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Friday, July 11, 2014, 10:39

Joining the new Silk Road

By Wong Joon San

Joining the new Silk Road

Investor interest

Hong Kong’s long standing advantage as an international center for raising equity capital is that foreign issuers acquire access to wealthy Asian investors, expand shareholder bases and expose their brands to the coveted Greater China consumer market.

Local investors also have a notably keen interest to invest in companies from outside Hong Kong, while keeping their shareholdings in Hong Kong dollars and enjoying the protection of the city’s legal system.

“In the next six years, Kazakhstan will invest $45 billion to create an efficient transportation infrastructure. Our company will develop the railway transport and the national logistics company, with links to Port Aktau and the Caspian Sea,” Mamin said, adding that KTZ Express leads in the development of transport-and-logistics  (TLC) networks in Kazakhstan over the period 2014-2015. (The company has planned $500 million in investment to develop two million square meters of TLC facilities.) 

On the ground, $3 billion will be invested in rail infrastructure in Kazakhstan this year, providing a state-of-the-art national freight network, improving connectivity with the country’s regional centers and neighboring countries.

As part of its expansion plans, KTZ, in November last year, signed a deal with global marine terminal operator DP World to provide management advisory services for the development of the Khorgos Special Economic Zone (SEZ) and Inland Container Depot (ICD). DP World will also provide similar services under a separate contract at the Port of Aktau, Kazakhstan’s main cargo and bulk terminal in the Caspian Sea.

Freight center

KTZ concluded a major contract in May to build a $100- million freight and logistics center on the coast of China, at Lianyungang port, roughly halfway between Beijing and Shanghai. The 21-hectare facility will have a capacity for 500,000 TEU of containers per year.

The facility, which is linked to the New Silk Road, will provide direct access to Central Asia for shippers from Japan, Korea and Southeast Asia, moving cargo by sea to Lianyungang, and then by rail to Kazakhstan and onwards to Europe.

“We also see a growing number of commercial unit trains heading the other way, carrying goods from Riga, Duisburg, Moscow, Lodz, Balykchi-bound through Kazakhstan for China, with some ultimately to be transshipped to other ports in South East Asia, like Pusan (in South Korea),” Mamin told China Daily.

Lianyungang and the Kazakhstan national railway company have invested $98 million in the joint venture project, which includes a planned container yard of 220,000 square meters and 3.8 km of railways. The average daily discharge will be over 10 trains.

KTZ says it expects the company’s new Hong Kong office will open a new era of freight transit along the New Silk Road.

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Japanese investor to build car terminal in Astana

The Japanese NYK Group, a global leader in the field of transportation, plans to expand its investment projects in Kazakhstan.

Primarily, the group intends to build a logistics center for handling сars in Astana and explore the possibility of organizing transportation of cars through Khorgos-Eastern Gates special economic zone (SEZ).

As the group is searching for a plot of land in Astana, Kaznex Invest has organized a meeting for the company with Investors Service Centre in Astana. It has also sent a request to the Land Committee to allocate a land plot for long-term lease. The project cost is expected to be up to $5 million.

For a similar project in the SEZ Khorgos-Eastern Gates with the assistance of Kaznex Invest, the investor has held negotiations with the leaders of KTZ Express and the Transporters Union of RK Kazlogistics.

In another development, NYK Group has already invested in a car terminal in Almaty through the acquisition of 100-percent shares of Trunk Terminal LLP, which is the largest terminal and logistics operator. It provides service for terminal handling and transport of vehicles to dealers via a new company NYK AutoLogistics (Kazakhstan) LLP.

The company is a major provider of logistics services for Toyota Motors Kazakhstan, Mitsubishi Motor Kazakhstan, and Suzuki Motor RUS.

NYK’s activity in Kazakhstan is also aimed at the use of transit potential of Kazakhstan, in particular, the organization of transportation across China where the company has invested significant funds in a number of major logistic projects.


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