application of the processing approach to all levels of OAO RZD management structure, the development of the technological processes within the company subdivision coordination, and the company's subdivisions and consumer service. This means that all the company's activities are appreciated as interrelated functional processes aimed at producing or providing services.
Then those to be in charge of a certain process are to be appointed (it may be a department or a subdivision of the company, which organizes, manages and takes responsibility for a specific functional process). They will coordinate their activities with other OAO RZD subdivisions within their sphere of responsibility and competence, on the one hand, and create regulations, on the other. To evaluate the performance of the responsibility centers and other functional process participants the company's standard "OAO RZD Quality Management" is to be introduced. Some experts have already named it "the standard of standards" as in accordance with it the application of internal company coordination rules will be estimated.
The specially established committee of OAO RZD quality managing will control the way principles of organizing and managing the main functional processes are applied in practice.
Speaking about the System of Transport Services, according to the proposed project it will be in charge of twelve functional processes (marketing, service range policy, service price policy, customers" orders operating, cargo transportation forecasting, sales budgeting, composite order dealing, transportation and service delivery, commercial traffic control, customers' payment arrangement, delivered services quality management, logistics) and will participate in a number of others. It goes without saying, both the given list and the contents of the processes mentioned can be reconsidered and amended. Within the proposed system the Center of Transport Services is taking responsibility for the performance of each of the functions mentioned, and simultaneously conditions are being provided for a system of responsibility to be created to deal with the fulfilment of tasks set among the departments and subdivisions involved in a certain process.
According to the opinion of OAO RZD Vice-President Anna Belova, the relations between the company's divisions involved in a functional process must be based on the in-company self- supporting basis and financial responsibility, which has to be regulated by a motivating budget. Boris Lapidus supposes in this case the necessary prerequisites will arise to create an effective "customer-producer" pattern through all the company's structure, which is an essential business principle not only for the marketing department but for the whole company. Without doubt, some conflicting situations might appear and be settled, but as it is well known from the course of political economics they are quite natural for any business structure and, in any case, help its development.
Alexander Retyunin
Tatyana Tokareva
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[DETAIL_TEXT] => A major European oil and gas producer, Norway's Norsk Hydro, has long been keen on operating in Russia.
According to Company's president and chief executive officer Eivind Reiten, Russia could use Norsk hydro as a possible place to house a primary aluminum plant.
At present, the company cooperates with Russian Aluminum that supplies it with its own products that Norsk Hydro sells on the European and American markets.
Last year, Gazprom announced that it could team up with Norsk Hydro on developing the Shtokman gas field. According to Reiten, he has regularly seen top managers of Gazprom. Norsk Hydro has been considering various concepts of developing the Shtokman field for a long time. One of the early concepts provided for a platform to be set up on the shelf. Now the company ponders a different approach that makes provision for underwater gas field development and transporting gas to the shore via a pipeline. Gas treatment facilities are to be built on shore. The company is going to export liquefied natural gas to the United States once the gas field starts yielding gas.
Asked about the share in the Shtokman field Norsk Hydro would like to get, Reiten mentioned 15%.
According to him, proceeding from the cost of the first stage, estimated at $8-10 billion, Norsk Hydro is ready to provide 15% of investment in the project.
The company is calm as regards the initiative of the Russian Ministry of Natural Resources to restrict foreigners" participation in the companies developing strategic deposits to minority shares.
"We have never sought to dominate any Russian project, therefore, this will not affect us," the Norsk Hydro president said.
The company produced 28.5 million tons of oil and 852 million cu.m of natural gas in 2004. It ranks third in producing aluminum and aluminum products. In 2004, Norsk Hydro's operating revenues totaled 18.9 billion euros, with its profit standing at 1.5 billion euros. Its capitalization equaled $21.4 billion as of April 11, 2004.
Iran-Azerbaijan Railway Line Agreement Signed
Railway chiefs of Azerbaijan, Iran and Russia have signed an agreement for construction of a railway line linking Qazvin (Iran), Rasht (Iran) and Astara (Azerbaijan).
The Qazvin-Rasht-Astara railway line will become a key component of the international north-south transport corridor. Currently, Russian Railways are negotiating over the possibility that Finnish railroads resume bulk paper-transportation to Iran.
OAO RZD is ready to assume commitments to finance a final feasibility study and business plan development as part of its share in the project. Construction is to be gradual. First, it will be completed in Azerbaijan, and afterwards in Iran, where at least 400 kilometers of railways are to be built. Funds to finance it will be allocated in installments by Russia, Azerbaijan, Iran, and other creditors.
RZD and Deutsche Bahn Signed an Agreement to Set up Joint Venture
OAO RZD and Railion Deutschland AG have signed an agreement on the foundation of Railion-Russia joint enterprise.
On the 11th of April in Hannover, in the framework of the Hannover fair, Gennady Fadeyev, the President of OAO RZD, and Hartmud Medorn, the Chair of the Administration of Deutsche Bahn AG (that holds 100% of Railion Deutschland AG shares), signed an agreement on cooperation in the field of International freight traffic. The key point of the agreement is the foundation of the Railion-Russia joint enterprise.
A declaration of the foundation of this joint enterprise was signed in Berlin on the 17th of September 2004.
The prerequisites for creating this enterprise have been the growth of trade between Germany and Russia, the growth of railway transport of International freight, and the dynamic development of the countries in Asian-Pacific region. They actively trade with European Union: experts estimate the goods turnover between EC and Asian-Pacific region to be $650 billion in 2005, which is to further grow by 25-30% by 2010.
The agreement signed says about the joint development of International freight railway service between Russia and Germany within International transport corridor 2 up to China.
The main task of the enterprise is to increase railway traffic and to balance transport flows within International transport corridor 2, as well as to make railway transport more competitive than other types of transport.
Railion-Russia will provide an integrated "through" service connecting Russia and Germany. The joint enterprise will coordinate freight transport along Russian, Byelorussian, Polish, and German railways on the basis of agreements with corresponding railways. The enterprise will be registered in the Russian Federation. The parties are to prepare a plan of the business-project by the end of May.
The joint enterprise will have not only to cross four State borders but also to adapt to different transport regulation systems, customs and border formalities, and different track gauges (1.520 mm in Russia as opposed to 1.435 mm in Europe).
Experts say that the joint enterprise will be competitive due to the optimization of transportation process, elimination of intermediary agents (which significantly increase the traffic costs), coordinated freight transport along Russian, Byelorussian, Polish, and German railways, and providing additional accompanying, customs and other services.
"The joint enterprise will create favourable conditions for economic relationships between our countries, make railway transport more competitive, and attract more traffic. We plan to decrease the traffic cost, increase the service quality, and expedite the freight delivery that should attract new customers', commented Gennady Fadeyev, the CEO of OAO RZD.
usd 100 Mln IFC Loan for Port
The International Finance Corporation, the World Bank's private lending unit, will provide $100 million to Russky Mir, Russia's largest private rail transporter of oil, to build a petroleum port on the Black Sea.
IFC's board on April 29 approved two loans totaling $100 million, Olga Platonova, an official at Russky Mir's financial department, said in a note on May 3, 2005.
The project will require investment of at least $264 million.
Russia Suspends Import Duty on Iron Ore
Russia will suspend the 5% import duty on iron ores and concentrates for a period of nine months.
Russian Prime Minister Mikhail Fradkov signed a resolution lifting the duties on non-agglomerated and agglomerated iron ores and concentrates (customs classification TN VED 2601 11 000 0 and 2601 12 000 0).
The resolution enters into effect a month after its official publication.
Gov't Approves Bill on Special Economic Zones
In March, the Russian government approved in principle the bill "On special economic zones." The bill was finalized within the next two weeks, after which it will be sent to the State Duma.
It envisages the creation of two kinds of free economic zone in Russia - technical and promotional, and industrial and manufacturing. The bill also introduces customs and tax privileges for businesses operating in those areas.
According to the economy ministry, the first economic zones will start working in 2007. This project will attract investors and help diversify the Russian economy, economy ministry officials hope.
Economy minister German Gref said residents of special economic zones were individual or commercial enterprises, who signed agreements with local authorities to conduct business in special economic zones. Residents of manufacturing and industrial economic zones will have to invest at least EUR 10 million to get permission to conduct business. Another EUR 1 million is to be invested within a year after the agreement is signed.
"We plan that state investment will be provided 50/50 by federal and regional authorities," economy minister Gref said. Special economic zones will be created by the government on a competitive basis. The Cabinet and regional authorities will sign agreements defining the obligations of federal and regional authorities regarding the period during which special economic zones should be created, and the necessary investment and infrastructure.
The economy ministry suggests exempting the residents of special economic zones from tax on property and land for a period of five years. They will also be exempt from import taxes - a measure aimed at stimulating export-oriented businesses and attracting investment in the manufacturing sector.
According to the bill, such zones will be free customs areas, where foreign goods will be moved without payment of customs tariffs, taxes and without applying other economic restrictions envisaged by legislation on state regulation of foreign trade. Rules for the export of goods will be applied in special economic zones; excise duties will be paid.
Customs tariffs and taxes will be paid on foreign and Russian goods moved from special economic zones into other regions of the country, in accordance with Russian customs and tax laws. Import tariffs and taxes will not be paid on such goods exported from Russia, while export taxes will be paid.
The economy ministry offers to lower the single social tax for technical and promotional zones. Gref said the single social tax rate in such zones will be 14 percent a month for people with wages up to $700 a month; 5.9 percent for those with wages between $700 and $2,000, and 2 percent for taxpayers with wages above $2,000. The economy minister noted that this would create optimal conditions for scientific research.
He proposed that more significant privileges should be offered to some special economic areas such as East Siberia and the Far East. Gref went even further, suggesting "huge" tax exemptions for 10-15 years for Sakhalin and Kamchatka. "The most important thing is that investment comes in," he stressed.
Gref thinks the bill will stimulate economic diversification and investment. He noted that many practical steps had been taken in Russia in recent years to diversify the economy. "The bill will allow us to re-orient our economy in favor of manufacturing industries," Gref said.
There are around 1,200 such zones in the world, from the United States to Western Europe, South East Asia and Cyprus. Though the bill offers "minimal tax privileges", it will become a real incentive for investment, Gref hopes.
At the same time, the economy minister did not rule out that some companies might use special economic zones for tax evasion. Prime minister Mikhail Fradkov also noted that Russia already had negative experience with free economic areas, which he said should be taken into account.
OAO RZD Invests RUR20 bln to Increase Safety of Rail Traffic
During next three years OAO RZD is to invest over 20 bln. roubles to implement a program aimed at increasing safety of rail traffic.
On April 26, this fact was voiced by RZD CEO Gennady Fadeyev at the telephone conference, which discussed safety of rail traffic.
"The Russian rail transport is currently the safest mode of transport. The last Board meeting decided to quarterly hold meetings on safety of rail traffic," Gennady Fadeyev said. "Providing of rail traffic safety is closely connected with RZD activities and needs serious investments. During three years the investments into the program on increasing rail traffic safety will exceed 20 bln. roubles."
It should be recalled that the decision to develop a programme aimed at perfecting the safety management system on the basis of sophisticated IT and information transmission devices was adopted at the Board meeting on this March 16. In addition, the Board approved the proposal to develop a program on re-equipping passenger locos with state-of-art safety traffic systems and install on railway bed low-ground and post devices of digital radio-communication in 2006-2010.
Chechen President and Rosneft Head Discuss Establishment of New Oil Company
Chechen President Alu Alkhanov meet Rosneft head Sergey Bogdanchikov. The two parties have discussed the establishment of the Chechen Oil Company among other issues.
Rosneft is the only company producing oil in the Chechen republic via its subsidiary Grozneftegaz. Rosneft is to allocate the major part of revenue from sales of oil produced in the republic for rebuilding projects. Nevertheless, regional authorities insist on the establishment of a Chechen-based oil company.
Rosneft wants to boost oil production in the Chechen republic by 12.2 percent in 2005 to 2.2m tons. Gas production is targeted to grow 4 percent to 530m cubic meters. Investments in oil production are to reach RUR640bn (around USD22.85bn).
[~DETAIL_TEXT] => A major European oil and gas producer, Norway's Norsk Hydro, has long been keen on operating in Russia.
According to Company's president and chief executive officer Eivind Reiten, Russia could use Norsk hydro as a possible place to house a primary aluminum plant.
At present, the company cooperates with Russian Aluminum that supplies it with its own products that Norsk Hydro sells on the European and American markets.
Last year, Gazprom announced that it could team up with Norsk Hydro on developing the Shtokman gas field. According to Reiten, he has regularly seen top managers of Gazprom. Norsk Hydro has been considering various concepts of developing the Shtokman field for a long time. One of the early concepts provided for a platform to be set up on the shelf. Now the company ponders a different approach that makes provision for underwater gas field development and transporting gas to the shore via a pipeline. Gas treatment facilities are to be built on shore. The company is going to export liquefied natural gas to the United States once the gas field starts yielding gas.
Asked about the share in the Shtokman field Norsk Hydro would like to get, Reiten mentioned 15%.
According to him, proceeding from the cost of the first stage, estimated at $8-10 billion, Norsk Hydro is ready to provide 15% of investment in the project.
The company is calm as regards the initiative of the Russian Ministry of Natural Resources to restrict foreigners" participation in the companies developing strategic deposits to minority shares.
"We have never sought to dominate any Russian project, therefore, this will not affect us," the Norsk Hydro president said.
The company produced 28.5 million tons of oil and 852 million cu.m of natural gas in 2004. It ranks third in producing aluminum and aluminum products. In 2004, Norsk Hydro's operating revenues totaled 18.9 billion euros, with its profit standing at 1.5 billion euros. Its capitalization equaled $21.4 billion as of April 11, 2004.
Iran-Azerbaijan Railway Line Agreement Signed
Railway chiefs of Azerbaijan, Iran and Russia have signed an agreement for construction of a railway line linking Qazvin (Iran), Rasht (Iran) and Astara (Azerbaijan).
The Qazvin-Rasht-Astara railway line will become a key component of the international north-south transport corridor. Currently, Russian Railways are negotiating over the possibility that Finnish railroads resume bulk paper-transportation to Iran.
OAO RZD is ready to assume commitments to finance a final feasibility study and business plan development as part of its share in the project. Construction is to be gradual. First, it will be completed in Azerbaijan, and afterwards in Iran, where at least 400 kilometers of railways are to be built. Funds to finance it will be allocated in installments by Russia, Azerbaijan, Iran, and other creditors.
RZD and Deutsche Bahn Signed an Agreement to Set up Joint Venture
OAO RZD and Railion Deutschland AG have signed an agreement on the foundation of Railion-Russia joint enterprise.
On the 11th of April in Hannover, in the framework of the Hannover fair, Gennady Fadeyev, the President of OAO RZD, and Hartmud Medorn, the Chair of the Administration of Deutsche Bahn AG (that holds 100% of Railion Deutschland AG shares), signed an agreement on cooperation in the field of International freight traffic. The key point of the agreement is the foundation of the Railion-Russia joint enterprise.
A declaration of the foundation of this joint enterprise was signed in Berlin on the 17th of September 2004.
The prerequisites for creating this enterprise have been the growth of trade between Germany and Russia, the growth of railway transport of International freight, and the dynamic development of the countries in Asian-Pacific region. They actively trade with European Union: experts estimate the goods turnover between EC and Asian-Pacific region to be $650 billion in 2005, which is to further grow by 25-30% by 2010.
The agreement signed says about the joint development of International freight railway service between Russia and Germany within International transport corridor 2 up to China.
The main task of the enterprise is to increase railway traffic and to balance transport flows within International transport corridor 2, as well as to make railway transport more competitive than other types of transport.
Railion-Russia will provide an integrated "through" service connecting Russia and Germany. The joint enterprise will coordinate freight transport along Russian, Byelorussian, Polish, and German railways on the basis of agreements with corresponding railways. The enterprise will be registered in the Russian Federation. The parties are to prepare a plan of the business-project by the end of May.
The joint enterprise will have not only to cross four State borders but also to adapt to different transport regulation systems, customs and border formalities, and different track gauges (1.520 mm in Russia as opposed to 1.435 mm in Europe).
Experts say that the joint enterprise will be competitive due to the optimization of transportation process, elimination of intermediary agents (which significantly increase the traffic costs), coordinated freight transport along Russian, Byelorussian, Polish, and German railways, and providing additional accompanying, customs and other services.
"The joint enterprise will create favourable conditions for economic relationships between our countries, make railway transport more competitive, and attract more traffic. We plan to decrease the traffic cost, increase the service quality, and expedite the freight delivery that should attract new customers', commented Gennady Fadeyev, the CEO of OAO RZD.
usd 100 Mln IFC Loan for Port
The International Finance Corporation, the World Bank's private lending unit, will provide $100 million to Russky Mir, Russia's largest private rail transporter of oil, to build a petroleum port on the Black Sea.
IFC's board on April 29 approved two loans totaling $100 million, Olga Platonova, an official at Russky Mir's financial department, said in a note on May 3, 2005.
The project will require investment of at least $264 million.
Russia Suspends Import Duty on Iron Ore
Russia will suspend the 5% import duty on iron ores and concentrates for a period of nine months.
Russian Prime Minister Mikhail Fradkov signed a resolution lifting the duties on non-agglomerated and agglomerated iron ores and concentrates (customs classification TN VED 2601 11 000 0 and 2601 12 000 0).
The resolution enters into effect a month after its official publication.
Gov't Approves Bill on Special Economic Zones
In March, the Russian government approved in principle the bill "On special economic zones." The bill was finalized within the next two weeks, after which it will be sent to the State Duma.
It envisages the creation of two kinds of free economic zone in Russia - technical and promotional, and industrial and manufacturing. The bill also introduces customs and tax privileges for businesses operating in those areas.
According to the economy ministry, the first economic zones will start working in 2007. This project will attract investors and help diversify the Russian economy, economy ministry officials hope.
Economy minister German Gref said residents of special economic zones were individual or commercial enterprises, who signed agreements with local authorities to conduct business in special economic zones. Residents of manufacturing and industrial economic zones will have to invest at least EUR 10 million to get permission to conduct business. Another EUR 1 million is to be invested within a year after the agreement is signed.
"We plan that state investment will be provided 50/50 by federal and regional authorities," economy minister Gref said. Special economic zones will be created by the government on a competitive basis. The Cabinet and regional authorities will sign agreements defining the obligations of federal and regional authorities regarding the period during which special economic zones should be created, and the necessary investment and infrastructure.
The economy ministry suggests exempting the residents of special economic zones from tax on property and land for a period of five years. They will also be exempt from import taxes - a measure aimed at stimulating export-oriented businesses and attracting investment in the manufacturing sector.
According to the bill, such zones will be free customs areas, where foreign goods will be moved without payment of customs tariffs, taxes and without applying other economic restrictions envisaged by legislation on state regulation of foreign trade. Rules for the export of goods will be applied in special economic zones; excise duties will be paid.
Customs tariffs and taxes will be paid on foreign and Russian goods moved from special economic zones into other regions of the country, in accordance with Russian customs and tax laws. Import tariffs and taxes will not be paid on such goods exported from Russia, while export taxes will be paid.
The economy ministry offers to lower the single social tax for technical and promotional zones. Gref said the single social tax rate in such zones will be 14 percent a month for people with wages up to $700 a month; 5.9 percent for those with wages between $700 and $2,000, and 2 percent for taxpayers with wages above $2,000. The economy minister noted that this would create optimal conditions for scientific research.
He proposed that more significant privileges should be offered to some special economic areas such as East Siberia and the Far East. Gref went even further, suggesting "huge" tax exemptions for 10-15 years for Sakhalin and Kamchatka. "The most important thing is that investment comes in," he stressed.
Gref thinks the bill will stimulate economic diversification and investment. He noted that many practical steps had been taken in Russia in recent years to diversify the economy. "The bill will allow us to re-orient our economy in favor of manufacturing industries," Gref said.
There are around 1,200 such zones in the world, from the United States to Western Europe, South East Asia and Cyprus. Though the bill offers "minimal tax privileges", it will become a real incentive for investment, Gref hopes.
At the same time, the economy minister did not rule out that some companies might use special economic zones for tax evasion. Prime minister Mikhail Fradkov also noted that Russia already had negative experience with free economic areas, which he said should be taken into account.
OAO RZD Invests RUR20 bln to Increase Safety of Rail Traffic
During next three years OAO RZD is to invest over 20 bln. roubles to implement a program aimed at increasing safety of rail traffic.
On April 26, this fact was voiced by RZD CEO Gennady Fadeyev at the telephone conference, which discussed safety of rail traffic.
"The Russian rail transport is currently the safest mode of transport. The last Board meeting decided to quarterly hold meetings on safety of rail traffic," Gennady Fadeyev said. "Providing of rail traffic safety is closely connected with RZD activities and needs serious investments. During three years the investments into the program on increasing rail traffic safety will exceed 20 bln. roubles."
It should be recalled that the decision to develop a programme aimed at perfecting the safety management system on the basis of sophisticated IT and information transmission devices was adopted at the Board meeting on this March 16. In addition, the Board approved the proposal to develop a program on re-equipping passenger locos with state-of-art safety traffic systems and install on railway bed low-ground and post devices of digital radio-communication in 2006-2010.
Chechen President and Rosneft Head Discuss Establishment of New Oil Company
Chechen President Alu Alkhanov meet Rosneft head Sergey Bogdanchikov. The two parties have discussed the establishment of the Chechen Oil Company among other issues.
Rosneft is the only company producing oil in the Chechen republic via its subsidiary Grozneftegaz. Rosneft is to allocate the major part of revenue from sales of oil produced in the republic for rebuilding projects. Nevertheless, regional authorities insist on the establishment of a Chechen-based oil company.
Rosneft wants to boost oil production in the Chechen republic by 12.2 percent in 2005 to 2.2m tons. Gas production is targeted to grow 4 percent to 530m cubic meters. Investments in oil production are to reach RUR640bn (around USD22.85bn).
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[DETAIL_TEXT] => A major European oil and gas producer, Norway's Norsk Hydro, has long been keen on operating in Russia.
According to Company's president and chief executive officer Eivind Reiten, Russia could use Norsk hydro as a possible place to house a primary aluminum plant.
At present, the company cooperates with Russian Aluminum that supplies it with its own products that Norsk Hydro sells on the European and American markets.
Last year, Gazprom announced that it could team up with Norsk Hydro on developing the Shtokman gas field. According to Reiten, he has regularly seen top managers of Gazprom. Norsk Hydro has been considering various concepts of developing the Shtokman field for a long time. One of the early concepts provided for a platform to be set up on the shelf. Now the company ponders a different approach that makes provision for underwater gas field development and transporting gas to the shore via a pipeline. Gas treatment facilities are to be built on shore. The company is going to export liquefied natural gas to the United States once the gas field starts yielding gas.
Asked about the share in the Shtokman field Norsk Hydro would like to get, Reiten mentioned 15%.
According to him, proceeding from the cost of the first stage, estimated at $8-10 billion, Norsk Hydro is ready to provide 15% of investment in the project.
The company is calm as regards the initiative of the Russian Ministry of Natural Resources to restrict foreigners" participation in the companies developing strategic deposits to minority shares.
"We have never sought to dominate any Russian project, therefore, this will not affect us," the Norsk Hydro president said.
The company produced 28.5 million tons of oil and 852 million cu.m of natural gas in 2004. It ranks third in producing aluminum and aluminum products. In 2004, Norsk Hydro's operating revenues totaled 18.9 billion euros, with its profit standing at 1.5 billion euros. Its capitalization equaled $21.4 billion as of April 11, 2004.
Iran-Azerbaijan Railway Line Agreement Signed
Railway chiefs of Azerbaijan, Iran and Russia have signed an agreement for construction of a railway line linking Qazvin (Iran), Rasht (Iran) and Astara (Azerbaijan).
The Qazvin-Rasht-Astara railway line will become a key component of the international north-south transport corridor. Currently, Russian Railways are negotiating over the possibility that Finnish railroads resume bulk paper-transportation to Iran.
OAO RZD is ready to assume commitments to finance a final feasibility study and business plan development as part of its share in the project. Construction is to be gradual. First, it will be completed in Azerbaijan, and afterwards in Iran, where at least 400 kilometers of railways are to be built. Funds to finance it will be allocated in installments by Russia, Azerbaijan, Iran, and other creditors.
RZD and Deutsche Bahn Signed an Agreement to Set up Joint Venture
OAO RZD and Railion Deutschland AG have signed an agreement on the foundation of Railion-Russia joint enterprise.
On the 11th of April in Hannover, in the framework of the Hannover fair, Gennady Fadeyev, the President of OAO RZD, and Hartmud Medorn, the Chair of the Administration of Deutsche Bahn AG (that holds 100% of Railion Deutschland AG shares), signed an agreement on cooperation in the field of International freight traffic. The key point of the agreement is the foundation of the Railion-Russia joint enterprise.
A declaration of the foundation of this joint enterprise was signed in Berlin on the 17th of September 2004.
The prerequisites for creating this enterprise have been the growth of trade between Germany and Russia, the growth of railway transport of International freight, and the dynamic development of the countries in Asian-Pacific region. They actively trade with European Union: experts estimate the goods turnover between EC and Asian-Pacific region to be $650 billion in 2005, which is to further grow by 25-30% by 2010.
The agreement signed says about the joint development of International freight railway service between Russia and Germany within International transport corridor 2 up to China.
The main task of the enterprise is to increase railway traffic and to balance transport flows within International transport corridor 2, as well as to make railway transport more competitive than other types of transport.
Railion-Russia will provide an integrated "through" service connecting Russia and Germany. The joint enterprise will coordinate freight transport along Russian, Byelorussian, Polish, and German railways on the basis of agreements with corresponding railways. The enterprise will be registered in the Russian Federation. The parties are to prepare a plan of the business-project by the end of May.
The joint enterprise will have not only to cross four State borders but also to adapt to different transport regulation systems, customs and border formalities, and different track gauges (1.520 mm in Russia as opposed to 1.435 mm in Europe).
Experts say that the joint enterprise will be competitive due to the optimization of transportation process, elimination of intermediary agents (which significantly increase the traffic costs), coordinated freight transport along Russian, Byelorussian, Polish, and German railways, and providing additional accompanying, customs and other services.
"The joint enterprise will create favourable conditions for economic relationships between our countries, make railway transport more competitive, and attract more traffic. We plan to decrease the traffic cost, increase the service quality, and expedite the freight delivery that should attract new customers', commented Gennady Fadeyev, the CEO of OAO RZD.
usd 100 Mln IFC Loan for Port
The International Finance Corporation, the World Bank's private lending unit, will provide $100 million to Russky Mir, Russia's largest private rail transporter of oil, to build a petroleum port on the Black Sea.
IFC's board on April 29 approved two loans totaling $100 million, Olga Platonova, an official at Russky Mir's financial department, said in a note on May 3, 2005.
The project will require investment of at least $264 million.
Russia Suspends Import Duty on Iron Ore
Russia will suspend the 5% import duty on iron ores and concentrates for a period of nine months.
Russian Prime Minister Mikhail Fradkov signed a resolution lifting the duties on non-agglomerated and agglomerated iron ores and concentrates (customs classification TN VED 2601 11 000 0 and 2601 12 000 0).
The resolution enters into effect a month after its official publication.
Gov't Approves Bill on Special Economic Zones
In March, the Russian government approved in principle the bill "On special economic zones." The bill was finalized within the next two weeks, after which it will be sent to the State Duma.
It envisages the creation of two kinds of free economic zone in Russia - technical and promotional, and industrial and manufacturing. The bill also introduces customs and tax privileges for businesses operating in those areas.
According to the economy ministry, the first economic zones will start working in 2007. This project will attract investors and help diversify the Russian economy, economy ministry officials hope.
Economy minister German Gref said residents of special economic zones were individual or commercial enterprises, who signed agreements with local authorities to conduct business in special economic zones. Residents of manufacturing and industrial economic zones will have to invest at least EUR 10 million to get permission to conduct business. Another EUR 1 million is to be invested within a year after the agreement is signed.
"We plan that state investment will be provided 50/50 by federal and regional authorities," economy minister Gref said. Special economic zones will be created by the government on a competitive basis. The Cabinet and regional authorities will sign agreements defining the obligations of federal and regional authorities regarding the period during which special economic zones should be created, and the necessary investment and infrastructure.
The economy ministry suggests exempting the residents of special economic zones from tax on property and land for a period of five years. They will also be exempt from import taxes - a measure aimed at stimulating export-oriented businesses and attracting investment in the manufacturing sector.
According to the bill, such zones will be free customs areas, where foreign goods will be moved without payment of customs tariffs, taxes and without applying other economic restrictions envisaged by legislation on state regulation of foreign trade. Rules for the export of goods will be applied in special economic zones; excise duties will be paid.
Customs tariffs and taxes will be paid on foreign and Russian goods moved from special economic zones into other regions of the country, in accordance with Russian customs and tax laws. Import tariffs and taxes will not be paid on such goods exported from Russia, while export taxes will be paid.
The economy ministry offers to lower the single social tax for technical and promotional zones. Gref said the single social tax rate in such zones will be 14 percent a month for people with wages up to $700 a month; 5.9 percent for those with wages between $700 and $2,000, and 2 percent for taxpayers with wages above $2,000. The economy minister noted that this would create optimal conditions for scientific research.
He proposed that more significant privileges should be offered to some special economic areas such as East Siberia and the Far East. Gref went even further, suggesting "huge" tax exemptions for 10-15 years for Sakhalin and Kamchatka. "The most important thing is that investment comes in," he stressed.
Gref thinks the bill will stimulate economic diversification and investment. He noted that many practical steps had been taken in Russia in recent years to diversify the economy. "The bill will allow us to re-orient our economy in favor of manufacturing industries," Gref said.
There are around 1,200 such zones in the world, from the United States to Western Europe, South East Asia and Cyprus. Though the bill offers "minimal tax privileges", it will become a real incentive for investment, Gref hopes.
At the same time, the economy minister did not rule out that some companies might use special economic zones for tax evasion. Prime minister Mikhail Fradkov also noted that Russia already had negative experience with free economic areas, which he said should be taken into account.
OAO RZD Invests RUR20 bln to Increase Safety of Rail Traffic
During next three years OAO RZD is to invest over 20 bln. roubles to implement a program aimed at increasing safety of rail traffic.
On April 26, this fact was voiced by RZD CEO Gennady Fadeyev at the telephone conference, which discussed safety of rail traffic.
"The Russian rail transport is currently the safest mode of transport. The last Board meeting decided to quarterly hold meetings on safety of rail traffic," Gennady Fadeyev said. "Providing of rail traffic safety is closely connected with RZD activities and needs serious investments. During three years the investments into the program on increasing rail traffic safety will exceed 20 bln. roubles."
It should be recalled that the decision to develop a programme aimed at perfecting the safety management system on the basis of sophisticated IT and information transmission devices was adopted at the Board meeting on this March 16. In addition, the Board approved the proposal to develop a program on re-equipping passenger locos with state-of-art safety traffic systems and install on railway bed low-ground and post devices of digital radio-communication in 2006-2010.
Chechen President and Rosneft Head Discuss Establishment of New Oil Company
Chechen President Alu Alkhanov meet Rosneft head Sergey Bogdanchikov. The two parties have discussed the establishment of the Chechen Oil Company among other issues.
Rosneft is the only company producing oil in the Chechen republic via its subsidiary Grozneftegaz. Rosneft is to allocate the major part of revenue from sales of oil produced in the republic for rebuilding projects. Nevertheless, regional authorities insist on the establishment of a Chechen-based oil company.
Rosneft wants to boost oil production in the Chechen republic by 12.2 percent in 2005 to 2.2m tons. Gas production is targeted to grow 4 percent to 530m cubic meters. Investments in oil production are to reach RUR640bn (around USD22.85bn).
[~DETAIL_TEXT] => A major European oil and gas producer, Norway's Norsk Hydro, has long been keen on operating in Russia.
According to Company's president and chief executive officer Eivind Reiten, Russia could use Norsk hydro as a possible place to house a primary aluminum plant.
At present, the company cooperates with Russian Aluminum that supplies it with its own products that Norsk Hydro sells on the European and American markets.
Last year, Gazprom announced that it could team up with Norsk Hydro on developing the Shtokman gas field. According to Reiten, he has regularly seen top managers of Gazprom. Norsk Hydro has been considering various concepts of developing the Shtokman field for a long time. One of the early concepts provided for a platform to be set up on the shelf. Now the company ponders a different approach that makes provision for underwater gas field development and transporting gas to the shore via a pipeline. Gas treatment facilities are to be built on shore. The company is going to export liquefied natural gas to the United States once the gas field starts yielding gas.
Asked about the share in the Shtokman field Norsk Hydro would like to get, Reiten mentioned 15%.
According to him, proceeding from the cost of the first stage, estimated at $8-10 billion, Norsk Hydro is ready to provide 15% of investment in the project.
The company is calm as regards the initiative of the Russian Ministry of Natural Resources to restrict foreigners" participation in the companies developing strategic deposits to minority shares.
"We have never sought to dominate any Russian project, therefore, this will not affect us," the Norsk Hydro president said.
The company produced 28.5 million tons of oil and 852 million cu.m of natural gas in 2004. It ranks third in producing aluminum and aluminum products. In 2004, Norsk Hydro's operating revenues totaled 18.9 billion euros, with its profit standing at 1.5 billion euros. Its capitalization equaled $21.4 billion as of April 11, 2004.
Iran-Azerbaijan Railway Line Agreement Signed
Railway chiefs of Azerbaijan, Iran and Russia have signed an agreement for construction of a railway line linking Qazvin (Iran), Rasht (Iran) and Astara (Azerbaijan).
The Qazvin-Rasht-Astara railway line will become a key component of the international north-south transport corridor. Currently, Russian Railways are negotiating over the possibility that Finnish railroads resume bulk paper-transportation to Iran.
OAO RZD is ready to assume commitments to finance a final feasibility study and business plan development as part of its share in the project. Construction is to be gradual. First, it will be completed in Azerbaijan, and afterwards in Iran, where at least 400 kilometers of railways are to be built. Funds to finance it will be allocated in installments by Russia, Azerbaijan, Iran, and other creditors.
RZD and Deutsche Bahn Signed an Agreement to Set up Joint Venture
OAO RZD and Railion Deutschland AG have signed an agreement on the foundation of Railion-Russia joint enterprise.
On the 11th of April in Hannover, in the framework of the Hannover fair, Gennady Fadeyev, the President of OAO RZD, and Hartmud Medorn, the Chair of the Administration of Deutsche Bahn AG (that holds 100% of Railion Deutschland AG shares), signed an agreement on cooperation in the field of International freight traffic. The key point of the agreement is the foundation of the Railion-Russia joint enterprise.
A declaration of the foundation of this joint enterprise was signed in Berlin on the 17th of September 2004.
The prerequisites for creating this enterprise have been the growth of trade between Germany and Russia, the growth of railway transport of International freight, and the dynamic development of the countries in Asian-Pacific region. They actively trade with European Union: experts estimate the goods turnover between EC and Asian-Pacific region to be $650 billion in 2005, which is to further grow by 25-30% by 2010.
The agreement signed says about the joint development of International freight railway service between Russia and Germany within International transport corridor 2 up to China.
The main task of the enterprise is to increase railway traffic and to balance transport flows within International transport corridor 2, as well as to make railway transport more competitive than other types of transport.
Railion-Russia will provide an integrated "through" service connecting Russia and Germany. The joint enterprise will coordinate freight transport along Russian, Byelorussian, Polish, and German railways on the basis of agreements with corresponding railways. The enterprise will be registered in the Russian Federation. The parties are to prepare a plan of the business-project by the end of May.
The joint enterprise will have not only to cross four State borders but also to adapt to different transport regulation systems, customs and border formalities, and different track gauges (1.520 mm in Russia as opposed to 1.435 mm in Europe).
Experts say that the joint enterprise will be competitive due to the optimization of transportation process, elimination of intermediary agents (which significantly increase the traffic costs), coordinated freight transport along Russian, Byelorussian, Polish, and German railways, and providing additional accompanying, customs and other services.
"The joint enterprise will create favourable conditions for economic relationships between our countries, make railway transport more competitive, and attract more traffic. We plan to decrease the traffic cost, increase the service quality, and expedite the freight delivery that should attract new customers', commented Gennady Fadeyev, the CEO of OAO RZD.
usd 100 Mln IFC Loan for Port
The International Finance Corporation, the World Bank's private lending unit, will provide $100 million to Russky Mir, Russia's largest private rail transporter of oil, to build a petroleum port on the Black Sea.
IFC's board on April 29 approved two loans totaling $100 million, Olga Platonova, an official at Russky Mir's financial department, said in a note on May 3, 2005.
The project will require investment of at least $264 million.
Russia Suspends Import Duty on Iron Ore
Russia will suspend the 5% import duty on iron ores and concentrates for a period of nine months.
Russian Prime Minister Mikhail Fradkov signed a resolution lifting the duties on non-agglomerated and agglomerated iron ores and concentrates (customs classification TN VED 2601 11 000 0 and 2601 12 000 0).
The resolution enters into effect a month after its official publication.
Gov't Approves Bill on Special Economic Zones
In March, the Russian government approved in principle the bill "On special economic zones." The bill was finalized within the next two weeks, after which it will be sent to the State Duma.
It envisages the creation of two kinds of free economic zone in Russia - technical and promotional, and industrial and manufacturing. The bill also introduces customs and tax privileges for businesses operating in those areas.
According to the economy ministry, the first economic zones will start working in 2007. This project will attract investors and help diversify the Russian economy, economy ministry officials hope.
Economy minister German Gref said residents of special economic zones were individual or commercial enterprises, who signed agreements with local authorities to conduct business in special economic zones. Residents of manufacturing and industrial economic zones will have to invest at least EUR 10 million to get permission to conduct business. Another EUR 1 million is to be invested within a year after the agreement is signed.
"We plan that state investment will be provided 50/50 by federal and regional authorities," economy minister Gref said. Special economic zones will be created by the government on a competitive basis. The Cabinet and regional authorities will sign agreements defining the obligations of federal and regional authorities regarding the period during which special economic zones should be created, and the necessary investment and infrastructure.
The economy ministry suggests exempting the residents of special economic zones from tax on property and land for a period of five years. They will also be exempt from import taxes - a measure aimed at stimulating export-oriented businesses and attracting investment in the manufacturing sector.
According to the bill, such zones will be free customs areas, where foreign goods will be moved without payment of customs tariffs, taxes and without applying other economic restrictions envisaged by legislation on state regulation of foreign trade. Rules for the export of goods will be applied in special economic zones; excise duties will be paid.
Customs tariffs and taxes will be paid on foreign and Russian goods moved from special economic zones into other regions of the country, in accordance with Russian customs and tax laws. Import tariffs and taxes will not be paid on such goods exported from Russia, while export taxes will be paid.
The economy ministry offers to lower the single social tax for technical and promotional zones. Gref said the single social tax rate in such zones will be 14 percent a month for people with wages up to $700 a month; 5.9 percent for those with wages between $700 and $2,000, and 2 percent for taxpayers with wages above $2,000. The economy minister noted that this would create optimal conditions for scientific research.
He proposed that more significant privileges should be offered to some special economic areas such as East Siberia and the Far East. Gref went even further, suggesting "huge" tax exemptions for 10-15 years for Sakhalin and Kamchatka. "The most important thing is that investment comes in," he stressed.
Gref thinks the bill will stimulate economic diversification and investment. He noted that many practical steps had been taken in Russia in recent years to diversify the economy. "The bill will allow us to re-orient our economy in favor of manufacturing industries," Gref said.
There are around 1,200 such zones in the world, from the United States to Western Europe, South East Asia and Cyprus. Though the bill offers "minimal tax privileges", it will become a real incentive for investment, Gref hopes.
At the same time, the economy minister did not rule out that some companies might use special economic zones for tax evasion. Prime minister Mikhail Fradkov also noted that Russia already had negative experience with free economic areas, which he said should be taken into account.
OAO RZD Invests RUR20 bln to Increase Safety of Rail Traffic
During next three years OAO RZD is to invest over 20 bln. roubles to implement a program aimed at increasing safety of rail traffic.
On April 26, this fact was voiced by RZD CEO Gennady Fadeyev at the telephone conference, which discussed safety of rail traffic.
"The Russian rail transport is currently the safest mode of transport. The last Board meeting decided to quarterly hold meetings on safety of rail traffic," Gennady Fadeyev said. "Providing of rail traffic safety is closely connected with RZD activities and needs serious investments. During three years the investments into the program on increasing rail traffic safety will exceed 20 bln. roubles."
It should be recalled that the decision to develop a programme aimed at perfecting the safety management system on the basis of sophisticated IT and information transmission devices was adopted at the Board meeting on this March 16. In addition, the Board approved the proposal to develop a program on re-equipping passenger locos with state-of-art safety traffic systems and install on railway bed low-ground and post devices of digital radio-communication in 2006-2010.
Chechen President and Rosneft Head Discuss Establishment of New Oil Company
Chechen President Alu Alkhanov meet Rosneft head Sergey Bogdanchikov. The two parties have discussed the establishment of the Chechen Oil Company among other issues.
Rosneft is the only company producing oil in the Chechen republic via its subsidiary Grozneftegaz. Rosneft is to allocate the major part of revenue from sales of oil produced in the republic for rebuilding projects. Nevertheless, regional authorities insist on the establishment of a Chechen-based oil company.
Rosneft wants to boost oil production in the Chechen republic by 12.2 percent in 2005 to 2.2m tons. Gas production is targeted to grow 4 percent to 530m cubic meters. Investments in oil production are to reach RUR640bn (around USD22.85bn).
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Some facts from history
The way of the market economy Russia chose in the beginning of 1990-s and start of the state reforms greatly transformed the previous terms of the transport sector functioning and altered character of demand on transport services. During the first decade significant structural and institutional reorganization was made, functions of the state control and economy were separated, adequate to the market calls system of the state regulation was created. At the same time in spite of the general familiarization with the new economic relation the state of transport system couldn't be regarded as an optimal and the level of development as a sufficient. In this respect in 1997 the RF Government approved the Concept of the state's transport policy that became the first state programme of modern Russia regulating the transport system development. Though as the RF Transport Minister Igor Levitin noted by the present time the most part of this document's issues has been accomplished and some lost their importance. That was the reason the RF Government approved a new document on April 28, 2005 that is going to give a new start for the sector. The basic principle of the new internal policy of Russia in the transport and transport infrastructure sector has become carrying on with administrative-control and economy functions of the state separation. Generally it will be aimed at social expenditures decrease and transport sector control efficiency and safety increase. At the same time the programme developers note growing transport demands satisfaction shouldn't contradict the priorities of environment protection and break future generations interests. Within the framework of the principle "polluter is to pay" transport services producers should pay for all the negative ecological consequences they caused (from resources consumption to vehicles and transport activities waste utilizaton.)
<>Regional Basis
The basis for a spatial model of supporting transport net development described in the "Transport Strategy of the Russian Federation till 2020" is made up by transregional transport corridors joint with the international transport corridors of the European and Asian transport nets. At the same time there is a great difference in the level of the Russian regions development that envisages a differentiated attitude to the problems of the transport sector and make this attitude support on the territorial character. In this respect the regions with advanced potential of industrial capacities and high population density where speeded development of high-technological industries and services is forecasted should hope for outstrip way of cargo and passenger motor transportation as well as personal cars intensive growth. In the area of transport infrastructure the badly needed factors here are coordinated development of competing modes of transport, road net carrying capacity expanding, motor tracks bypassing cities construction and multimodal transport terminals construction. The regions with promoted raw material base and low population density (northern territories especially) will be characterized by impressive concentrated flows of energy, ore, timber and chemical cargo transported at distances of 4-5 thousand kilometers, included significant volumes destined for export. In these regions the task on completion supporting railway net is highly important as well as making most part of inhabited localities connected with it all year round by means of access lines construction. The fact that inland water transport and regional aviation are the basic modes of transport needs taking special steps to support them.
In those regions where agricultural complex plays the major role local motor track net should be constructed in order to provide all the inhabited localities with access lines.
The level of the federal areas is considered to be the most appropriate level to coordinate transport strategy of the state with certain regions priorities development.
North-West
The most important role in Russia's export-import links and transit transportation the North-West federal okrug (area) plays. The major task of the transport system development for this region will become formation of the Russian parts of the Euro-Asian transport corridors "North - South" and "North Sea Route" and corridors of regional importance - pan-European transport corridors ь 1 and ь 9. In the system of the international transport corridor "North - South" inland water ways use is supposed to be activated including the Volgo-Baltic channel, sea ports for making shipping with sea-river type vessels towards North Europe - countries of the Caspian region with passage to the Black sea and the Danube further on. The priority directions for the region transport infrastructure development are believed to be port complexes modernization and construction in the area of the Baltic sea, White sea and the sea of Barents. At the same time railway, motor track and pipeline access lines construction should be undertaken as well as formation and making transport links of the Kaliningrad region with other regions of Russia function in a stable way. Important role in the voyaging development will play modernization of the passenger port arrival and the Central yacht-club in Saint-Petersburg. The major task for railway sector development will become access lines construction towards the Baltic sea ports and infrastructure groundwork for Saint-Petersburg - Buslovskaya sector to let organization of high-speed communication Saint -Petersburg - Helsinki and further railway infrastructure of Saint-Petersburg development.
Sea transport development envisages scheduled shipping organization in the western sector of the North Sea route as well as complex system establishment capable of providing secure shipping in the Baltic region. In the motor track sector altogether with roads included into Saint-Petersburg road junction development certain steps are going to be taken on construction and reconstruction of the following routes: Saint-Petersburg - Vologda - Kirov and further on to the Ural, Vologda - Medvezhyegorsk, Saint-Petersburg - Petrozavodsk - Kotlas - Syktyvkar - Vorkuta - Salekhard (with access to Naryan-Mar), Perm - Kudymkar - Syktyvkar - Arkhangelsk (with access to Mezen) Roads by-passing such cities as Saint-Petersburg, Pskov, Vologda, Veliky Novgorod will be constructed.
The most complicated task of transport system development in this region is setting up railway, motor and ferry-boat communication with the Kaliningrad region. At the same time problems of free land transit via the territories of the EU members should be solved. In the Kaliningrad region the following roads are planned to be constructed and renovated: Poland border -Kaliningrad - Tolpaki - Neman (by-passing Sovetska) and Kaliningrad - Chernyakhovsk - Lithuaninan border
Central Russia
On the territory of the central Federal okrug (area) the biggest transport junction of Russia (Moscow transport junction (MTJ) is located. That is a place where TransSiberian transport corridor and "North - South" transport corridor cross. This area possesses elaborated transport system which major development tasks are technology modernization, competition and services quality rise as well as sustaining stable transport functioning under conditions of growing traffic intensity.
The basic ways for railway transport modernization of the MTJ are going to be: speeded trains launch for the routes Moscow - Minsk, Moscow - Saint-Petersburg - Helsinki, Moscow - Nizhny Novgorod, Moscow - Samara, transfer of cargo loading/unloading procedures out of the the Moscow ring railway area, modern technologies of suburban transportation development. As perspective projects to be implemented within motor track infrastructure development are supposed to be reconstruction of the head sectors of the following federal routes starting from Moscow- "Belarus", "Russia", "Ukraine", "Kholmogory" and "Volga". Here making public road of 6-8 strips capacity and further on of 4-stripped capacity for the whole area is going to be undertaken. In order to unload radial lines of the Moscow motor junction chord and joint roads are to be constructed..
It is planned to build bypassing roads for such cities as Yaroslavl, Kostroma, Tula, Kursk, Voronezh, Ryazan, Saratov, Oryol. Construction of motor track Ukraine border - Kursk - Voronezh - Saratov - Uralsk that offers the shortest route out from the Central Europe to Kazakhstan and China will be completed. For air transport sector development the major task to fulfill is the Moscow air junction complex modernization that concerns "Sheremetyevo", "Domodedovo", "Vnukovo" airports reconstruction. This modernization is destined at hub net establishment capable of performing functions of air transport distribution centers in order to satisfy growing demands for domestic and foreign transit flights and also to increase flight safety. Moreover, high-speed motor tracks and railways connecting the airports and the central part of Moscow are planned to be constructed according to the plan of the Moscow air junction development.
South
Transport system of this part of the country performs as "South gates of Russia" that gives access to transport communications of the Black sea and TransCaspian regions. Due to this very reason transport system development of the South federal okrug provides for two major tasks solution. The first one concerns communications development in the "North -South" international transport corridor in order to sustain export-import transportation and international transit and also to attract cargo flows from the Caspian region, Iran, the Indian ocean countries towards the Russian routes. The second is meant to satisfy recreation opportunities of the Trans Black sea region.
According to the strategic plans of the transport system development by 2010 modernization of Astrakhan water junction, the port of Makhachkala will have been completed, ferry-boat transportation in the Caspian region will be developed further on. At the same time handling complexes of the port of Novorossyisk will be expanded to increase oil, grain and container volumes. Construction of the new port at Zhelezny Rog cape will be finished. In order to improve ecology in Taganrog the measures on bearing loading/unloading zone for dusty type cargo out of the port of Taganrog are going to be taken. That is a reason for a new freight port in Miussky estuary construction. In the motor track sector besides "Don", "Kaspyi", "Kavkaz" and other federal lines of the "North - South" international transport corridor development more routes such as Rostov-na-Donu - Budyonovsk - Kislyakovka - Timashevsk - Krymsk, Mineralnye Vody - Kochubeisk, Maikop - Dagomys, Armavir - Stavropol - Elista are planned to be constructed. Also motor track Ukraine border - Volgograd - Astrakhan- Kazakhstan border (Atyrau) is going to be reconstructed that will give a chance of the shortest access to Kazakhstan and Middle Asia from Europe.
Moreover the bridge via the Volga river near Volgograd city is planned to be finished.
A set of tasks connected with development of recreation opportunities of the Black sea of Russia keeps this territory protected from the negative influence of the transport net and blockages transport junctions and net construction in this area especially of those that have much to do with cargo transportation. Communication within the health-resorts areas should be serviced by transport systems of high ecological safety.
At the same time in order to improve access to the Russian sector of the Black sea technical re-equipment and reconstruction of aerodrome complexes of Sochi, Vladikavkaz, Mineralnye Vody, Krasnodar and Stavropol will be undertaken.
Privolzhsky federal okrug (Trans Volga federal area)
Favourable transport-geographical location of this area influences greatly its trade and industrial complexes formation. The transport engineering plants of principle importance are situated here, thus transport system development can become a key to economic growth for the most part of this territory. Trans Volga area transport system development is closely connected with competition rise for "North-South" international transport corridor. The most important goal to make the transport strategy work is hydro-technical complex in the area of Gorodets establishment in order to keep the Volga as a key shipping route indissoluble.
At the same time to increase transportation efficiency and quality for the domestic and international routes cargo railway stations reconstruction, cargo distribution centers construction as well as logistic centers of intermodal transportation control will be made.
According to the development plans, there will be held reconstruction of the federal motor tracks and development of motor track sector for the routes Perm - Kudymkar - Syktyvkar - Arkhangelsk, Kazan - Yekaterinburg, Nizhny Novgorod - Penza - Saratov, Kazan - Saransk - Tambov.
The bridge construction via the Volga near Ulyanovsk city is planned to be completed, by-passing routes for Perm, Nizhny Novgorod, Saratov are going to be built.
Ural
Transport system of the Ural federal okrug maintains the oldest Russian industrial region development as well as opening up perspective deposits of mineral resources. The major communications of the region supporting transport net are connected with the TransSiberian transport corridor. Their modernization is a key task in order to lengthen the European transport corridor ь 2 up to Yekaterinburg. Altogether with the TranSib development the major task for railway main lines development is completion the construction of Novyi Urengoy - Yamburg and Novyi Urengoi - Nadym railways.
Also the problem of transport communications development towards Kazakhstan and China is going to be solved that can result in additional transit cargo flows from the Asian-Pacific region attraction to Russia in the near future. One of the priority tasks for nowadays is creation of up-to-date system of transport-forwarding service and terminals in different modes of transport junctions. Now the basic transport logistic centers are biggest industrial and transport junctions such as Yekaterinburg and Chelyabinsk. In order to cope with motor transportation growing volumes some sectors of motor tracks are to be constructed and renovated (Perm - Serov - Khanty-Mansiysk - Surgut - Tomsk, Tyumen - Surgut - Novyi Urengoy - Salekhard)
Siberia
Tasks on transport system of the Siberian federal okrug modernization and development are not the same for different parts of the area. For the south regions of Siberia the following steps taking is badly needed: to develop communication within TransSiberian transport corridor further on, to construct railway in Chita region bound to the biggest in the world Udokansky copper deposit, to complete construction of the federal motor routes "Baikal", "Yenisey", Chita - Zabaikalsk - border, Tyumen - Yalutorovsk - Ishim - Omsk. Road construction is also planned for the regions to be opened up in the north of the Irkutsk region. In order to give direct access lines to China road sectors close to the state border in the south part of the region will be reconstructed in Evenki National District. Within river transport existing shipping capacities should be kept as they are for the Ob river of Irtysh and Yenisey basins and the upper reaches of the Lena river. For the north regions of Siberia the major task to fulfill is construction and development of meridian supporting motor tracks as well as the North Sea route development. For coastal and island Arctic regions sea transport is the only alternative. Its role will be inestimable for Norilsk mining-metallurgic complex production transportation including timber export deliveries from Igarka. Yamal peninsula transport development is regarded as a problem of particular importance. A top-priority task for the Siberian airport net development is believed to be a new airport construction in Omsk. Moreover reconstruction of landing strips in Novosibirsk (Tolmachyovo) is going to be undertaken as well as construction of cargo complexes of 300 tonnes per day capacity in Novosibirsk airport.
Far East
In spite of the fact that the Far East federal okrug covers 40% of the Russian territory, transport net here isn't developed enough that restrains economy growth rate seriously. Favourable opportunities for expanding international trade relations, first of all with the Asian-Pacific region are not totally exploited. That is why a priority task for Siberia transport development for the near future is completion of the supporting railway net that means GlavSib's strengthening, Baikal-Amur and Amur-Yakutsk main lines finishing, construction of joint lines providing the system's flexibility. Also the international transit flow (international transport corridors "TransSib", "Primorye-1", "Primorye-2") is going to be attracted after maintenance-technological and economic conditions creation. Berkakit - Tommot - Yakutsk railway is planned to be completed as well. As a necessary complex of tasks for the near future can be considered work on Sakhalin railways reconstruction, ferry-boat bridge Vanino - Kholmsk modernization, motor track Lidoga-Vanino putting into operation and mainland ports handling capacities development (the ports of Vladivostok, Nakhodka, Vostochny, Vanino, Pociet, Zarubino) The major task for motor construction is supporting road net establishment. Besides completion of the federal route Chita - Khabarovsk construction some more roads are planned to be built. In first turn those ones which can provide access to the ports of Vanino and Nakhodka. Also the following roads are to be constructed: Yakutsk -Mirny - Lensk, Komsomolsk-on-Amur - Nikolayev-on-Amur, Bilibino - Pomolom, Razdolnoye -Khasan, Yuzhno-Sakhakinsk - Nogliki. For river transport sector after Amur-Yakutsk railway launch and a basic port transfer to Yakutsk the most perspective projects are depths support in the Lena river upper reaches (Osetrovo - Vitim sector) and the Lena and Amur basins fleet expanding with river-sea vessels.
Summing Up
Despite hard competition with other modes of transport railway transportation in long-term perspective will preserve its status and remain the most economically efficient way of transporting significant volumes of stable flows of mass cargo delivered at medium and long distances. Railway transport efficiency will be defined by dynamics of renewal the basic assets of the sector, demand for the sector services growth, results of the structural reform, tariff policy flexibility and Russian parts of the international transport corridors use.
Till 2010 the major role on the market of cargo and passenger transportation will be taken by OAO RZD that possesses all the railway transport infrastructure of general use.
Generally, approval of "Transport Strategy of the Russian Federation till 2020" vividly showed the Russian transport sector potential being great. And coordinated activities of all the branches of power, business and society can help rise of remarkable transport sector capacities destined at social-economic development of Russia.
German Nutels
[~DETAIL_TEXT] =>
Some facts from history
The way of the market economy Russia chose in the beginning of 1990-s and start of the state reforms greatly transformed the previous terms of the transport sector functioning and altered character of demand on transport services. During the first decade significant structural and institutional reorganization was made, functions of the state control and economy were separated, adequate to the market calls system of the state regulation was created. At the same time in spite of the general familiarization with the new economic relation the state of transport system couldn't be regarded as an optimal and the level of development as a sufficient. In this respect in 1997 the RF Government approved the Concept of the state's transport policy that became the first state programme of modern Russia regulating the transport system development. Though as the RF Transport Minister Igor Levitin noted by the present time the most part of this document's issues has been accomplished and some lost their importance. That was the reason the RF Government approved a new document on April 28, 2005 that is going to give a new start for the sector. The basic principle of the new internal policy of Russia in the transport and transport infrastructure sector has become carrying on with administrative-control and economy functions of the state separation. Generally it will be aimed at social expenditures decrease and transport sector control efficiency and safety increase. At the same time the programme developers note growing transport demands satisfaction shouldn't contradict the priorities of environment protection and break future generations interests. Within the framework of the principle "polluter is to pay" transport services producers should pay for all the negative ecological consequences they caused (from resources consumption to vehicles and transport activities waste utilizaton.)
<>Regional Basis
The basis for a spatial model of supporting transport net development described in the "Transport Strategy of the Russian Federation till 2020" is made up by transregional transport corridors joint with the international transport corridors of the European and Asian transport nets. At the same time there is a great difference in the level of the Russian regions development that envisages a differentiated attitude to the problems of the transport sector and make this attitude support on the territorial character. In this respect the regions with advanced potential of industrial capacities and high population density where speeded development of high-technological industries and services is forecasted should hope for outstrip way of cargo and passenger motor transportation as well as personal cars intensive growth. In the area of transport infrastructure the badly needed factors here are coordinated development of competing modes of transport, road net carrying capacity expanding, motor tracks bypassing cities construction and multimodal transport terminals construction. The regions with promoted raw material base and low population density (northern territories especially) will be characterized by impressive concentrated flows of energy, ore, timber and chemical cargo transported at distances of 4-5 thousand kilometers, included significant volumes destined for export. In these regions the task on completion supporting railway net is highly important as well as making most part of inhabited localities connected with it all year round by means of access lines construction. The fact that inland water transport and regional aviation are the basic modes of transport needs taking special steps to support them.
In those regions where agricultural complex plays the major role local motor track net should be constructed in order to provide all the inhabited localities with access lines.
The level of the federal areas is considered to be the most appropriate level to coordinate transport strategy of the state with certain regions priorities development.
North-West
The most important role in Russia's export-import links and transit transportation the North-West federal okrug (area) plays. The major task of the transport system development for this region will become formation of the Russian parts of the Euro-Asian transport corridors "North - South" and "North Sea Route" and corridors of regional importance - pan-European transport corridors ь 1 and ь 9. In the system of the international transport corridor "North - South" inland water ways use is supposed to be activated including the Volgo-Baltic channel, sea ports for making shipping with sea-river type vessels towards North Europe - countries of the Caspian region with passage to the Black sea and the Danube further on. The priority directions for the region transport infrastructure development are believed to be port complexes modernization and construction in the area of the Baltic sea, White sea and the sea of Barents. At the same time railway, motor track and pipeline access lines construction should be undertaken as well as formation and making transport links of the Kaliningrad region with other regions of Russia function in a stable way. Important role in the voyaging development will play modernization of the passenger port arrival and the Central yacht-club in Saint-Petersburg. The major task for railway sector development will become access lines construction towards the Baltic sea ports and infrastructure groundwork for Saint-Petersburg - Buslovskaya sector to let organization of high-speed communication Saint -Petersburg - Helsinki and further railway infrastructure of Saint-Petersburg development.
Sea transport development envisages scheduled shipping organization in the western sector of the North Sea route as well as complex system establishment capable of providing secure shipping in the Baltic region. In the motor track sector altogether with roads included into Saint-Petersburg road junction development certain steps are going to be taken on construction and reconstruction of the following routes: Saint-Petersburg - Vologda - Kirov and further on to the Ural, Vologda - Medvezhyegorsk, Saint-Petersburg - Petrozavodsk - Kotlas - Syktyvkar - Vorkuta - Salekhard (with access to Naryan-Mar), Perm - Kudymkar - Syktyvkar - Arkhangelsk (with access to Mezen) Roads by-passing such cities as Saint-Petersburg, Pskov, Vologda, Veliky Novgorod will be constructed.
The most complicated task of transport system development in this region is setting up railway, motor and ferry-boat communication with the Kaliningrad region. At the same time problems of free land transit via the territories of the EU members should be solved. In the Kaliningrad region the following roads are planned to be constructed and renovated: Poland border -Kaliningrad - Tolpaki - Neman (by-passing Sovetska) and Kaliningrad - Chernyakhovsk - Lithuaninan border
Central Russia
On the territory of the central Federal okrug (area) the biggest transport junction of Russia (Moscow transport junction (MTJ) is located. That is a place where TransSiberian transport corridor and "North - South" transport corridor cross. This area possesses elaborated transport system which major development tasks are technology modernization, competition and services quality rise as well as sustaining stable transport functioning under conditions of growing traffic intensity.
The basic ways for railway transport modernization of the MTJ are going to be: speeded trains launch for the routes Moscow - Minsk, Moscow - Saint-Petersburg - Helsinki, Moscow - Nizhny Novgorod, Moscow - Samara, transfer of cargo loading/unloading procedures out of the the Moscow ring railway area, modern technologies of suburban transportation development. As perspective projects to be implemented within motor track infrastructure development are supposed to be reconstruction of the head sectors of the following federal routes starting from Moscow- "Belarus", "Russia", "Ukraine", "Kholmogory" and "Volga". Here making public road of 6-8 strips capacity and further on of 4-stripped capacity for the whole area is going to be undertaken. In order to unload radial lines of the Moscow motor junction chord and joint roads are to be constructed..
It is planned to build bypassing roads for such cities as Yaroslavl, Kostroma, Tula, Kursk, Voronezh, Ryazan, Saratov, Oryol. Construction of motor track Ukraine border - Kursk - Voronezh - Saratov - Uralsk that offers the shortest route out from the Central Europe to Kazakhstan and China will be completed. For air transport sector development the major task to fulfill is the Moscow air junction complex modernization that concerns "Sheremetyevo", "Domodedovo", "Vnukovo" airports reconstruction. This modernization is destined at hub net establishment capable of performing functions of air transport distribution centers in order to satisfy growing demands for domestic and foreign transit flights and also to increase flight safety. Moreover, high-speed motor tracks and railways connecting the airports and the central part of Moscow are planned to be constructed according to the plan of the Moscow air junction development.
South
Transport system of this part of the country performs as "South gates of Russia" that gives access to transport communications of the Black sea and TransCaspian regions. Due to this very reason transport system development of the South federal okrug provides for two major tasks solution. The first one concerns communications development in the "North -South" international transport corridor in order to sustain export-import transportation and international transit and also to attract cargo flows from the Caspian region, Iran, the Indian ocean countries towards the Russian routes. The second is meant to satisfy recreation opportunities of the Trans Black sea region.
According to the strategic plans of the transport system development by 2010 modernization of Astrakhan water junction, the port of Makhachkala will have been completed, ferry-boat transportation in the Caspian region will be developed further on. At the same time handling complexes of the port of Novorossyisk will be expanded to increase oil, grain and container volumes. Construction of the new port at Zhelezny Rog cape will be finished. In order to improve ecology in Taganrog the measures on bearing loading/unloading zone for dusty type cargo out of the port of Taganrog are going to be taken. That is a reason for a new freight port in Miussky estuary construction. In the motor track sector besides "Don", "Kaspyi", "Kavkaz" and other federal lines of the "North - South" international transport corridor development more routes such as Rostov-na-Donu - Budyonovsk - Kislyakovka - Timashevsk - Krymsk, Mineralnye Vody - Kochubeisk, Maikop - Dagomys, Armavir - Stavropol - Elista are planned to be constructed. Also motor track Ukraine border - Volgograd - Astrakhan- Kazakhstan border (Atyrau) is going to be reconstructed that will give a chance of the shortest access to Kazakhstan and Middle Asia from Europe.
Moreover the bridge via the Volga river near Volgograd city is planned to be finished.
A set of tasks connected with development of recreation opportunities of the Black sea of Russia keeps this territory protected from the negative influence of the transport net and blockages transport junctions and net construction in this area especially of those that have much to do with cargo transportation. Communication within the health-resorts areas should be serviced by transport systems of high ecological safety.
At the same time in order to improve access to the Russian sector of the Black sea technical re-equipment and reconstruction of aerodrome complexes of Sochi, Vladikavkaz, Mineralnye Vody, Krasnodar and Stavropol will be undertaken.
Privolzhsky federal okrug (Trans Volga federal area)
Favourable transport-geographical location of this area influences greatly its trade and industrial complexes formation. The transport engineering plants of principle importance are situated here, thus transport system development can become a key to economic growth for the most part of this territory. Trans Volga area transport system development is closely connected with competition rise for "North-South" international transport corridor. The most important goal to make the transport strategy work is hydro-technical complex in the area of Gorodets establishment in order to keep the Volga as a key shipping route indissoluble.
At the same time to increase transportation efficiency and quality for the domestic and international routes cargo railway stations reconstruction, cargo distribution centers construction as well as logistic centers of intermodal transportation control will be made.
According to the development plans, there will be held reconstruction of the federal motor tracks and development of motor track sector for the routes Perm - Kudymkar - Syktyvkar - Arkhangelsk, Kazan - Yekaterinburg, Nizhny Novgorod - Penza - Saratov, Kazan - Saransk - Tambov.
The bridge construction via the Volga near Ulyanovsk city is planned to be completed, by-passing routes for Perm, Nizhny Novgorod, Saratov are going to be built.
Ural
Transport system of the Ural federal okrug maintains the oldest Russian industrial region development as well as opening up perspective deposits of mineral resources. The major communications of the region supporting transport net are connected with the TransSiberian transport corridor. Their modernization is a key task in order to lengthen the European transport corridor ь 2 up to Yekaterinburg. Altogether with the TranSib development the major task for railway main lines development is completion the construction of Novyi Urengoy - Yamburg and Novyi Urengoi - Nadym railways.
Also the problem of transport communications development towards Kazakhstan and China is going to be solved that can result in additional transit cargo flows from the Asian-Pacific region attraction to Russia in the near future. One of the priority tasks for nowadays is creation of up-to-date system of transport-forwarding service and terminals in different modes of transport junctions. Now the basic transport logistic centers are biggest industrial and transport junctions such as Yekaterinburg and Chelyabinsk. In order to cope with motor transportation growing volumes some sectors of motor tracks are to be constructed and renovated (Perm - Serov - Khanty-Mansiysk - Surgut - Tomsk, Tyumen - Surgut - Novyi Urengoy - Salekhard)
Siberia
Tasks on transport system of the Siberian federal okrug modernization and development are not the same for different parts of the area. For the south regions of Siberia the following steps taking is badly needed: to develop communication within TransSiberian transport corridor further on, to construct railway in Chita region bound to the biggest in the world Udokansky copper deposit, to complete construction of the federal motor routes "Baikal", "Yenisey", Chita - Zabaikalsk - border, Tyumen - Yalutorovsk - Ishim - Omsk. Road construction is also planned for the regions to be opened up in the north of the Irkutsk region. In order to give direct access lines to China road sectors close to the state border in the south part of the region will be reconstructed in Evenki National District. Within river transport existing shipping capacities should be kept as they are for the Ob river of Irtysh and Yenisey basins and the upper reaches of the Lena river. For the north regions of Siberia the major task to fulfill is construction and development of meridian supporting motor tracks as well as the North Sea route development. For coastal and island Arctic regions sea transport is the only alternative. Its role will be inestimable for Norilsk mining-metallurgic complex production transportation including timber export deliveries from Igarka. Yamal peninsula transport development is regarded as a problem of particular importance. A top-priority task for the Siberian airport net development is believed to be a new airport construction in Omsk. Moreover reconstruction of landing strips in Novosibirsk (Tolmachyovo) is going to be undertaken as well as construction of cargo complexes of 300 tonnes per day capacity in Novosibirsk airport.
Far East
In spite of the fact that the Far East federal okrug covers 40% of the Russian territory, transport net here isn't developed enough that restrains economy growth rate seriously. Favourable opportunities for expanding international trade relations, first of all with the Asian-Pacific region are not totally exploited. That is why a priority task for Siberia transport development for the near future is completion of the supporting railway net that means GlavSib's strengthening, Baikal-Amur and Amur-Yakutsk main lines finishing, construction of joint lines providing the system's flexibility. Also the international transit flow (international transport corridors "TransSib", "Primorye-1", "Primorye-2") is going to be attracted after maintenance-technological and economic conditions creation. Berkakit - Tommot - Yakutsk railway is planned to be completed as well. As a necessary complex of tasks for the near future can be considered work on Sakhalin railways reconstruction, ferry-boat bridge Vanino - Kholmsk modernization, motor track Lidoga-Vanino putting into operation and mainland ports handling capacities development (the ports of Vladivostok, Nakhodka, Vostochny, Vanino, Pociet, Zarubino) The major task for motor construction is supporting road net establishment. Besides completion of the federal route Chita - Khabarovsk construction some more roads are planned to be built. In first turn those ones which can provide access to the ports of Vanino and Nakhodka. Also the following roads are to be constructed: Yakutsk -Mirny - Lensk, Komsomolsk-on-Amur - Nikolayev-on-Amur, Bilibino - Pomolom, Razdolnoye -Khasan, Yuzhno-Sakhakinsk - Nogliki. For river transport sector after Amur-Yakutsk railway launch and a basic port transfer to Yakutsk the most perspective projects are depths support in the Lena river upper reaches (Osetrovo - Vitim sector) and the Lena and Amur basins fleet expanding with river-sea vessels.
Summing Up
Despite hard competition with other modes of transport railway transportation in long-term perspective will preserve its status and remain the most economically efficient way of transporting significant volumes of stable flows of mass cargo delivered at medium and long distances. Railway transport efficiency will be defined by dynamics of renewal the basic assets of the sector, demand for the sector services growth, results of the structural reform, tariff policy flexibility and Russian parts of the international transport corridors use.
Till 2010 the major role on the market of cargo and passenger transportation will be taken by OAO RZD that possesses all the railway transport infrastructure of general use.
Generally, approval of "Transport Strategy of the Russian Federation till 2020" vividly showed the Russian transport sector potential being great. And coordinated activities of all the branches of power, business and society can help rise of remarkable transport sector capacities destined at social-economic development of Russia.
German Nutels
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[SECTION_META_DESCRIPTION] => On April 28, 2005 the RF Government approved a new programme document "Transport Strategy of the Russian Federation till 2020" that was created to give a new stimulus for the whole transport system of the state. What are its basic issues?<BR>
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Some facts from history
The way of the market economy Russia chose in the beginning of 1990-s and start of the state reforms greatly transformed the previous terms of the transport sector functioning and altered character of demand on transport services. During the first decade significant structural and institutional reorganization was made, functions of the state control and economy were separated, adequate to the market calls system of the state regulation was created. At the same time in spite of the general familiarization with the new economic relation the state of transport system couldn't be regarded as an optimal and the level of development as a sufficient. In this respect in 1997 the RF Government approved the Concept of the state's transport policy that became the first state programme of modern Russia regulating the transport system development. Though as the RF Transport Minister Igor Levitin noted by the present time the most part of this document's issues has been accomplished and some lost their importance. That was the reason the RF Government approved a new document on April 28, 2005 that is going to give a new start for the sector. The basic principle of the new internal policy of Russia in the transport and transport infrastructure sector has become carrying on with administrative-control and economy functions of the state separation. Generally it will be aimed at social expenditures decrease and transport sector control efficiency and safety increase. At the same time the programme developers note growing transport demands satisfaction shouldn't contradict the priorities of environment protection and break future generations interests. Within the framework of the principle "polluter is to pay" transport services producers should pay for all the negative ecological consequences they caused (from resources consumption to vehicles and transport activities waste utilizaton.)
<>Regional Basis
The basis for a spatial model of supporting transport net development described in the "Transport Strategy of the Russian Federation till 2020" is made up by transregional transport corridors joint with the international transport corridors of the European and Asian transport nets. At the same time there is a great difference in the level of the Russian regions development that envisages a differentiated attitude to the problems of the transport sector and make this attitude support on the territorial character. In this respect the regions with advanced potential of industrial capacities and high population density where speeded development of high-technological industries and services is forecasted should hope for outstrip way of cargo and passenger motor transportation as well as personal cars intensive growth. In the area of transport infrastructure the badly needed factors here are coordinated development of competing modes of transport, road net carrying capacity expanding, motor tracks bypassing cities construction and multimodal transport terminals construction. The regions with promoted raw material base and low population density (northern territories especially) will be characterized by impressive concentrated flows of energy, ore, timber and chemical cargo transported at distances of 4-5 thousand kilometers, included significant volumes destined for export. In these regions the task on completion supporting railway net is highly important as well as making most part of inhabited localities connected with it all year round by means of access lines construction. The fact that inland water transport and regional aviation are the basic modes of transport needs taking special steps to support them.
In those regions where agricultural complex plays the major role local motor track net should be constructed in order to provide all the inhabited localities with access lines.
The level of the federal areas is considered to be the most appropriate level to coordinate transport strategy of the state with certain regions priorities development.
North-West
The most important role in Russia's export-import links and transit transportation the North-West federal okrug (area) plays. The major task of the transport system development for this region will become formation of the Russian parts of the Euro-Asian transport corridors "North - South" and "North Sea Route" and corridors of regional importance - pan-European transport corridors ь 1 and ь 9. In the system of the international transport corridor "North - South" inland water ways use is supposed to be activated including the Volgo-Baltic channel, sea ports for making shipping with sea-river type vessels towards North Europe - countries of the Caspian region with passage to the Black sea and the Danube further on. The priority directions for the region transport infrastructure development are believed to be port complexes modernization and construction in the area of the Baltic sea, White sea and the sea of Barents. At the same time railway, motor track and pipeline access lines construction should be undertaken as well as formation and making transport links of the Kaliningrad region with other regions of Russia function in a stable way. Important role in the voyaging development will play modernization of the passenger port arrival and the Central yacht-club in Saint-Petersburg. The major task for railway sector development will become access lines construction towards the Baltic sea ports and infrastructure groundwork for Saint-Petersburg - Buslovskaya sector to let organization of high-speed communication Saint -Petersburg - Helsinki and further railway infrastructure of Saint-Petersburg development.
Sea transport development envisages scheduled shipping organization in the western sector of the North Sea route as well as complex system establishment capable of providing secure shipping in the Baltic region. In the motor track sector altogether with roads included into Saint-Petersburg road junction development certain steps are going to be taken on construction and reconstruction of the following routes: Saint-Petersburg - Vologda - Kirov and further on to the Ural, Vologda - Medvezhyegorsk, Saint-Petersburg - Petrozavodsk - Kotlas - Syktyvkar - Vorkuta - Salekhard (with access to Naryan-Mar), Perm - Kudymkar - Syktyvkar - Arkhangelsk (with access to Mezen) Roads by-passing such cities as Saint-Petersburg, Pskov, Vologda, Veliky Novgorod will be constructed.
The most complicated task of transport system development in this region is setting up railway, motor and ferry-boat communication with the Kaliningrad region. At the same time problems of free land transit via the territories of the EU members should be solved. In the Kaliningrad region the following roads are planned to be constructed and renovated: Poland border -Kaliningrad - Tolpaki - Neman (by-passing Sovetska) and Kaliningrad - Chernyakhovsk - Lithuaninan border
Central Russia
On the territory of the central Federal okrug (area) the biggest transport junction of Russia (Moscow transport junction (MTJ) is located. That is a place where TransSiberian transport corridor and "North - South" transport corridor cross. This area possesses elaborated transport system which major development tasks are technology modernization, competition and services quality rise as well as sustaining stable transport functioning under conditions of growing traffic intensity.
The basic ways for railway transport modernization of the MTJ are going to be: speeded trains launch for the routes Moscow - Minsk, Moscow - Saint-Petersburg - Helsinki, Moscow - Nizhny Novgorod, Moscow - Samara, transfer of cargo loading/unloading procedures out of the the Moscow ring railway area, modern technologies of suburban transportation development. As perspective projects to be implemented within motor track infrastructure development are supposed to be reconstruction of the head sectors of the following federal routes starting from Moscow- "Belarus", "Russia", "Ukraine", "Kholmogory" and "Volga". Here making public road of 6-8 strips capacity and further on of 4-stripped capacity for the whole area is going to be undertaken. In order to unload radial lines of the Moscow motor junction chord and joint roads are to be constructed..
It is planned to build bypassing roads for such cities as Yaroslavl, Kostroma, Tula, Kursk, Voronezh, Ryazan, Saratov, Oryol. Construction of motor track Ukraine border - Kursk - Voronezh - Saratov - Uralsk that offers the shortest route out from the Central Europe to Kazakhstan and China will be completed. For air transport sector development the major task to fulfill is the Moscow air junction complex modernization that concerns "Sheremetyevo", "Domodedovo", "Vnukovo" airports reconstruction. This modernization is destined at hub net establishment capable of performing functions of air transport distribution centers in order to satisfy growing demands for domestic and foreign transit flights and also to increase flight safety. Moreover, high-speed motor tracks and railways connecting the airports and the central part of Moscow are planned to be constructed according to the plan of the Moscow air junction development.
South
Transport system of this part of the country performs as "South gates of Russia" that gives access to transport communications of the Black sea and TransCaspian regions. Due to this very reason transport system development of the South federal okrug provides for two major tasks solution. The first one concerns communications development in the "North -South" international transport corridor in order to sustain export-import transportation and international transit and also to attract cargo flows from the Caspian region, Iran, the Indian ocean countries towards the Russian routes. The second is meant to satisfy recreation opportunities of the Trans Black sea region.
According to the strategic plans of the transport system development by 2010 modernization of Astrakhan water junction, the port of Makhachkala will have been completed, ferry-boat transportation in the Caspian region will be developed further on. At the same time handling complexes of the port of Novorossyisk will be expanded to increase oil, grain and container volumes. Construction of the new port at Zhelezny Rog cape will be finished. In order to improve ecology in Taganrog the measures on bearing loading/unloading zone for dusty type cargo out of the port of Taganrog are going to be taken. That is a reason for a new freight port in Miussky estuary construction. In the motor track sector besides "Don", "Kaspyi", "Kavkaz" and other federal lines of the "North - South" international transport corridor development more routes such as Rostov-na-Donu - Budyonovsk - Kislyakovka - Timashevsk - Krymsk, Mineralnye Vody - Kochubeisk, Maikop - Dagomys, Armavir - Stavropol - Elista are planned to be constructed. Also motor track Ukraine border - Volgograd - Astrakhan- Kazakhstan border (Atyrau) is going to be reconstructed that will give a chance of the shortest access to Kazakhstan and Middle Asia from Europe.
Moreover the bridge via the Volga river near Volgograd city is planned to be finished.
A set of tasks connected with development of recreation opportunities of the Black sea of Russia keeps this territory protected from the negative influence of the transport net and blockages transport junctions and net construction in this area especially of those that have much to do with cargo transportation. Communication within the health-resorts areas should be serviced by transport systems of high ecological safety.
At the same time in order to improve access to the Russian sector of the Black sea technical re-equipment and reconstruction of aerodrome complexes of Sochi, Vladikavkaz, Mineralnye Vody, Krasnodar and Stavropol will be undertaken.
Privolzhsky federal okrug (Trans Volga federal area)
Favourable transport-geographical location of this area influences greatly its trade and industrial complexes formation. The transport engineering plants of principle importance are situated here, thus transport system development can become a key to economic growth for the most part of this territory. Trans Volga area transport system development is closely connected with competition rise for "North-South" international transport corridor. The most important goal to make the transport strategy work is hydro-technical complex in the area of Gorodets establishment in order to keep the Volga as a key shipping route indissoluble.
At the same time to increase transportation efficiency and quality for the domestic and international routes cargo railway stations reconstruction, cargo distribution centers construction as well as logistic centers of intermodal transportation control will be made.
According to the development plans, there will be held reconstruction of the federal motor tracks and development of motor track sector for the routes Perm - Kudymkar - Syktyvkar - Arkhangelsk, Kazan - Yekaterinburg, Nizhny Novgorod - Penza - Saratov, Kazan - Saransk - Tambov.
The bridge construction via the Volga near Ulyanovsk city is planned to be completed, by-passing routes for Perm, Nizhny Novgorod, Saratov are going to be built.
Ural
Transport system of the Ural federal okrug maintains the oldest Russian industrial region development as well as opening up perspective deposits of mineral resources. The major communications of the region supporting transport net are connected with the TransSiberian transport corridor. Their modernization is a key task in order to lengthen the European transport corridor ь 2 up to Yekaterinburg. Altogether with the TranSib development the major task for railway main lines development is completion the construction of Novyi Urengoy - Yamburg and Novyi Urengoi - Nadym railways.
Also the problem of transport communications development towards Kazakhstan and China is going to be solved that can result in additional transit cargo flows from the Asian-Pacific region attraction to Russia in the near future. One of the priority tasks for nowadays is creation of up-to-date system of transport-forwarding service and terminals in different modes of transport junctions. Now the basic transport logistic centers are biggest industrial and transport junctions such as Yekaterinburg and Chelyabinsk. In order to cope with motor transportation growing volumes some sectors of motor tracks are to be constructed and renovated (Perm - Serov - Khanty-Mansiysk - Surgut - Tomsk, Tyumen - Surgut - Novyi Urengoy - Salekhard)
Siberia
Tasks on transport system of the Siberian federal okrug modernization and development are not the same for different parts of the area. For the south regions of Siberia the following steps taking is badly needed: to develop communication within TransSiberian transport corridor further on, to construct railway in Chita region bound to the biggest in the world Udokansky copper deposit, to complete construction of the federal motor routes "Baikal", "Yenisey", Chita - Zabaikalsk - border, Tyumen - Yalutorovsk - Ishim - Omsk. Road construction is also planned for the regions to be opened up in the north of the Irkutsk region. In order to give direct access lines to China road sectors close to the state border in the south part of the region will be reconstructed in Evenki National District. Within river transport existing shipping capacities should be kept as they are for the Ob river of Irtysh and Yenisey basins and the upper reaches of the Lena river. For the north regions of Siberia the major task to fulfill is construction and development of meridian supporting motor tracks as well as the North Sea route development. For coastal and island Arctic regions sea transport is the only alternative. Its role will be inestimable for Norilsk mining-metallurgic complex production transportation including timber export deliveries from Igarka. Yamal peninsula transport development is regarded as a problem of particular importance. A top-priority task for the Siberian airport net development is believed to be a new airport construction in Omsk. Moreover reconstruction of landing strips in Novosibirsk (Tolmachyovo) is going to be undertaken as well as construction of cargo complexes of 300 tonnes per day capacity in Novosibirsk airport.
Far East
In spite of the fact that the Far East federal okrug covers 40% of the Russian territory, transport net here isn't developed enough that restrains economy growth rate seriously. Favourable opportunities for expanding international trade relations, first of all with the Asian-Pacific region are not totally exploited. That is why a priority task for Siberia transport development for the near future is completion of the supporting railway net that means GlavSib's strengthening, Baikal-Amur and Amur-Yakutsk main lines finishing, construction of joint lines providing the system's flexibility. Also the international transit flow (international transport corridors "TransSib", "Primorye-1", "Primorye-2") is going to be attracted after maintenance-technological and economic conditions creation. Berkakit - Tommot - Yakutsk railway is planned to be completed as well. As a necessary complex of tasks for the near future can be considered work on Sakhalin railways reconstruction, ferry-boat bridge Vanino - Kholmsk modernization, motor track Lidoga-Vanino putting into operation and mainland ports handling capacities development (the ports of Vladivostok, Nakhodka, Vostochny, Vanino, Pociet, Zarubino) The major task for motor construction is supporting road net establishment. Besides completion of the federal route Chita - Khabarovsk construction some more roads are planned to be built. In first turn those ones which can provide access to the ports of Vanino and Nakhodka. Also the following roads are to be constructed: Yakutsk -Mirny - Lensk, Komsomolsk-on-Amur - Nikolayev-on-Amur, Bilibino - Pomolom, Razdolnoye -Khasan, Yuzhno-Sakhakinsk - Nogliki. For river transport sector after Amur-Yakutsk railway launch and a basic port transfer to Yakutsk the most perspective projects are depths support in the Lena river upper reaches (Osetrovo - Vitim sector) and the Lena and Amur basins fleet expanding with river-sea vessels.
Summing Up
Despite hard competition with other modes of transport railway transportation in long-term perspective will preserve its status and remain the most economically efficient way of transporting significant volumes of stable flows of mass cargo delivered at medium and long distances. Railway transport efficiency will be defined by dynamics of renewal the basic assets of the sector, demand for the sector services growth, results of the structural reform, tariff policy flexibility and Russian parts of the international transport corridors use.
Till 2010 the major role on the market of cargo and passenger transportation will be taken by OAO RZD that possesses all the railway transport infrastructure of general use.
Generally, approval of "Transport Strategy of the Russian Federation till 2020" vividly showed the Russian transport sector potential being great. And coordinated activities of all the branches of power, business and society can help rise of remarkable transport sector capacities destined at social-economic development of Russia.
German Nutels
[~DETAIL_TEXT] =>
Some facts from history
The way of the market economy Russia chose in the beginning of 1990-s and start of the state reforms greatly transformed the previous terms of the transport sector functioning and altered character of demand on transport services. During the first decade significant structural and institutional reorganization was made, functions of the state control and economy were separated, adequate to the market calls system of the state regulation was created. At the same time in spite of the general familiarization with the new economic relation the state of transport system couldn't be regarded as an optimal and the level of development as a sufficient. In this respect in 1997 the RF Government approved the Concept of the state's transport policy that became the first state programme of modern Russia regulating the transport system development. Though as the RF Transport Minister Igor Levitin noted by the present time the most part of this document's issues has been accomplished and some lost their importance. That was the reason the RF Government approved a new document on April 28, 2005 that is going to give a new start for the sector. The basic principle of the new internal policy of Russia in the transport and transport infrastructure sector has become carrying on with administrative-control and economy functions of the state separation. Generally it will be aimed at social expenditures decrease and transport sector control efficiency and safety increase. At the same time the programme developers note growing transport demands satisfaction shouldn't contradict the priorities of environment protection and break future generations interests. Within the framework of the principle "polluter is to pay" transport services producers should pay for all the negative ecological consequences they caused (from resources consumption to vehicles and transport activities waste utilizaton.)
<>Regional Basis
The basis for a spatial model of supporting transport net development described in the "Transport Strategy of the Russian Federation till 2020" is made up by transregional transport corridors joint with the international transport corridors of the European and Asian transport nets. At the same time there is a great difference in the level of the Russian regions development that envisages a differentiated attitude to the problems of the transport sector and make this attitude support on the territorial character. In this respect the regions with advanced potential of industrial capacities and high population density where speeded development of high-technological industries and services is forecasted should hope for outstrip way of cargo and passenger motor transportation as well as personal cars intensive growth. In the area of transport infrastructure the badly needed factors here are coordinated development of competing modes of transport, road net carrying capacity expanding, motor tracks bypassing cities construction and multimodal transport terminals construction. The regions with promoted raw material base and low population density (northern territories especially) will be characterized by impressive concentrated flows of energy, ore, timber and chemical cargo transported at distances of 4-5 thousand kilometers, included significant volumes destined for export. In these regions the task on completion supporting railway net is highly important as well as making most part of inhabited localities connected with it all year round by means of access lines construction. The fact that inland water transport and regional aviation are the basic modes of transport needs taking special steps to support them.
In those regions where agricultural complex plays the major role local motor track net should be constructed in order to provide all the inhabited localities with access lines.
The level of the federal areas is considered to be the most appropriate level to coordinate transport strategy of the state with certain regions priorities development.
North-West
The most important role in Russia's export-import links and transit transportation the North-West federal okrug (area) plays. The major task of the transport system development for this region will become formation of the Russian parts of the Euro-Asian transport corridors "North - South" and "North Sea Route" and corridors of regional importance - pan-European transport corridors ь 1 and ь 9. In the system of the international transport corridor "North - South" inland water ways use is supposed to be activated including the Volgo-Baltic channel, sea ports for making shipping with sea-river type vessels towards North Europe - countries of the Caspian region with passage to the Black sea and the Danube further on. The priority directions for the region transport infrastructure development are believed to be port complexes modernization and construction in the area of the Baltic sea, White sea and the sea of Barents. At the same time railway, motor track and pipeline access lines construction should be undertaken as well as formation and making transport links of the Kaliningrad region with other regions of Russia function in a stable way. Important role in the voyaging development will play modernization of the passenger port arrival and the Central yacht-club in Saint-Petersburg. The major task for railway sector development will become access lines construction towards the Baltic sea ports and infrastructure groundwork for Saint-Petersburg - Buslovskaya sector to let organization of high-speed communication Saint -Petersburg - Helsinki and further railway infrastructure of Saint-Petersburg development.
Sea transport development envisages scheduled shipping organization in the western sector of the North Sea route as well as complex system establishment capable of providing secure shipping in the Baltic region. In the motor track sector altogether with roads included into Saint-Petersburg road junction development certain steps are going to be taken on construction and reconstruction of the following routes: Saint-Petersburg - Vologda - Kirov and further on to the Ural, Vologda - Medvezhyegorsk, Saint-Petersburg - Petrozavodsk - Kotlas - Syktyvkar - Vorkuta - Salekhard (with access to Naryan-Mar), Perm - Kudymkar - Syktyvkar - Arkhangelsk (with access to Mezen) Roads by-passing such cities as Saint-Petersburg, Pskov, Vologda, Veliky Novgorod will be constructed.
The most complicated task of transport system development in this region is setting up railway, motor and ferry-boat communication with the Kaliningrad region. At the same time problems of free land transit via the territories of the EU members should be solved. In the Kaliningrad region the following roads are planned to be constructed and renovated: Poland border -Kaliningrad - Tolpaki - Neman (by-passing Sovetska) and Kaliningrad - Chernyakhovsk - Lithuaninan border
Central Russia
On the territory of the central Federal okrug (area) the biggest transport junction of Russia (Moscow transport junction (MTJ) is located. That is a place where TransSiberian transport corridor and "North - South" transport corridor cross. This area possesses elaborated transport system which major development tasks are technology modernization, competition and services quality rise as well as sustaining stable transport functioning under conditions of growing traffic intensity.
The basic ways for railway transport modernization of the MTJ are going to be: speeded trains launch for the routes Moscow - Minsk, Moscow - Saint-Petersburg - Helsinki, Moscow - Nizhny Novgorod, Moscow - Samara, transfer of cargo loading/unloading procedures out of the the Moscow ring railway area, modern technologies of suburban transportation development. As perspective projects to be implemented within motor track infrastructure development are supposed to be reconstruction of the head sectors of the following federal routes starting from Moscow- "Belarus", "Russia", "Ukraine", "Kholmogory" and "Volga". Here making public road of 6-8 strips capacity and further on of 4-stripped capacity for the whole area is going to be undertaken. In order to unload radial lines of the Moscow motor junction chord and joint roads are to be constructed..
It is planned to build bypassing roads for such cities as Yaroslavl, Kostroma, Tula, Kursk, Voronezh, Ryazan, Saratov, Oryol. Construction of motor track Ukraine border - Kursk - Voronezh - Saratov - Uralsk that offers the shortest route out from the Central Europe to Kazakhstan and China will be completed. For air transport sector development the major task to fulfill is the Moscow air junction complex modernization that concerns "Sheremetyevo", "Domodedovo", "Vnukovo" airports reconstruction. This modernization is destined at hub net establishment capable of performing functions of air transport distribution centers in order to satisfy growing demands for domestic and foreign transit flights and also to increase flight safety. Moreover, high-speed motor tracks and railways connecting the airports and the central part of Moscow are planned to be constructed according to the plan of the Moscow air junction development.
South
Transport system of this part of the country performs as "South gates of Russia" that gives access to transport communications of the Black sea and TransCaspian regions. Due to this very reason transport system development of the South federal okrug provides for two major tasks solution. The first one concerns communications development in the "North -South" international transport corridor in order to sustain export-import transportation and international transit and also to attract cargo flows from the Caspian region, Iran, the Indian ocean countries towards the Russian routes. The second is meant to satisfy recreation opportunities of the Trans Black sea region.
According to the strategic plans of the transport system development by 2010 modernization of Astrakhan water junction, the port of Makhachkala will have been completed, ferry-boat transportation in the Caspian region will be developed further on. At the same time handling complexes of the port of Novorossyisk will be expanded to increase oil, grain and container volumes. Construction of the new port at Zhelezny Rog cape will be finished. In order to improve ecology in Taganrog the measures on bearing loading/unloading zone for dusty type cargo out of the port of Taganrog are going to be taken. That is a reason for a new freight port in Miussky estuary construction. In the motor track sector besides "Don", "Kaspyi", "Kavkaz" and other federal lines of the "North - South" international transport corridor development more routes such as Rostov-na-Donu - Budyonovsk - Kislyakovka - Timashevsk - Krymsk, Mineralnye Vody - Kochubeisk, Maikop - Dagomys, Armavir - Stavropol - Elista are planned to be constructed. Also motor track Ukraine border - Volgograd - Astrakhan- Kazakhstan border (Atyrau) is going to be reconstructed that will give a chance of the shortest access to Kazakhstan and Middle Asia from Europe.
Moreover the bridge via the Volga river near Volgograd city is planned to be finished.
A set of tasks connected with development of recreation opportunities of the Black sea of Russia keeps this territory protected from the negative influence of the transport net and blockages transport junctions and net construction in this area especially of those that have much to do with cargo transportation. Communication within the health-resorts areas should be serviced by transport systems of high ecological safety.
At the same time in order to improve access to the Russian sector of the Black sea technical re-equipment and reconstruction of aerodrome complexes of Sochi, Vladikavkaz, Mineralnye Vody, Krasnodar and Stavropol will be undertaken.
Privolzhsky federal okrug (Trans Volga federal area)
Favourable transport-geographical location of this area influences greatly its trade and industrial complexes formation. The transport engineering plants of principle importance are situated here, thus transport system development can become a key to economic growth for the most part of this territory. Trans Volga area transport system development is closely connected with competition rise for "North-South" international transport corridor. The most important goal to make the transport strategy work is hydro-technical complex in the area of Gorodets establishment in order to keep the Volga as a key shipping route indissoluble.
At the same time to increase transportation efficiency and quality for the domestic and international routes cargo railway stations reconstruction, cargo distribution centers construction as well as logistic centers of intermodal transportation control will be made.
According to the development plans, there will be held reconstruction of the federal motor tracks and development of motor track sector for the routes Perm - Kudymkar - Syktyvkar - Arkhangelsk, Kazan - Yekaterinburg, Nizhny Novgorod - Penza - Saratov, Kazan - Saransk - Tambov.
The bridge construction via the Volga near Ulyanovsk city is planned to be completed, by-passing routes for Perm, Nizhny Novgorod, Saratov are going to be built.
Ural
Transport system of the Ural federal okrug maintains the oldest Russian industrial region development as well as opening up perspective deposits of mineral resources. The major communications of the region supporting transport net are connected with the TransSiberian transport corridor. Their modernization is a key task in order to lengthen the European transport corridor ь 2 up to Yekaterinburg. Altogether with the TranSib development the major task for railway main lines development is completion the construction of Novyi Urengoy - Yamburg and Novyi Urengoi - Nadym railways.
Also the problem of transport communications development towards Kazakhstan and China is going to be solved that can result in additional transit cargo flows from the Asian-Pacific region attraction to Russia in the near future. One of the priority tasks for nowadays is creation of up-to-date system of transport-forwarding service and terminals in different modes of transport junctions. Now the basic transport logistic centers are biggest industrial and transport junctions such as Yekaterinburg and Chelyabinsk. In order to cope with motor transportation growing volumes some sectors of motor tracks are to be constructed and renovated (Perm - Serov - Khanty-Mansiysk - Surgut - Tomsk, Tyumen - Surgut - Novyi Urengoy - Salekhard)
Siberia
Tasks on transport system of the Siberian federal okrug modernization and development are not the same for different parts of the area. For the south regions of Siberia the following steps taking is badly needed: to develop communication within TransSiberian transport corridor further on, to construct railway in Chita region bound to the biggest in the world Udokansky copper deposit, to complete construction of the federal motor routes "Baikal", "Yenisey", Chita - Zabaikalsk - border, Tyumen - Yalutorovsk - Ishim - Omsk. Road construction is also planned for the regions to be opened up in the north of the Irkutsk region. In order to give direct access lines to China road sectors close to the state border in the south part of the region will be reconstructed in Evenki National District. Within river transport existing shipping capacities should be kept as they are for the Ob river of Irtysh and Yenisey basins and the upper reaches of the Lena river. For the north regions of Siberia the major task to fulfill is construction and development of meridian supporting motor tracks as well as the North Sea route development. For coastal and island Arctic regions sea transport is the only alternative. Its role will be inestimable for Norilsk mining-metallurgic complex production transportation including timber export deliveries from Igarka. Yamal peninsula transport development is regarded as a problem of particular importance. A top-priority task for the Siberian airport net development is believed to be a new airport construction in Omsk. Moreover reconstruction of landing strips in Novosibirsk (Tolmachyovo) is going to be undertaken as well as construction of cargo complexes of 300 tonnes per day capacity in Novosibirsk airport.
Far East
In spite of the fact that the Far East federal okrug covers 40% of the Russian territory, transport net here isn't developed enough that restrains economy growth rate seriously. Favourable opportunities for expanding international trade relations, first of all with the Asian-Pacific region are not totally exploited. That is why a priority task for Siberia transport development for the near future is completion of the supporting railway net that means GlavSib's strengthening, Baikal-Amur and Amur-Yakutsk main lines finishing, construction of joint lines providing the system's flexibility. Also the international transit flow (international transport corridors "TransSib", "Primorye-1", "Primorye-2") is going to be attracted after maintenance-technological and economic conditions creation. Berkakit - Tommot - Yakutsk railway is planned to be completed as well. As a necessary complex of tasks for the near future can be considered work on Sakhalin railways reconstruction, ferry-boat bridge Vanino - Kholmsk modernization, motor track Lidoga-Vanino putting into operation and mainland ports handling capacities development (the ports of Vladivostok, Nakhodka, Vostochny, Vanino, Pociet, Zarubino) The major task for motor construction is supporting road net establishment. Besides completion of the federal route Chita - Khabarovsk construction some more roads are planned to be built. In first turn those ones which can provide access to the ports of Vanino and Nakhodka. Also the following roads are to be constructed: Yakutsk -Mirny - Lensk, Komsomolsk-on-Amur - Nikolayev-on-Amur, Bilibino - Pomolom, Razdolnoye -Khasan, Yuzhno-Sakhakinsk - Nogliki. For river transport sector after Amur-Yakutsk railway launch and a basic port transfer to Yakutsk the most perspective projects are depths support in the Lena river upper reaches (Osetrovo - Vitim sector) and the Lena and Amur basins fleet expanding with river-sea vessels.
Summing Up
Despite hard competition with other modes of transport railway transportation in long-term perspective will preserve its status and remain the most economically efficient way of transporting significant volumes of stable flows of mass cargo delivered at medium and long distances. Railway transport efficiency will be defined by dynamics of renewal the basic assets of the sector, demand for the sector services growth, results of the structural reform, tariff policy flexibility and Russian parts of the international transport corridors use.
Till 2010 the major role on the market of cargo and passenger transportation will be taken by OAO RZD that possesses all the railway transport infrastructure of general use.
Generally, approval of "Transport Strategy of the Russian Federation till 2020" vividly showed the Russian transport sector potential being great. And coordinated activities of all the branches of power, business and society can help rise of remarkable transport sector capacities destined at social-economic development of Russia.
German Nutels
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For the past period the controlling body was drastically re-formed, staffing procedures were carried on, new way for the Transport Ministry's interaction with subordinated newly-made Transport Agencies and Transport Service was worked out. Generally, the set target was reached though some problems to be made decision about are still remain. In 2005 the Ministry has to complete work on the documents that regulate its functioning as well as that of its subordinated departments.
Apart from the administrative reform the state transport policy has also undergone serious changes. As a result a set of programme documents predetermined to define the strategy of transport system development for long- and medium-term perspective were worked out. First of all, the Ministry of Transport Colleague approved the transport strategy of Russia up to 2020 and the RF transport development strategy up to 2010. The most important tool to accomplish the above-mentioned tasks has always been the Federal target programme "Russian Transport system modernization (2002 - 2010)". In 2004 it was amended in accordance with the modern calls and new tendencies of the state's economy development.
Also last year we witnessed a transfer to new budget planning mechanisms destined for programme-target indexes and a certain subject to estimation.
Much To Be Done
Today the state of technical base of the sector is quite troublesome, its wear and tear degree amounts to 60%. One of the major reasons that has caused it is poor transport financing. In 2002 - 2005 the sector received 17% less of the funds allocated by the programme "Transport system modernization" which is worth USD 2,5 bln. The situation in the road sector is especially complicated. In five years expenditures share for the road economy in the GDP structure of Russia got down from 2,9% in 2000 to 1,3% in 2004. As a result volume of new roads of general use being put into operation dropped from 7 thousand kilometers in 2000 to 1752 kilometers in 2004, road maintenance volume decreased by half. At the same time according to the World Bank system with the GDP growth by 7% per year macroeconomics needs of Russia for road net development are estimated at 17 thousand of new routes a year. Moreover, efficient control and way of budget funds expenditure have not been developed yet; mechanisms of competition trades and purchases are not transparent enough; budget funds often happen to be wasted on the objects of minor importance. And it is obvious our major problem is still low investment attractiveness of sector.
The way to change it leads to the road sector complex structural reform and active attraction of non-budget funds on the basis of public-private partnership. Thus, last year the development of some pilot-projects on toll road construction started with the help of financial and human resources of private stock. In February the contest on the projects of investment foundation for the high-speed motor track Moscow-Saint-Petersburg was held. In the near future the same contest is going to be held for the Central ring road project in the Moscow region. In parallel with that hard work on improvement of the legislative base for private business involved in such infrastructure projects is being carried on. First of all it is land and estate relations within transport sector that are closely connected with investment attractiveness of the sector and its stable functioning. This issue, in particular, was considered at the first session of the Governmental commission on the RF transport system complex development. A new bill "On concession agreements" that has already undergone the first reading in the State Duma is believed to be approved soon. As it is known concessions mechanism has been widely used in the world practice when in Russia it was actively employed in the second quarter of the 19th century in the initial construction of railways.
As mentioned before, the structural reform of road economy control is also discussed. By now the programme of first and foremost steps has already been prepared as well as a schedule for working out the Russian road sector reorganization concept. The RF Ministry of Transport is going to submit it to the Government in November. One of the major reform directions is going to become shortening exceeding enterprises in the state control sector. To accomplish this, 62 road economy enterprises and 49 motor transport enterprises were included into the privatization plan. Also the newest technologies role in transport complex shouldn't be underestimated as they can increase transport complex control efficiency, information and geoinformation technologies in first place. Now the works to establish the unified geoinformation system of complex planning and transport infrastructure monitoring development are carried on. This year promises favourable continuation of work on the unified infocommunication transport complex establishment which is based on the main line digital net of ОАО RZD. This system will perform as a necessary base and inalienable condition for the national net of transport-logistics centers formation. The unified system of cargo movement control and cargo owners transport expenditures optimization is planned to be set.
Natural Monopoly Reformed
Last September the reform's course of development was considered at the RF Government session. In particular, it was underlined that after demolition of the Ministry of Railways all the responsibility was laid upon the Ministry of Transport and now the Minister is in charge of the Governmental Programme of railway transport structural reform. In general today all the reorganization is going on according to the approved plans and all the processes happening are of positive character. At the first stage of the reform the state regulation and economy functions were divided. Within this stage OAO RZD was formed that holds practically the whole railway infrastructure, all the locomotive resources and over two thirds of car park, the company's functioning can be called stable and secure at the moment. Together with this there are more than 80 private operator companies and 50 of them own or rent about thousand rail cars each. In total Russia now operates about 250 thousand of private rail cars. Private investment into rolling stock purchase and renovation has reached about USD 2 bln. inthe last three years that can be regarded as the most important achievement of the reform. One more aspect of great importance is railway competition mechanisms starting up for OAO RZD and operators companies. Especially it concerns such sectors as oil and products, containers, perishable goods, mineral fertilizers and metals transportation.
Thus, positive results are obvious but on the whole the state should do its best not to let any failures happen in railway transport sector functioning, as the reform in this sector is strategically important for Russia.
However, the administrative reform has slightly suppressed railway reform. That can be seen in the periods of some arranged events accomplishment, in particular, it concerns urgent necessity of certain legislative-and-normative bill approval. Now the issue of greatest importance is still unsolved which is non-discriminative access to the infrastructure. The work on this is being done. Now Russia is at the second stage of the reform that envisages establishment of private carriers (having nearly a half of rolling stock) sovereign institution and consequent formation of competition in transportation and rail cars maintenance work sector. In parallel with that OAO RZD reorganization will be implemented by separation its affiliates off the company's structure according to their activities directions with their further sale. In 2005 about 20 affiliates will be separated. In particular, such sorts of business as track machinery production and maintenance, automated systems and telemechanics, specialized transportation in isothermal rolling stock, containerized transportation, scientific-technical complex, capital construction will be set apart. The next step is establishment of surburban passenger transportation companies, firms that deal with freight and passenger rail cars repairs and companies producing spare parts for cars. In 2007 the Federal passenger company is planned to be created whose whole stock of shares will be controlled by the RF Government. It is worth noting that hard work within legislative area is top-priority at a present moment. New bills must be approved by both the Government and the Ministry. The work is being accomplished in accordance with the plan sanctioned by the Government. It is guided by the Intersectoral Commission headed by the Transport Minister. In July the way of the reform unfolding is to be discussed at the RF session.
On Way To Global Market
The major result achieved by the country within international cooperation in 2004 is the fact that despite certain problems connected with the federal bodies reorganization it managed to keep dynamics and succession of contacts with foreign partners. At the same time the Ministry of Transport of the RF does its best to activate functioning in the international transport organizations while top-priority was given to the EU. Now the EU takes more than a half of Russia's foreign trade turnover that needs to be provided with proper transport services. In 2004 a good foundation was laid to implement some joint projects with Germany, Spain, Italy and Poland. The Ministry kept on working with the aim to stir up "transport dialogue" between Russia and the EU, including "25 + 1" model. Russia's part in transport cooperation with the Asian-Pacific region becomes more and more remarkable. Our country initiated the working group of the APEU transport session in Moscow in the second half of 2005. This initiative would allow to promote the RF in the Euro-Asian transport relations advantageously. Since July, 2004 Russia has headed the European Conference of the Ministers of Transport . During this period the international conference "Policy within stable development of city transport accomplishment" was organized and held as well as the international seminar "Regulatory Reform of Railways in Russia". However, the major event of the year will be the 89th session of ECMT held on May 24 - 25, in Moscow that puts an and to Russia's heading the Conference. Also on September 11-15 one more quite noticeable event will be held, i.e. the FIATA world congress. Without any doubt, this will become an outstanding event for Russian forwarding companies international relations promotion. It is worth mentioning Russia managed to get approval for the Convention on international customs transit procedure, while applying the bill of loading used in the CIS to cargo railway transportation. This was done within the framework of the Committee on domestic transport of the European Economic Commission UN. Due to Russia's initiative the problem of visa procedures simplification for the truck drivers working on the international routes was declared on the Committee's agenda. Today the Ministry has been functioning in the highly authorized EU group on formation of the development strategy of transport communications and relations between the EU and neighbouring countries for the next 15 years.
The problem of the borders check-points procedures sometimes considered the major obstacle for international transport cooperation influence Russia mostly in the process of truck hauliage: 17% of check-point service 75% of foreign trade turnover when via 30% of border check-points only five trucks can pass per day. In order to establish effective control system coordinating cargo movement via border the Ministry of Transport has developed a project on creating specialized federal department that would be authorized to operate all the check-points of Russia. The Transport Ministry commenced the work on complex certification of all the check-points to make the whole system balanced. According to this work results, proposals are to be submitted to the RF Government on opening or closing postd due to their efficiency rate.
Plans and prospects
Looking over the Russian export structure we can find such key elements as oil, metal, coal, mineral fertilizers etc. but you can never find transport services there. It is quite obvious the country can earn a lot on transit, offering foreign goods consignors to make use of our transport system. The RF Ministry of Transport submitted "Transit" federal target programme for approval. The body should simply analyze the market state and opportunities in this area without going into much detail of "general" investment into the railways, motor tracks and ports and define which international transport corridor is capable to get larger transportation volume. Having the "North - South" and the "West-East" (Transsib) international corridors, two pan-European corridors crossing the country's territory steps on making decision on boosting transit cargo flows must to be taken. Let us say, we need to set up certain number of check-points, make all the customs procedures transparent etc. Having done all this Russia gets a clear perspective on which routes foreign companies can be attracted. Or for example passenger transit: millions of people bypass Russia making stops at the country's neighbours. What does it show? Just that the country doesn't see potential profit and doesn't want to make money. Russian carriers face a constant problem of having no access to the foreign railways. It clearly shows what must be done in the first place. Moreover, Russia's export/import cargo freight costs USD 6 bln. per year. Russian carriers participate in it by 8-10%. But it is a transport services market! Other countries simply force their manufactures to apply for carriers' services under this condition, which provides them with a set of subsidies and privileges. But the country feels shy and does nothing except having heated discussions about competition. When the Russian international vessels register is approved at last, the time will come to transport domestic cargo under Russian flag. And it is transport services market as well.
International truck haulage developed quite dynamically last year. Their volumes grew up by 17,6%. At the same time the share of the Russian hauliers reached 38% though it was as little as one third not long ago. The country's prospect policy regarding this issue envisages a set of effective steps to elaborate Russia's position strengthening on the world truck haulage market and stimulation of the Russian companies competition. In particular, some legal acts are going to be approved that would set up a practice of foreign hauliers being tolled for the Russian road infrastructure utilizing. It should be said such practice has already become everyday reality for many countries in the world.
Today's Russia has become a platform for high-speed trains development that first of all has much to do with the line Moscow - Saint-Petersburg. Here we are speaking of two projects, they are high-speed rolling stock production and a new high-speed line construction. Now ОАО RZD together with Siemens AG are working out the project of a speeded train. The agreement has already been made and certain parameters are elaborated. The immediate contract is expected to be signed in summer. These trains production is planned to be launched in Moscow and first train is to appear in 2007. Moreover OAO RZD intends to hold present-day Moscow-Saint-Petersburg line reconstruction with the help of the company's funds in order to make this line adjusted to a speed of 250 km per hour. Another project is directed at a new line construction which is planned to be built to the west of already existing one. This line shows a qualitatively new approach to transportation at speed of 300 km per hour and even more, the basic methods of construction being totally different. Unfortunately, there are no lines of this sort in Russia yet. Today this project is being worked out in details that cover in particular financing schemes considering foreign investors participation. It would be worthwhile to realize the idea of special economic zones establishment where all the conditions for new technologies development will be given.
As a top-priority of the transport policy of the Russian Federation one can quote the formation of an up-to-date and elaborated infrastructure capable to allow for cargo and passenger transportation speeding up, transport expenditures in the economy decrease, industrial and mineral resources base advance as well as Russia's integration and its positions strengthening in the world market.
Andrey Guryev
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For the past period the controlling body was drastically re-formed, staffing procedures were carried on, new way for the Transport Ministry's interaction with subordinated newly-made Transport Agencies and Transport Service was worked out. Generally, the set target was reached though some problems to be made decision about are still remain. In 2005 the Ministry has to complete work on the documents that regulate its functioning as well as that of its subordinated departments.
Apart from the administrative reform the state transport policy has also undergone serious changes. As a result a set of programme documents predetermined to define the strategy of transport system development for long- and medium-term perspective were worked out. First of all, the Ministry of Transport Colleague approved the transport strategy of Russia up to 2020 and the RF transport development strategy up to 2010. The most important tool to accomplish the above-mentioned tasks has always been the Federal target programme "Russian Transport system modernization (2002 - 2010)". In 2004 it was amended in accordance with the modern calls and new tendencies of the state's economy development.
Also last year we witnessed a transfer to new budget planning mechanisms destined for programme-target indexes and a certain subject to estimation.
Much To Be Done
Today the state of technical base of the sector is quite troublesome, its wear and tear degree amounts to 60%. One of the major reasons that has caused it is poor transport financing. In 2002 - 2005 the sector received 17% less of the funds allocated by the programme "Transport system modernization" which is worth USD 2,5 bln. The situation in the road sector is especially complicated. In five years expenditures share for the road economy in the GDP structure of Russia got down from 2,9% in 2000 to 1,3% in 2004. As a result volume of new roads of general use being put into operation dropped from 7 thousand kilometers in 2000 to 1752 kilometers in 2004, road maintenance volume decreased by half. At the same time according to the World Bank system with the GDP growth by 7% per year macroeconomics needs of Russia for road net development are estimated at 17 thousand of new routes a year. Moreover, efficient control and way of budget funds expenditure have not been developed yet; mechanisms of competition trades and purchases are not transparent enough; budget funds often happen to be wasted on the objects of minor importance. And it is obvious our major problem is still low investment attractiveness of sector.
The way to change it leads to the road sector complex structural reform and active attraction of non-budget funds on the basis of public-private partnership. Thus, last year the development of some pilot-projects on toll road construction started with the help of financial and human resources of private stock. In February the contest on the projects of investment foundation for the high-speed motor track Moscow-Saint-Petersburg was held. In the near future the same contest is going to be held for the Central ring road project in the Moscow region. In parallel with that hard work on improvement of the legislative base for private business involved in such infrastructure projects is being carried on. First of all it is land and estate relations within transport sector that are closely connected with investment attractiveness of the sector and its stable functioning. This issue, in particular, was considered at the first session of the Governmental commission on the RF transport system complex development. A new bill "On concession agreements" that has already undergone the first reading in the State Duma is believed to be approved soon. As it is known concessions mechanism has been widely used in the world practice when in Russia it was actively employed in the second quarter of the 19th century in the initial construction of railways.
As mentioned before, the structural reform of road economy control is also discussed. By now the programme of first and foremost steps has already been prepared as well as a schedule for working out the Russian road sector reorganization concept. The RF Ministry of Transport is going to submit it to the Government in November. One of the major reform directions is going to become shortening exceeding enterprises in the state control sector. To accomplish this, 62 road economy enterprises and 49 motor transport enterprises were included into the privatization plan. Also the newest technologies role in transport complex shouldn't be underestimated as they can increase transport complex control efficiency, information and geoinformation technologies in first place. Now the works to establish the unified geoinformation system of complex planning and transport infrastructure monitoring development are carried on. This year promises favourable continuation of work on the unified infocommunication transport complex establishment which is based on the main line digital net of ОАО RZD. This system will perform as a necessary base and inalienable condition for the national net of transport-logistics centers formation. The unified system of cargo movement control and cargo owners transport expenditures optimization is planned to be set.
Natural Monopoly Reformed
Last September the reform's course of development was considered at the RF Government session. In particular, it was underlined that after demolition of the Ministry of Railways all the responsibility was laid upon the Ministry of Transport and now the Minister is in charge of the Governmental Programme of railway transport structural reform. In general today all the reorganization is going on according to the approved plans and all the processes happening are of positive character. At the first stage of the reform the state regulation and economy functions were divided. Within this stage OAO RZD was formed that holds practically the whole railway infrastructure, all the locomotive resources and over two thirds of car park, the company's functioning can be called stable and secure at the moment. Together with this there are more than 80 private operator companies and 50 of them own or rent about thousand rail cars each. In total Russia now operates about 250 thousand of private rail cars. Private investment into rolling stock purchase and renovation has reached about USD 2 bln. inthe last three years that can be regarded as the most important achievement of the reform. One more aspect of great importance is railway competition mechanisms starting up for OAO RZD and operators companies. Especially it concerns such sectors as oil and products, containers, perishable goods, mineral fertilizers and metals transportation.
Thus, positive results are obvious but on the whole the state should do its best not to let any failures happen in railway transport sector functioning, as the reform in this sector is strategically important for Russia.
However, the administrative reform has slightly suppressed railway reform. That can be seen in the periods of some arranged events accomplishment, in particular, it concerns urgent necessity of certain legislative-and-normative bill approval. Now the issue of greatest importance is still unsolved which is non-discriminative access to the infrastructure. The work on this is being done. Now Russia is at the second stage of the reform that envisages establishment of private carriers (having nearly a half of rolling stock) sovereign institution and consequent formation of competition in transportation and rail cars maintenance work sector. In parallel with that OAO RZD reorganization will be implemented by separation its affiliates off the company's structure according to their activities directions with their further sale. In 2005 about 20 affiliates will be separated. In particular, such sorts of business as track machinery production and maintenance, automated systems and telemechanics, specialized transportation in isothermal rolling stock, containerized transportation, scientific-technical complex, capital construction will be set apart. The next step is establishment of surburban passenger transportation companies, firms that deal with freight and passenger rail cars repairs and companies producing spare parts for cars. In 2007 the Federal passenger company is planned to be created whose whole stock of shares will be controlled by the RF Government. It is worth noting that hard work within legislative area is top-priority at a present moment. New bills must be approved by both the Government and the Ministry. The work is being accomplished in accordance with the plan sanctioned by the Government. It is guided by the Intersectoral Commission headed by the Transport Minister. In July the way of the reform unfolding is to be discussed at the RF session.
On Way To Global Market
The major result achieved by the country within international cooperation in 2004 is the fact that despite certain problems connected with the federal bodies reorganization it managed to keep dynamics and succession of contacts with foreign partners. At the same time the Ministry of Transport of the RF does its best to activate functioning in the international transport organizations while top-priority was given to the EU. Now the EU takes more than a half of Russia's foreign trade turnover that needs to be provided with proper transport services. In 2004 a good foundation was laid to implement some joint projects with Germany, Spain, Italy and Poland. The Ministry kept on working with the aim to stir up "transport dialogue" between Russia and the EU, including "25 + 1" model. Russia's part in transport cooperation with the Asian-Pacific region becomes more and more remarkable. Our country initiated the working group of the APEU transport session in Moscow in the second half of 2005. This initiative would allow to promote the RF in the Euro-Asian transport relations advantageously. Since July, 2004 Russia has headed the European Conference of the Ministers of Transport . During this period the international conference "Policy within stable development of city transport accomplishment" was organized and held as well as the international seminar "Regulatory Reform of Railways in Russia". However, the major event of the year will be the 89th session of ECMT held on May 24 - 25, in Moscow that puts an and to Russia's heading the Conference. Also on September 11-15 one more quite noticeable event will be held, i.e. the FIATA world congress. Without any doubt, this will become an outstanding event for Russian forwarding companies international relations promotion. It is worth mentioning Russia managed to get approval for the Convention on international customs transit procedure, while applying the bill of loading used in the CIS to cargo railway transportation. This was done within the framework of the Committee on domestic transport of the European Economic Commission UN. Due to Russia's initiative the problem of visa procedures simplification for the truck drivers working on the international routes was declared on the Committee's agenda. Today the Ministry has been functioning in the highly authorized EU group on formation of the development strategy of transport communications and relations between the EU and neighbouring countries for the next 15 years.
The problem of the borders check-points procedures sometimes considered the major obstacle for international transport cooperation influence Russia mostly in the process of truck hauliage: 17% of check-point service 75% of foreign trade turnover when via 30% of border check-points only five trucks can pass per day. In order to establish effective control system coordinating cargo movement via border the Ministry of Transport has developed a project on creating specialized federal department that would be authorized to operate all the check-points of Russia. The Transport Ministry commenced the work on complex certification of all the check-points to make the whole system balanced. According to this work results, proposals are to be submitted to the RF Government on opening or closing postd due to their efficiency rate.
Plans and prospects
Looking over the Russian export structure we can find such key elements as oil, metal, coal, mineral fertilizers etc. but you can never find transport services there. It is quite obvious the country can earn a lot on transit, offering foreign goods consignors to make use of our transport system. The RF Ministry of Transport submitted "Transit" federal target programme for approval. The body should simply analyze the market state and opportunities in this area without going into much detail of "general" investment into the railways, motor tracks and ports and define which international transport corridor is capable to get larger transportation volume. Having the "North - South" and the "West-East" (Transsib) international corridors, two pan-European corridors crossing the country's territory steps on making decision on boosting transit cargo flows must to be taken. Let us say, we need to set up certain number of check-points, make all the customs procedures transparent etc. Having done all this Russia gets a clear perspective on which routes foreign companies can be attracted. Or for example passenger transit: millions of people bypass Russia making stops at the country's neighbours. What does it show? Just that the country doesn't see potential profit and doesn't want to make money. Russian carriers face a constant problem of having no access to the foreign railways. It clearly shows what must be done in the first place. Moreover, Russia's export/import cargo freight costs USD 6 bln. per year. Russian carriers participate in it by 8-10%. But it is a transport services market! Other countries simply force their manufactures to apply for carriers' services under this condition, which provides them with a set of subsidies and privileges. But the country feels shy and does nothing except having heated discussions about competition. When the Russian international vessels register is approved at last, the time will come to transport domestic cargo under Russian flag. And it is transport services market as well.
International truck haulage developed quite dynamically last year. Their volumes grew up by 17,6%. At the same time the share of the Russian hauliers reached 38% though it was as little as one third not long ago. The country's prospect policy regarding this issue envisages a set of effective steps to elaborate Russia's position strengthening on the world truck haulage market and stimulation of the Russian companies competition. In particular, some legal acts are going to be approved that would set up a practice of foreign hauliers being tolled for the Russian road infrastructure utilizing. It should be said such practice has already become everyday reality for many countries in the world.
Today's Russia has become a platform for high-speed trains development that first of all has much to do with the line Moscow - Saint-Petersburg. Here we are speaking of two projects, they are high-speed rolling stock production and a new high-speed line construction. Now ОАО RZD together with Siemens AG are working out the project of a speeded train. The agreement has already been made and certain parameters are elaborated. The immediate contract is expected to be signed in summer. These trains production is planned to be launched in Moscow and first train is to appear in 2007. Moreover OAO RZD intends to hold present-day Moscow-Saint-Petersburg line reconstruction with the help of the company's funds in order to make this line adjusted to a speed of 250 km per hour. Another project is directed at a new line construction which is planned to be built to the west of already existing one. This line shows a qualitatively new approach to transportation at speed of 300 km per hour and even more, the basic methods of construction being totally different. Unfortunately, there are no lines of this sort in Russia yet. Today this project is being worked out in details that cover in particular financing schemes considering foreign investors participation. It would be worthwhile to realize the idea of special economic zones establishment where all the conditions for new technologies development will be given.
As a top-priority of the transport policy of the Russian Federation one can quote the formation of an up-to-date and elaborated infrastructure capable to allow for cargo and passenger transportation speeding up, transport expenditures in the economy decrease, industrial and mineral resources base advance as well as Russia's integration and its positions strengthening in the world market.
Andrey Guryev
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For the past period the controlling body was drastically re-formed, staffing procedures were carried on, new way for the Transport Ministry's interaction with subordinated newly-made Transport Agencies and Transport Service was worked out. Generally, the set target was reached though some problems to be made decision about are still remain. In 2005 the Ministry has to complete work on the documents that regulate its functioning as well as that of its subordinated departments.
Apart from the administrative reform the state transport policy has also undergone serious changes. As a result a set of programme documents predetermined to define the strategy of transport system development for long- and medium-term perspective were worked out. First of all, the Ministry of Transport Colleague approved the transport strategy of Russia up to 2020 and the RF transport development strategy up to 2010. The most important tool to accomplish the above-mentioned tasks has always been the Federal target programme "Russian Transport system modernization (2002 - 2010)". In 2004 it was amended in accordance with the modern calls and new tendencies of the state's economy development.
Also last year we witnessed a transfer to new budget planning mechanisms destined for programme-target indexes and a certain subject to estimation.
Much To Be Done
Today the state of technical base of the sector is quite troublesome, its wear and tear degree amounts to 60%. One of the major reasons that has caused it is poor transport financing. In 2002 - 2005 the sector received 17% less of the funds allocated by the programme "Transport system modernization" which is worth USD 2,5 bln. The situation in the road sector is especially complicated. In five years expenditures share for the road economy in the GDP structure of Russia got down from 2,9% in 2000 to 1,3% in 2004. As a result volume of new roads of general use being put into operation dropped from 7 thousand kilometers in 2000 to 1752 kilometers in 2004, road maintenance volume decreased by half. At the same time according to the World Bank system with the GDP growth by 7% per year macroeconomics needs of Russia for road net development are estimated at 17 thousand of new routes a year. Moreover, efficient control and way of budget funds expenditure have not been developed yet; mechanisms of competition trades and purchases are not transparent enough; budget funds often happen to be wasted on the objects of minor importance. And it is obvious our major problem is still low investment attractiveness of sector.
The way to change it leads to the road sector complex structural reform and active attraction of non-budget funds on the basis of public-private partnership. Thus, last year the development of some pilot-projects on toll road construction started with the help of financial and human resources of private stock. In February the contest on the projects of investment foundation for the high-speed motor track Moscow-Saint-Petersburg was held. In the near future the same contest is going to be held for the Central ring road project in the Moscow region. In parallel with that hard work on improvement of the legislative base for private business involved in such infrastructure projects is being carried on. First of all it is land and estate relations within transport sector that are closely connected with investment attractiveness of the sector and its stable functioning. This issue, in particular, was considered at the first session of the Governmental commission on the RF transport system complex development. A new bill "On concession agreements" that has already undergone the first reading in the State Duma is believed to be approved soon. As it is known concessions mechanism has been widely used in the world practice when in Russia it was actively employed in the second quarter of the 19th century in the initial construction of railways.
As mentioned before, the structural reform of road economy control is also discussed. By now the programme of first and foremost steps has already been prepared as well as a schedule for working out the Russian road sector reorganization concept. The RF Ministry of Transport is going to submit it to the Government in November. One of the major reform directions is going to become shortening exceeding enterprises in the state control sector. To accomplish this, 62 road economy enterprises and 49 motor transport enterprises were included into the privatization plan. Also the newest technologies role in transport complex shouldn't be underestimated as they can increase transport complex control efficiency, information and geoinformation technologies in first place. Now the works to establish the unified geoinformation system of complex planning and transport infrastructure monitoring development are carried on. This year promises favourable continuation of work on the unified infocommunication transport complex establishment which is based on the main line digital net of ОАО RZD. This system will perform as a necessary base and inalienable condition for the national net of transport-logistics centers formation. The unified system of cargo movement control and cargo owners transport expenditures optimization is planned to be set.
Natural Monopoly Reformed
Last September the reform's course of development was considered at the RF Government session. In particular, it was underlined that after demolition of the Ministry of Railways all the responsibility was laid upon the Ministry of Transport and now the Minister is in charge of the Governmental Programme of railway transport structural reform. In general today all the reorganization is going on according to the approved plans and all the processes happening are of positive character. At the first stage of the reform the state regulation and economy functions were divided. Within this stage OAO RZD was formed that holds practically the whole railway infrastructure, all the locomotive resources and over two thirds of car park, the company's functioning can be called stable and secure at the moment. Together with this there are more than 80 private operator companies and 50 of them own or rent about thousand rail cars each. In total Russia now operates about 250 thousand of private rail cars. Private investment into rolling stock purchase and renovation has reached about USD 2 bln. inthe last three years that can be regarded as the most important achievement of the reform. One more aspect of great importance is railway competition mechanisms starting up for OAO RZD and operators companies. Especially it concerns such sectors as oil and products, containers, perishable goods, mineral fertilizers and metals transportation.
Thus, positive results are obvious but on the whole the state should do its best not to let any failures happen in railway transport sector functioning, as the reform in this sector is strategically important for Russia.
However, the administrative reform has slightly suppressed railway reform. That can be seen in the periods of some arranged events accomplishment, in particular, it concerns urgent necessity of certain legislative-and-normative bill approval. Now the issue of greatest importance is still unsolved which is non-discriminative access to the infrastructure. The work on this is being done. Now Russia is at the second stage of the reform that envisages establishment of private carriers (having nearly a half of rolling stock) sovereign institution and consequent formation of competition in transportation and rail cars maintenance work sector. In parallel with that OAO RZD reorganization will be implemented by separation its affiliates off the company's structure according to their activities directions with their further sale. In 2005 about 20 affiliates will be separated. In particular, such sorts of business as track machinery production and maintenance, automated systems and telemechanics, specialized transportation in isothermal rolling stock, containerized transportation, scientific-technical complex, capital construction will be set apart. The next step is establishment of surburban passenger transportation companies, firms that deal with freight and passenger rail cars repairs and companies producing spare parts for cars. In 2007 the Federal passenger company is planned to be created whose whole stock of shares will be controlled by the RF Government. It is worth noting that hard work within legislative area is top-priority at a present moment. New bills must be approved by both the Government and the Ministry. The work is being accomplished in accordance with the plan sanctioned by the Government. It is guided by the Intersectoral Commission headed by the Transport Minister. In July the way of the reform unfolding is to be discussed at the RF session.
On Way To Global Market
The major result achieved by the country within international cooperation in 2004 is the fact that despite certain problems connected with the federal bodies reorganization it managed to keep dynamics and succession of contacts with foreign partners. At the same time the Ministry of Transport of the RF does its best to activate functioning in the international transport organizations while top-priority was given to the EU. Now the EU takes more than a half of Russia's foreign trade turnover that needs to be provided with proper transport services. In 2004 a good foundation was laid to implement some joint projects with Germany, Spain, Italy and Poland. The Ministry kept on working with the aim to stir up "transport dialogue" between Russia and the EU, including "25 + 1" model. Russia's part in transport cooperation with the Asian-Pacific region becomes more and more remarkable. Our country initiated the working group of the APEU transport session in Moscow in the second half of 2005. This initiative would allow to promote the RF in the Euro-Asian transport relations advantageously. Since July, 2004 Russia has headed the European Conference of the Ministers of Transport . During this period the international conference "Policy within stable development of city transport accomplishment" was organized and held as well as the international seminar "Regulatory Reform of Railways in Russia". However, the major event of the year will be the 89th session of ECMT held on May 24 - 25, in Moscow that puts an and to Russia's heading the Conference. Also on September 11-15 one more quite noticeable event will be held, i.e. the FIATA world congress. Without any doubt, this will become an outstanding event for Russian forwarding companies international relations promotion. It is worth mentioning Russia managed to get approval for the Convention on international customs transit procedure, while applying the bill of loading used in the CIS to cargo railway transportation. This was done within the framework of the Committee on domestic transport of the European Economic Commission UN. Due to Russia's initiative the problem of visa procedures simplification for the truck drivers working on the international routes was declared on the Committee's agenda. Today the Ministry has been functioning in the highly authorized EU group on formation of the development strategy of transport communications and relations between the EU and neighbouring countries for the next 15 years.
The problem of the borders check-points procedures sometimes considered the major obstacle for international transport cooperation influence Russia mostly in the process of truck hauliage: 17% of check-point service 75% of foreign trade turnover when via 30% of border check-points only five trucks can pass per day. In order to establish effective control system coordinating cargo movement via border the Ministry of Transport has developed a project on creating specialized federal department that would be authorized to operate all the check-points of Russia. The Transport Ministry commenced the work on complex certification of all the check-points to make the whole system balanced. According to this work results, proposals are to be submitted to the RF Government on opening or closing postd due to their efficiency rate.
Plans and prospects
Looking over the Russian export structure we can find such key elements as oil, metal, coal, mineral fertilizers etc. but you can never find transport services there. It is quite obvious the country can earn a lot on transit, offering foreign goods consignors to make use of our transport system. The RF Ministry of Transport submitted "Transit" federal target programme for approval. The body should simply analyze the market state and opportunities in this area without going into much detail of "general" investment into the railways, motor tracks and ports and define which international transport corridor is capable to get larger transportation volume. Having the "North - South" and the "West-East" (Transsib) international corridors, two pan-European corridors crossing the country's territory steps on making decision on boosting transit cargo flows must to be taken. Let us say, we need to set up certain number of check-points, make all the customs procedures transparent etc. Having done all this Russia gets a clear perspective on which routes foreign companies can be attracted. Or for example passenger transit: millions of people bypass Russia making stops at the country's neighbours. What does it show? Just that the country doesn't see potential profit and doesn't want to make money. Russian carriers face a constant problem of having no access to the foreign railways. It clearly shows what must be done in the first place. Moreover, Russia's export/import cargo freight costs USD 6 bln. per year. Russian carriers participate in it by 8-10%. But it is a transport services market! Other countries simply force their manufactures to apply for carriers' services under this condition, which provides them with a set of subsidies and privileges. But the country feels shy and does nothing except having heated discussions about competition. When the Russian international vessels register is approved at last, the time will come to transport domestic cargo under Russian flag. And it is transport services market as well.
International truck haulage developed quite dynamically last year. Their volumes grew up by 17,6%. At the same time the share of the Russian hauliers reached 38% though it was as little as one third not long ago. The country's prospect policy regarding this issue envisages a set of effective steps to elaborate Russia's position strengthening on the world truck haulage market and stimulation of the Russian companies competition. In particular, some legal acts are going to be approved that would set up a practice of foreign hauliers being tolled for the Russian road infrastructure utilizing. It should be said such practice has already become everyday reality for many countries in the world.
Today's Russia has become a platform for high-speed trains development that first of all has much to do with the line Moscow - Saint-Petersburg. Here we are speaking of two projects, they are high-speed rolling stock production and a new high-speed line construction. Now ОАО RZD together with Siemens AG are working out the project of a speeded train. The agreement has already been made and certain parameters are elaborated. The immediate contract is expected to be signed in summer. These trains production is planned to be launched in Moscow and first train is to appear in 2007. Moreover OAO RZD intends to hold present-day Moscow-Saint-Petersburg line reconstruction with the help of the company's funds in order to make this line adjusted to a speed of 250 km per hour. Another project is directed at a new line construction which is planned to be built to the west of already existing one. This line shows a qualitatively new approach to transportation at speed of 300 km per hour and even more, the basic methods of construction being totally different. Unfortunately, there are no lines of this sort in Russia yet. Today this project is being worked out in details that cover in particular financing schemes considering foreign investors participation. It would be worthwhile to realize the idea of special economic zones establishment where all the conditions for new technologies development will be given.
As a top-priority of the transport policy of the Russian Federation one can quote the formation of an up-to-date and elaborated infrastructure capable to allow for cargo and passenger transportation speeding up, transport expenditures in the economy decrease, industrial and mineral resources base advance as well as Russia's integration and its positions strengthening in the world market.
Andrey Guryev
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For the past period the controlling body was drastically re-formed, staffing procedures were carried on, new way for the Transport Ministry's interaction with subordinated newly-made Transport Agencies and Transport Service was worked out. Generally, the set target was reached though some problems to be made decision about are still remain. In 2005 the Ministry has to complete work on the documents that regulate its functioning as well as that of its subordinated departments.
Apart from the administrative reform the state transport policy has also undergone serious changes. As a result a set of programme documents predetermined to define the strategy of transport system development for long- and medium-term perspective were worked out. First of all, the Ministry of Transport Colleague approved the transport strategy of Russia up to 2020 and the RF transport development strategy up to 2010. The most important tool to accomplish the above-mentioned tasks has always been the Federal target programme "Russian Transport system modernization (2002 - 2010)". In 2004 it was amended in accordance with the modern calls and new tendencies of the state's economy development.
Also last year we witnessed a transfer to new budget planning mechanisms destined for programme-target indexes and a certain subject to estimation.
Much To Be Done
Today the state of technical base of the sector is quite troublesome, its wear and tear degree amounts to 60%. One of the major reasons that has caused it is poor transport financing. In 2002 - 2005 the sector received 17% less of the funds allocated by the programme "Transport system modernization" which is worth USD 2,5 bln. The situation in the road sector is especially complicated. In five years expenditures share for the road economy in the GDP structure of Russia got down from 2,9% in 2000 to 1,3% in 2004. As a result volume of new roads of general use being put into operation dropped from 7 thousand kilometers in 2000 to 1752 kilometers in 2004, road maintenance volume decreased by half. At the same time according to the World Bank system with the GDP growth by 7% per year macroeconomics needs of Russia for road net development are estimated at 17 thousand of new routes a year. Moreover, efficient control and way of budget funds expenditure have not been developed yet; mechanisms of competition trades and purchases are not transparent enough; budget funds often happen to be wasted on the objects of minor importance. And it is obvious our major problem is still low investment attractiveness of sector.
The way to change it leads to the road sector complex structural reform and active attraction of non-budget funds on the basis of public-private partnership. Thus, last year the development of some pilot-projects on toll road construction started with the help of financial and human resources of private stock. In February the contest on the projects of investment foundation for the high-speed motor track Moscow-Saint-Petersburg was held. In the near future the same contest is going to be held for the Central ring road project in the Moscow region. In parallel with that hard work on improvement of the legislative base for private business involved in such infrastructure projects is being carried on. First of all it is land and estate relations within transport sector that are closely connected with investment attractiveness of the sector and its stable functioning. This issue, in particular, was considered at the first session of the Governmental commission on the RF transport system complex development. A new bill "On concession agreements" that has already undergone the first reading in the State Duma is believed to be approved soon. As it is known concessions mechanism has been widely used in the world practice when in Russia it was actively employed in the second quarter of the 19th century in the initial construction of railways.
As mentioned before, the structural reform of road economy control is also discussed. By now the programme of first and foremost steps has already been prepared as well as a schedule for working out the Russian road sector reorganization concept. The RF Ministry of Transport is going to submit it to the Government in November. One of the major reform directions is going to become shortening exceeding enterprises in the state control sector. To accomplish this, 62 road economy enterprises and 49 motor transport enterprises were included into the privatization plan. Also the newest technologies role in transport complex shouldn't be underestimated as they can increase transport complex control efficiency, information and geoinformation technologies in first place. Now the works to establish the unified geoinformation system of complex planning and transport infrastructure monitoring development are carried on. This year promises favourable continuation of work on the unified infocommunication transport complex establishment which is based on the main line digital net of ОАО RZD. This system will perform as a necessary base and inalienable condition for the national net of transport-logistics centers formation. The unified system of cargo movement control and cargo owners transport expenditures optimization is planned to be set.
Natural Monopoly Reformed
Last September the reform's course of development was considered at the RF Government session. In particular, it was underlined that after demolition of the Ministry of Railways all the responsibility was laid upon the Ministry of Transport and now the Minister is in charge of the Governmental Programme of railway transport structural reform. In general today all the reorganization is going on according to the approved plans and all the processes happening are of positive character. At the first stage of the reform the state regulation and economy functions were divided. Within this stage OAO RZD was formed that holds practically the whole railway infrastructure, all the locomotive resources and over two thirds of car park, the company's functioning can be called stable and secure at the moment. Together with this there are more than 80 private operator companies and 50 of them own or rent about thousand rail cars each. In total Russia now operates about 250 thousand of private rail cars. Private investment into rolling stock purchase and renovation has reached about USD 2 bln. inthe last three years that can be regarded as the most important achievement of the reform. One more aspect of great importance is railway competition mechanisms starting up for OAO RZD and operators companies. Especially it concerns such sectors as oil and products, containers, perishable goods, mineral fertilizers and metals transportation.
Thus, positive results are obvious but on the whole the state should do its best not to let any failures happen in railway transport sector functioning, as the reform in this sector is strategically important for Russia.
However, the administrative reform has slightly suppressed railway reform. That can be seen in the periods of some arranged events accomplishment, in particular, it concerns urgent necessity of certain legislative-and-normative bill approval. Now the issue of greatest importance is still unsolved which is non-discriminative access to the infrastructure. The work on this is being done. Now Russia is at the second stage of the reform that envisages establishment of private carriers (having nearly a half of rolling stock) sovereign institution and consequent formation of competition in transportation and rail cars maintenance work sector. In parallel with that OAO RZD reorganization will be implemented by separation its affiliates off the company's structure according to their activities directions with their further sale. In 2005 about 20 affiliates will be separated. In particular, such sorts of business as track machinery production and maintenance, automated systems and telemechanics, specialized transportation in isothermal rolling stock, containerized transportation, scientific-technical complex, capital construction will be set apart. The next step is establishment of surburban passenger transportation companies, firms that deal with freight and passenger rail cars repairs and companies producing spare parts for cars. In 2007 the Federal passenger company is planned to be created whose whole stock of shares will be controlled by the RF Government. It is worth noting that hard work within legislative area is top-priority at a present moment. New bills must be approved by both the Government and the Ministry. The work is being accomplished in accordance with the plan sanctioned by the Government. It is guided by the Intersectoral Commission headed by the Transport Minister. In July the way of the reform unfolding is to be discussed at the RF session.
On Way To Global Market
The major result achieved by the country within international cooperation in 2004 is the fact that despite certain problems connected with the federal bodies reorganization it managed to keep dynamics and succession of contacts with foreign partners. At the same time the Ministry of Transport of the RF does its best to activate functioning in the international transport organizations while top-priority was given to the EU. Now the EU takes more than a half of Russia's foreign trade turnover that needs to be provided with proper transport services. In 2004 a good foundation was laid to implement some joint projects with Germany, Spain, Italy and Poland. The Ministry kept on working with the aim to stir up "transport dialogue" between Russia and the EU, including "25 + 1" model. Russia's part in transport cooperation with the Asian-Pacific region becomes more and more remarkable. Our country initiated the working group of the APEU transport session in Moscow in the second half of 2005. This initiative would allow to promote the RF in the Euro-Asian transport relations advantageously. Since July, 2004 Russia has headed the European Conference of the Ministers of Transport . During this period the international conference "Policy within stable development of city transport accomplishment" was organized and held as well as the international seminar "Regulatory Reform of Railways in Russia". However, the major event of the year will be the 89th session of ECMT held on May 24 - 25, in Moscow that puts an and to Russia's heading the Conference. Also on September 11-15 one more quite noticeable event will be held, i.e. the FIATA world congress. Without any doubt, this will become an outstanding event for Russian forwarding companies international relations promotion. It is worth mentioning Russia managed to get approval for the Convention on international customs transit procedure, while applying the bill of loading used in the CIS to cargo railway transportation. This was done within the framework of the Committee on domestic transport of the European Economic Commission UN. Due to Russia's initiative the problem of visa procedures simplification for the truck drivers working on the international routes was declared on the Committee's agenda. Today the Ministry has been functioning in the highly authorized EU group on formation of the development strategy of transport communications and relations between the EU and neighbouring countries for the next 15 years.
The problem of the borders check-points procedures sometimes considered the major obstacle for international transport cooperation influence Russia mostly in the process of truck hauliage: 17% of check-point service 75% of foreign trade turnover when via 30% of border check-points only five trucks can pass per day. In order to establish effective control system coordinating cargo movement via border the Ministry of Transport has developed a project on creating specialized federal department that would be authorized to operate all the check-points of Russia. The Transport Ministry commenced the work on complex certification of all the check-points to make the whole system balanced. According to this work results, proposals are to be submitted to the RF Government on opening or closing postd due to their efficiency rate.
Plans and prospects
Looking over the Russian export structure we can find such key elements as oil, metal, coal, mineral fertilizers etc. but you can never find transport services there. It is quite obvious the country can earn a lot on transit, offering foreign goods consignors to make use of our transport system. The RF Ministry of Transport submitted "Transit" federal target programme for approval. The body should simply analyze the market state and opportunities in this area without going into much detail of "general" investment into the railways, motor tracks and ports and define which international transport corridor is capable to get larger transportation volume. Having the "North - South" and the "West-East" (Transsib) international corridors, two pan-European corridors crossing the country's territory steps on making decision on boosting transit cargo flows must to be taken. Let us say, we need to set up certain number of check-points, make all the customs procedures transparent etc. Having done all this Russia gets a clear perspective on which routes foreign companies can be attracted. Or for example passenger transit: millions of people bypass Russia making stops at the country's neighbours. What does it show? Just that the country doesn't see potential profit and doesn't want to make money. Russian carriers face a constant problem of having no access to the foreign railways. It clearly shows what must be done in the first place. Moreover, Russia's export/import cargo freight costs USD 6 bln. per year. Russian carriers participate in it by 8-10%. But it is a transport services market! Other countries simply force their manufactures to apply for carriers' services under this condition, which provides them with a set of subsidies and privileges. But the country feels shy and does nothing except having heated discussions about competition. When the Russian international vessels register is approved at last, the time will come to transport domestic cargo under Russian flag. And it is transport services market as well.
International truck haulage developed quite dynamically last year. Their volumes grew up by 17,6%. At the same time the share of the Russian hauliers reached 38% though it was as little as one third not long ago. The country's prospect policy regarding this issue envisages a set of effective steps to elaborate Russia's position strengthening on the world truck haulage market and stimulation of the Russian companies competition. In particular, some legal acts are going to be approved that would set up a practice of foreign hauliers being tolled for the Russian road infrastructure utilizing. It should be said such practice has already become everyday reality for many countries in the world.
Today's Russia has become a platform for high-speed trains development that first of all has much to do with the line Moscow - Saint-Petersburg. Here we are speaking of two projects, they are high-speed rolling stock production and a new high-speed line construction. Now ОАО RZD together with Siemens AG are working out the project of a speeded train. The agreement has already been made and certain parameters are elaborated. The immediate contract is expected to be signed in summer. These trains production is planned to be launched in Moscow and first train is to appear in 2007. Moreover OAO RZD intends to hold present-day Moscow-Saint-Petersburg line reconstruction with the help of the company's funds in order to make this line adjusted to a speed of 250 km per hour. Another project is directed at a new line construction which is planned to be built to the west of already existing one. This line shows a qualitatively new approach to transportation at speed of 300 km per hour and even more, the basic methods of construction being totally different. Unfortunately, there are no lines of this sort in Russia yet. Today this project is being worked out in details that cover in particular financing schemes considering foreign investors participation. It would be worthwhile to realize the idea of special economic zones establishment where all the conditions for new technologies development will be given.
As a top-priority of the transport policy of the Russian Federation one can quote the formation of an up-to-date and elaborated infrastructure capable to allow for cargo and passenger transportation speeding up, transport expenditures in the economy decrease, industrial and mineral resources base advance as well as Russia's integration and its positions strengthening in the world market.
Andrey Guryev
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