There was a relief in the logistics sector after the container crisis, but it seems that there will be a serious break in the supply chain with the occupation of Ukraine by Russia. In the midst of this rupture, Turkey is in a strategically very valuable place. UTIKAD Chairman of the Board Ayşem Ulusoy evaluated the reflections of the current situation on the Turkish logistics industry.
Considering the extraordinary situations created by the war conditions, such as the embargo imposed on Russia and the withdrawal of foreign brands from Russia, we see that the demand for Turkish products in Russia has increased. It is stated that the sales of some brands with stores in Russia have doubled in the last week. This situation confirms the fact that Turkey has increased its exports to Russia with figures. We see that the break in the supply chain in terms of the Turkish manufacturer and the logistics sector has positive returns to Turkey.
Europe can technically sell the goods it produces or currently sells, but it has no way to go. However, the route through Ukraine used by the European Union countries is no longer an alternative due to the war. The cargo leaving the European Union will reach Central Asia and from there to Russia. For this reason, Turkey comes to the fore and can take a very serious task. However, after the EU's ban on Russian planes, Turkey has not yet made any new regulations on this issue.
The blockage in the Georgia-Russia line not only disrupts the transport to Russia, but also the transit transports to Central Asia through this country. Central Asia is one of Turkey's most important export markets. Approximately 40 thousand export trips are made annually to Uzbekistan, Kyrgyzstan, Tajikistan and Kazakhstan. Before the pandemic, Turkish transporters were making 90 percent of their Central Asian flights to Turkmenistan via Iran and then to other countries. However, due to the epidemic, Turkmenistan closed the transit passage to the whole world. Logisticians want the authorities to take action to reopen this door. In case this line is reopened, it is aimed to prevent the losses due to the blockage in the Georgia-Russia line due to the war.
The logisticians, who presented the report they prepared to the ministry in order to take quick action under the current conditions, drew attention to the measures to reduce the density on the routes. One of them is to take the necessary initiatives to strengthen the infrastructure of the functioning gate, and the other is to remove the obstacles in front of alternative routes.
In terms of Turkey, the shift of global trade to the Middle Corridor is currently on the agenda. Trade and transportation between Asia and Europe are carried out through three main corridors. The "Northern Corridor" in which Russia is located, the "South Corridor" passing through Iran and the "Middle Corridor" including Turkey. However, Russia's attack on Ukraine, security problems in the northern corridor means that the goods produced or currently sold in the European Union cannot find a technical way to go. This situation made the Middle Corridor, which reaches from Turkey to the Caucasus, and from there to Central Asia and China, which crosses the Caspian Sea and includes Turkmenistan and Kazakhstan, even more valuable. Logistics centers in Turkmenistan, Kazakhstan and Azerbaijan ports in particular. and the establishment of free trade areas will contribute to the development and deepening of the Trans-Caspian cooperation.
Implementation of the developing sanctions and embargo against Russia will also increase the risk of all transportation routes from here to Europe. The importance of transport via the Middle Corridor may increase based on multilateral cooperation.
Azerbaijan and Turkey, the stakeholders of the Middle Corridor, should be ready for this. Turkey should assist and encourage other countries to resolve existing technical problems with the Middle Corridor. It seems necessary to ensure infrastructure compatibility on the basis of using the Middle Corridor at full capacity. Currently, the Baku-Tbilisi-Kars line, with a total length of 829 kilometers, is located on the borders of Azerbaijan, 504 kilometers, Georgia, 246 kilometers and Turkey, 79 kilometers. Turkey's first double gauge rail was laid in Kars Logistics Center in 2019 in order to eliminate the gap in the rail gap on the Baku-Tbilisi-Kars (BTK) railway, and to ensure that the goods coming from countries such as Azerbaijan and Kazakhstan by train reach Europe without interruption via Turkey.
While in countries such as Russia, Azerbaijan, Georgia and Kazakhstan on the BTK railway line route, a 520 millimeter wide rail line was used, there were rails of 435 millimeter standards in Turkey and Europe.
Due to the use of different lines in Asia and Europe in terms of rail spacing, trains in both continents were meeting in Ahılkelek, Georgia, which is the intersection point of the line on the BTK railway route.
A study was initiated some time ago in order to eliminate this problem, which also affects the freight transportation via Turkey, and to accelerate the freight transportation between Asia and Europe. For this purpose, a new line is being built between Kars Logistics Center and Ahılkelek, where trains from Asia arrive. With the completion of this harmonization, the costly bogie replacement process will also come to an end.
In addition, we must harmonize our customs systems and further increase the functionality of the Middle Corridor. However, while increasing the operability of the Middle Corridor, we also need to prepare our capacity and infrastructure for this increase. In order to maintain uninterrupted transportation from Asia to Europe, it seems essential to increase the number of Marmaray crossings and to provide a railway crossing over the Yavuz Sultan Selim Bridge.
Transit revenues will increase, domestic production will be encouraged, and when our customs systems and taxes are compatible with each other, our export expenses will decrease. The strategic importance of the countries on the Middle Corridor route, especially Turkey and Azerbaijan, will increase. As a result, it seems that our probability of becoming an international hub in transit transportation, which we have been targeting for many years as the logistics sector, will increase.
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