Anaklia seaport is one of the superb projects that will be implemented in Georgia after multi-year discussions.
Anaklia seaport is considered a component of another grand and important project of Silk Road and a main sea transportation hub to connect Europe with Asia. However, part of experts asserts that this project is a populist one and all calculations are unrealistic.
It should be noted currently Georgia has four operating seaports, including two sea terminals (Kulevi and Supsa) and two seaports (Poti and Batumi).
In the near future (in approximately 3 years) Georgia will acquire fifth seaport – Anaklia Seaport. Let’s discuss whether Georgia genuinely needs the new seaport construction. The seaport’s highest turnover is said to be 100 million tons.
What will be the benefit that the Georgian economy may receive from the Anaklia seaport project implementation?
This is a multidimensional issue and there is no accurate answer to this question at this stage, because this project counts on not only Georgia’s economic potential and needs, but it is also a part of global geopolitical interests. In the course of time, these interests may change to the benefit or to the detriment of the seaport.
Namely, we mean interest clashes between China and Russia, Russia and Turkey, Russia and Iran, Armenia and Azerbaijan, Europe and Russia and a great number of other allies or enemies. However, let’s see the current potential of Georgia, as a transit corridor, and whether this transit corridor is interesting from the regional point of view:
For the past 5 years (2011-2015) the total cargo volume transported by various transportation sectors systematically declines. Namely, the cargo turnover in 2011 marked 48.9 million tons, while this indicator declined by about 10% by 2015 (44.2 million tons).
Turnover at seaports decreased to 19.2million tons from 22.1 million tons as a result of considerable contraction in turnover at Batumi and Poti seaports.
It should be noted that no Georgian seaport has reached its full working capacity. Moreover, total workload of Poti and Batumi seaports make up 20 million tons, but in 2015 both seaports have handled only 12.5 million tons of cargo – 6.8 and 5.7 million tons respectively, while 5 years ago (in 2011) this indicator totaled 15.1 million tons, consequently, 7.9 and 7.1 million tons.
For the past 5 years the cargo turnover contraction was recorded at the SOCAR oil terminal in Kulevi. Namely, the cargo turnover has decreased to 2.5 million tons from 3.3 million tons (the full working capacity is 10 million tons). At the same time, 20% upturn was recorded compared to the 2014 indicators.
A 30% contraction was seen in rail shipments to 14.1 million tons from 20.1 million tons (maximum cargo turnover – 30 million tons), including 2.4 million tons of domestic, 1.1 exports, 2.7 imports and 7.9 million tons of transit cargo (slowdown is recorded in all the mentioned categories compared to the previous year).
In 2015, a 10% downturn was seen in container transportation too compared to 2014. (to 44.3 thousand TEU containers from 49.5 thousand).
Civil aviation sector has also recorded insignificant cargo transportation – around 15-16 thousand tons, for the past 5 years. On the other hand, certain directions have recorded an evident upturn in cargo turnover, namely:
In 2015, as compared to 2011, the quantity of processed containers in Poti and Batumi seaports increased by 27% to 380 000 containers from 300 000 ones, including 325 000 containers in Poti and 55 000 containers in Batumi seaport. It should be also noted that in 2015, as compared to 2014, container turnover declined by 15%.
Truck transportation has increased by about 6% to 30 million tons for the past 5 years;
The Supsa terminal turnover has increased by 10% to 4.2 million tons from 3.8 million tons (maximum workload 5-6 million tons).
In the near future, the Baku-Tbilisi-Karsi railway project will be put into exploitation and Georgia will acquire additional transportation capacity. This route will transport consignments from Asia to Europe through Turkish seaports. Consequently, this factor may negatively affect the operation of Georgian seaports. However, this railroad will make its contribution to the rail potential development in Georgia.
According to the plan, the Anaklia seaport construction works will be carried out in seven stages, It’s highest capacity will be 100 million tons and it will transport container, liquid, solid and dry consignments.
However, it is unclear from where due volumes of consignments will be attracted, while the existing seaports operate at a halved capacity.
At the same time, the Poti Seaport started making additional investments in implementing the Poti Megaport project that calls for doubling the existing power and deepening the seaport harbor.
Unlike Anaklia Seaport, the Poti Seaport will not be able to harbor the so-called Mother Vessels (maximum tonnage – 10 000 TEU containers) and will receive only big freighters (800-900 TEU containers).
Anaklia seaport also comprises serious challenges. Despite deepwater berths, the entrance of Mother Vessels into the Anaklia Seaport depends on Turkey, not on Georgia, as Turkey bans this category of ships to cross the Bosporus Strait because of various reasons.
Even if Turkey admits this category of ships to the Black Sea, it is expected to set high tariffs to the benefit of Turkish seaports.
On the other hand, the Anaklia Seaport may attract consignments from the new direction, namely from Iran that was freed from economic sanctions recently by the international community. The matter is of transporting consignments from China to Iranian seaport of Bandar-Abas, from there to Georgian seaports via the Iran-Armenian new highway and then to Europe (basically eastern Europe).
Despite its complicated structure, this direction genuinely comprises perspectives and interest from our southern neighbors from the standpoint of regional integration – for Armenia to enhance its role as a transit country and for Iran – to increase its influence in Armenia and Georgia.
However, this route comprises other perspectives too for connecting Iran with the Russian Federation. However, all pros and cons should be weighted how positive or negative similar perspectives may be for Georgia.
Meanwhile, the Georgia-China economic cooperation gears up development paces and the free trade opportunities will deepen bilateral potential and create new opportunities for strategic cooperation and for transporting Chinese consignments from Asia to Europe. If the corresponding infrastructure is arranged, million tons of consignments will be transported through this route.
Finally, we should also take into account that the workload of Georgian Railway and highways are very limited and they cannot satisfy the projected indicators, while there no plans for developing new road infrastructure.
Consequently, it is logical and clear that it is very difficult to draw additional 100 million tons of cargo, while the operating seaports work with only halved capacity.
However, continuous, tireless efforts may enable us to draw several tens of millions of tons of cargo to Anaklia Seaport and this is a realistic prognosis. And this will create thousands of new job places, increase economic potential and will enhance Georgia’s international interests.
Vakhtang Charaia TSU Analysis and Prognosis Center