Wednesday, February 14, 2007

Armenia To Get Crucial Ferry Link With Russia

Tuesday 13, February 2007

By Shakeh Avoyan

Armenia will gain next month a long-awaited second rail ferry link with the outside world that will substantially reduce the cost of its transport communication with Russia and possibly other countries, officials said on Tuesday.

Transport and Communications Minister Andranik Manukian and a top representative of a Swiss-based company signed in Yerevan a memorandum on the launch of a regular ferry service between the Georgian Black Sea port of Poti and Russia’s Port-Kavkaz.

The company, Reserve Capital Corporation, is to operate the link with two heavy ferryboats that are reportedly undergoing technical tests at the moment. The Armenian side, for its part, will agree all legal aspects of the cargo service with the Georgian and Russian governments.

“This ferryboats will work only for Armenia,” said Manukian, adding that they will accept the first Armenian cargos in mid-March. He said Russia’s continuing transport blockade of Georgia will not affect their operations.

“This service will ensure a direct connection between the Armenian and Russian economies, which is very important,” said Arsen Ghazarian, chairman of the Armenian Union of Industrialists and Entrepreneurs, a business association that has lobbied for its creation.

Armenian companies currently import and export goods to Europe and the former Soviet Union through a similar service linking Poti with the Ukrainian port of Ilyichevsk. The Russian blockade imposed on Georgia last year stripped them of any alternative and less costly ways of making shipments to and from Russia, a key export market for many Armenian firms.

They have for years lobbied the government in Yerevan to help to open a direct Russian-Georgian ferry link that would reduce their high transportation costs. Officials said shipping a cargo consignment from Poti to Port-Kavkaz will take just over 30 hours, or almost half the time need for sending it to Russia via the Ukrainian port. They also expect a Ukrainian company operating the Poti-Ilyichevsk link, Ukrferry, to cut its transport fees.

“It’s obvious that there will be lower tariffs as a result of competition,” said Manukian. “I think Ukrferry will lower them.”

A Russian-Armenian ferry link was already launched two years ago but was cancelled shortly afterwards after reportedly incurring losses. According to Ghazarian, Reserve Capital’s ferryboats will be far more cost-effective because of their bigger capacity. He said they can carry not only up to 55 rail cars but also heavy trucks and cargo containers.

“In one year from now we will have a 50 percent increase in exports to Russia,” predicted Ghazarian. “The increase in imports will be slower.”

Note: Above are excerpts from the article. The full article appears here. Clarifications and comments by me are contained in {}. Deletions are marked by [...]. The bold emphasis is mine.

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