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The first step to an institutional breakthrough in international transport cooperation

The Seventh International Rail Business Forum 1520 Strategic Partnership has concluded in Sochi. As per tradition, the key forum partners were Russian Railways, Siemens AG and Deutsche Bahn AG. The forum organiser was Business Dialogue. The key theme of the event was The 1520: A Formula of Growth in a Networked System of Economic and Trade Organisations.

More than 1,400 delegates gathered in the capital city of the 2014 Winter Olympics in order to answer the question: what will be the role of the 1520 Area over the coming years in the processes of globalisation and integration? According to Russian Railways President Vladimir Yakunin, the forum was attended by an unprecedented number of government representatives: delegations from the Russian Ministry of Transportation, Ministry of Economic Development and the Federal Tariff Service as well as from the ministries and agencies of other forum member nations. A delegation from the European Union also took part in the forum, which demonstrates the interest of the European political and economic elite in the outcomes of the issues discussed at the forum.

Representatives of the industrial and extractive industries, bankers and transport experts joined up with the managers of railway administrations and other members of the transport market in order to express their opinion on the challenges currently facing the transport system of Europe and Asia as well as on the 1520 Space as a connecting link between the EU and the Asia-Pacific region.

During the discussion EU-1520-APEC: Trans-Eurasian Corridor of the Global Economy, each speaker, while agreeing in principle with this aspect of integration and globalisation, put forward his own ideas on how to implement these plans:

Vladimir Yakunin said the main objective is to build a coherent system of relations with partners from the CIS, Asia-Pacific region and Europe on key issues involving the development of railway transport.

European Commission Vice-President and European Commissar for Transport Siim Kallas believes that the Eurasian transport corridor not only exists but is already quite competitive. It is only a matter of accelerating border clearance, he said.

Russian Deputy Minister of Transport Nikolay Asaul spoke about the legal side of establishing effective railway corridors. German Minister of Transport, Building and Urban Development Peter Ramsauer stressed in his speech that the railways are making a significant contribution to the growth in the economies of Europe, Asia and Russia. Bilateral cooperation is extremely important, although much more can be done on a trilateral basis.

Brian Simpson, chairman of the European Parliament Committee on Transport and Tourism, argues that in order to unite interests “the whole puzzle must be assembled”: from investment in infrastructure to overcoming technical and administrative barriers. Kirill Androsov, chairman of the Russian Railways Board of Directors and a managing partner at Altera Capital Investment Company, said solutions to infrastructure problems should be the top priority. This position was supported by Alexey Tsydenov, director of the Russian Federal Railway Transport Agency, and Ugis Magonis, president and chairman of Latvian Railways.

Rüdiger Grube, chairman of Deutsche Bahn AG, appealed to the politicians of all countries concerned: regulation of the railway business is essential, he said, but overregulation is not needed since this could destroy the business.

William White, chairman of the Economic and Development Review Committee at the Organisation for Economic Co-operation and Development (OECD), once again stressed that railway transport should have no competition on the Eurasian space due to its environmental friendliness and ability to bypass the other bottlenecks that are currently being seen on other types of transport.

Askar Mamin, President of Kazakhstan Railways National Company, stated that Europe-Asia transport is currently one of the most pressing issues and Kazakhstan has long been addressing this issue with success, as evidenced by its fruitful cooperation with Russia and China.

The subject of subsidising railway infrastructure, establishing a system of mutual guarantees and commitments and creating a favourable tariff environment, which was raised at the plenary session by Kirill Androsov, was elaborated on during the expert dialogue Infrastructure Map 1520: Investment Incentive for Development. This issue generated particular interest with independent forum director Nikita Krichevsky, the chairman of the Russian Organisation for Small and Medium Entrepreneurship (OPORA RUSSIA). In his concluding remarks, he emphasised that infrastructure belongs to the government and all levers for subsidising it should also belong to the government.

The strategic dialogue 1520 and 1435: Bridging Eurasia was just as constructive as the previous discussion. Latvian Minister of Transport Aivis Ronis pointed out that Latvia is in a unique position: on the one hand, it is located within the EU legal framework, while, on the other hand, it is located in the 1520 space of regulation as far as railways are concerned. Jean-Pierre Loubinoux, director general of the International Union of Railways, said the ability of railway industry officials to unite the world would depend on several factors. Above all it will require political will followed by the cautious use of financial resources, improved infrastructure and, finally, cooperation instead of competition among all members of transcontinental projects.

The themes discussed at the plenary session and strategic dialogue were continued the next day during the session CES: Towards an Integrated Rail Transport Market. This session focused on a coordinated tariff policy to promote trans-border transport, the introduction of advanced electronic declaration forms and the unification of regulations for transit and monitoring of the transit of international freight.

One of the highlights of the forum was the presentation of a highly ambitious project to develop railway infrastructure – the project to build broad gauges to Vienna, as described by ÖBB-Holding AG General Director Christian Kern. The project involves the construction of the new Kosice–Bratislava–Vienna railway line with length of 390-430 kilometres (depending on the route selected). Investment in the project is estimated at 6 billion euro, not including the construction of terminals and associated logistics infrastructure as well as the modernisation of the railway stations of the member nations. The forum participants noted that this project would result in the creation of a single stable transport corridor with length of 10,000 kilometres, which would make it possible to transport freight between Europe and Asia as efficiently as possible and also lead to an increase in global business activity.

A single model for a common railway transport market was the subject of discussion at the sectoral sessions 1520 in 2020: A Single Model for the Common Rail Transport Market, Business Model for Freight Transportation: Improving Efficiency amid Growing Competition, and Piggyback 1520.

The localisation of innovative technologies in the 1520 Area was discussed during sessions devoted to railway construction and engineering and was also addressed as a separate theme at a specialised session. RBC TV General Director and independent forum director Alexander Lyubimov made special mention of the discussion devoted to railway engineering in his concluding remarks. The forum members did not forget about the problems facing passengers either and discussed ways to manage passenger transport, boosting its profitability as well as services at railway stations as far as improving their quality during the two sectoral sessions.

The discussion Generation 2020: New Standards led the participants to the conclusion that “Generation Y” (the generation born after 1980) will make up 50% of the personnel at Russian Railways by 2020. It will be a unique situation with representatives of five generations working at a single company. Andrey Nechaev, an independent forum director and president of the Russian Finance Corporation, made special mention of this fact in his concluding remarks at the closing of the forum and expressed wishes to the attendees that the golden age of railways would begin.

During the closing ceremony, Vladimir Yakunin stressed that the forum was the first step on the path to an institutional breakthrough in relations between the railway community, its shipping and manufacturer partners as well as its foreign partners, including representatives of the EU authorities. He also noted that the numerous agreements worth more than 120 billion roubles that were signed at the forum may be viewed as the public recognition of the importance of infrastructure development projects.

Independent forum director Sergey Karaganov, the chairman of the Foreign and Defence Policy Council, said that he was impressed with the level of organisation and format of the forum. He said it was even better than the World Economic Forum in Davos.

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