Humppila Airport and Logistics Area development, Russian Markets

Transcription

Humppila Airport and Logistics Area development,
Russian Markets
HAMK Forssa
Author
Dr Natalia Ivanova
Assoc. Professor, PHd (techn)
Year 2014
Keywords: logistic approach, transport and logistics complex (TLCx), transport and
logistics centers (TLC), forecasts of production and logistics processes, logistics
technology, Logistics Performance Index (LPI)
1
Content
1. INTRODUCTION ................................................................................................................. 4
1.1
1.2
1.3
1.4
1.5
Short Description and Need of Topic .......................................................................... 5
EU and Finland Experience ......................................................................................... 5
World Experience ......................................................................................................... 5
Attractiveness of Topic Needs for Eco-Airport Development .................................. 6
Targets, Expected Outcomes of Document................................................................. 6
2 BRIEF RUSSIAN ECONOMY PROFILE AND DESCRIPTION ................................... 6
2.1
Russian Industry Profile .............................................................................................. 6
3 RUSSIAN FREIGHT TRANSPORT AND LOGISTICS COMPLEX DEVELOPMENT:
TRENDS, PROBLEMS AND CHALLENGES ...................................................................... 12
3.2
Main Logistics Centers in Russia .............................................................................. 12
3.3 BRIEF RUSSIAN TRANSPORT AND LOGISTICS COMPLEX ................................. 13
3.4 The Transport Complex on the Market of Services ................................................ 13
3.5 Problems of Underinvestment "Bottlenecks" .......................................................... 14
3.7 Forecasts for the Development of Transport and Logistics Complex in Terms of
Sanctions ................................................................................................................................ 14
4 THE RAILWAY AND CROSS BORDER INFRASTRUCTURE DEVELOPMENT .. 15
4.1
4.2
Development of Octyabrskaya Railway (Railway in Baltic Region) ...................... 15
The Trans-Siberian Railway Development .............................................................. 16
5 RUSSIAN MARKET OF TRANSPORT AND LOGISTICS SERVICES - PROSPECTS
OF DEVELOPMENT ............................................................................................................... 20
6 RUSSIAN AIR CARGO MARKET................................................................................... 22
7 DEVELOPMENT OF INTERNATIONAL TRANSPORT CORRIDORS FOR
FINLAND – RUSSIAN RAILWAY TRANSIT IMPLEMENTATION – CHALLENGE
FOR HEA & LOGISTICS AREA ........................................................................................... 23
8 FINNISH INVESTMENTS POLICY AND DOING BUSINESS .................................... 32
8.1 Finland's Inward Foreign Investments ..................................................................... 33
8.2 Russian investments to Finland economy ................................................................. 34
8.3 Productive and successful examples of Finnish-Russian co-operation by Russian
investment flows in to Finland ............................................................................................. 35
8.4 Prospects of Finland – Russian trade co-operation ................................................. 36
9 INFRASTRUCTURE OF HEA&LOGISTICS AREA AND TRANSPORT
CORRIDORS CONECTION ................................................................................................... 37
10 SWOT ANALYSIS OF COMPETITIVE ADVANTEGES OF HEA&LOGISTICS
AREA ......................................................................................................................................... 42
2
11 CONCLUSION .................................................................................................................... 44
List of illustrations
Figure 1 USA – Finland (Humppila) – Asia Air Bridge .................................................. 4
Figure 2 Main economical centers of Russian Federation ............................................... 7
Figure 3 Russian GDP in current prices from 2004 to 2014 (in billion U.S. dollars) ...... 8
Figure 4 Russian GDP per capita in current prices from 2004 to 2014 (in billion U.S.
dollars) .............................................................................................................................. 8
Figure 5 Russian Industrial Productions ........................................................................... 8
Figure 6 Russian Expo.................................................................................................... 10
Figure 7 Russian Imports ................................................................................................ 11
Figure 8 The largest transport hubs along Trans-Siberian railway ................................ 17
Figure 9 Dynamics of transit container traffic on Trans-Siberian Railway ................... 19
Figure 10 The volume of cargo in large containers between Russia and the countries of
the Asia-Pacific region for January - June 2013 - 2014, TEU ....................................... 19
Figure 11 The volume of cargo in large empty and loaded containers in international
traffic for January - June 2013 - 2014, TEU .................................................................. 20
Figure 12 Russia’s foreign trade with Finland ............................................................... 20
Figure 13 Dynamic of export and import freight flow of RF in 2008-2014 (excluding
Kazakhstan and Belorussia)............................................................................................ 21
Figure 14 The EU's share in the supply of food products to the Russian Federation in
2013, % ........................................................................................................................... 21
Figure 15 Trans - Siberian railway ................................................................................. 24
Figure 16 Euro Asian transport corridors ....................................................................... 24
Figure 17 Integrated multimodal network ...................................................................... 26
Figure 18 Murmansk region and October railway.......................................................... 28
Figure 19 Finnish railway ............................................................................................... 29
Figure 20 Tans Siberian railway..................................................................................... 30
Figure 21 The Northern Sea Route ................................................................................. 30
Figure 22 Dynamic of cargo volume (transit and domestic providing) on the Northern Sea
Route over last 25 years.................................................................................................. 31
Figure 23 Foreign direct investments to Finland in 2013, investment stock .................. 33
Figure 24 Russian investments in Finland...................................................................... 35
Figure 25 USA – Finland (Humppila) – Asia AirLandBridge ....................................... 38
Figure 26 International corridor West - East .................................................................. 40
Figure 27 International corridor North - South .............................................................. 41
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1. Introduction
In the age of globalization, when the world economies are bound together in the
network of global distribution, transportation infrastructure development can be one of
the most essential conditions of ensuring sustainable growth of transportation volume and
compliance with the international service level.
Long distance trade between the major centers of USA, Europe and Asia has
played a major role since the antiquity. The EU is one of the most important trading partners for USA, Russia and Asian countries still and role of a transport as a determinative factor
in a process of the world regions globalization and also the expansion of barter operations on basis
of international transport corridors construction is substantially increasing (in fact, the volume of
international freight turnover is estimated at one trillion dollars). At the same time a significant
share of freight traffic belongs to barter directions between USA, Europe and Asia (Figure 1).
Up till now maritime transport has taken over the major share of these trade volumes, accounting to a fast growth in maritime traffic at rates of over 6% per year. But the
vast increase of maritime transport causes some serious problems, the most important of
which is the maritime traffic congestion that is observed between the major maritime hubs
creating also severe environmental issues.
Figure 1 USA – Finland (Humppila) – Asia Air Bridge
Taking into account the rapid development of industrial and trade relations between Europe and Asian countries on one hand and long distance trade between the major
centres of Europe and Asia on another hand research and consideration of strategy and
economics issues for both air and land routes development are crucial and very important
4
task. One of important task is also to connect air routes with motorway and railway creating huge logistics centers and distribution Hubs on the basic of environmentally friendly
and smart technological airports.
1.1 Short Description and Need of Topic
Thinking of the cargo and the transport of goods from one place to another, the
possibilities for transportation needs to be good enough nearby the airport. Meaning that
airport needs to be located so that motorway, a bigger road or a railway needs to be close
enough to accomplish fluent and fast transport to the destination. With this possibilities
the airport which is mainly focused on cargo transport makes it more attractive in that
way the transportation in made much easier to accomplish, even then when the airport is
located further from the cities.
Attractiveness of the airport is really hard to get. Particularly, when we are talking
about on airport where the traffic is done only by cargo airplanes. So there is no passengers who need you needs to please (makes the job a bit easier), but in these cases the
effectiveness and knowledge of the employees is the most important thing. Things needs
to get done fast and in a right way, there is no place for mistakes or slow movements.
Sometimes there might land a plenty of planes (peak hour) and more goods to be handled
at the same time. When everything is working as it should, the airport will give more
positive outcomes and planes would land there. Also those companies which prefer more
ecological point of view would love to land there and make their businesses.
1.2 EU and Finland Experience
Eco Air Bridge is an ecological air bridge between America and Asia via Europe
(Finland).
This new ecological center will offer a new solution for intercontinental air freight
networks. An intermediate landing in Europe shortens the journey and saves money.
Right now there are flying more than 30 planes over Humppila every day. Humppila’s
Airport would be located so that all of these planes have an opportunity to land and make
the needed changes before continuing their trip to their destination. The new East-West
Bridge will open up uncongested and efficient transport routes not only through Europe
but to Russia through two directions:
Distances are long and as north of Europe as Humppila’s located there are no
airports where the airplanes could land without doing some kind of twist in their routing.
Overall, there still is a lot of free airspace, which means that there is a possibility
for all cargo airplanes to land and rise without waiting time. Thanks to railway and road
connections the transportation ecologically and fast is possible in Humppila1.
1.3 World Experience
1
The employment overview of Häme Centre for Economic Development, Transport and the Environment September
2013 22.10.2013. Accessed 24.11.2013
Sourse:
http://www.ely-keskus.fi/documents/10191/107992/Ty%C3%B6llisyyskatsaus+syyskuu/ac0bbb0b-b9114997-8675-26aba5921811
5
When the airport is located a bit further from the big city, cargo planes can work
more easily. They don’t need to be so careful of the time when they are landing or taking
of. In this way they are not bounded to some specific time of delivery or need to take into
account different time zones. Also, when the cargo airport is located far enough from the
bigger cities and there is not so much people living nearby working life and times will be
a lot easier. No worrying of night shifts or other noise things which might happen in those
hours when people would like to have peace and quiet around them. This makes the 24/7
taking-offs and landings possible and raises the attractiveness of long distance cargo airports. This is also proven in Asia and America, where long distance airports for cargo are
usual and more challenging, because of the population.
1.4 Attractiveness of Topic Needs for Eco-Airport Development
The world is changing, as well as companies’ policies and their attitude to ecological issues. Humppila Eco Airport is one of the examples. It has been designed to be
self-sufficient in energy consumption. To clarify this point, the diversified energy production system will use solar, wind, bio and geothermal energy. Big attention will be paid
to waste management and recycling. In the production of raw materials and renewable
fuel the storm water will be utilized. By the way there is also possible the usage of ecologically friendly vehicles on duty at the airport, such as baggage vehicles, catering
trucks, tank trucks, mobile stairs, pushback tractors, etc. What is more, some benefits can
be provided for customers, who use “green” cars, such as free parking and loyalty cards.
1.5 Targets, Expected Outcomes of Document
The main goal of this document is to engage all the interested parties, EU and
Finland Governmental structures, stakeholders, investors, and motorway, air and railway
transport community for co-operation aiming to design and promote Humppila Eco
Airport&Logistic Area (HEA). Such way could be create a notable alternative to maritime
routs corridors via HEA on the basic of air, motorway and railway transport and due to
Humppila interesting geopolitical location (center point between USA and Asia, near
Russian border). This document has to describe and show status, main tasks and trends
for increasing the efficiency of transport and logistics complex in Russia within raising
international integration and global competition for consumer of transportation and
logistics services. The Goal is to determinate and invite financing from interested
stakeholders, investors and International founds on the basic of real situation and needs.
2 Brief Russian Economy Profile and Description
2.1 Russian Industry Profile
Russia is the fifth largest economy in the world and is a leading exporter of oil
and natural gas. In Russia, services are the biggest sector of the economy and account for
58 percent of GDP. The main Russian economical centers of development are shown on
the Figer 2 2.
2
Trading Economics Sourse: http://www.tradingeconomics.com/russia/gdp-growth-annual
6
Within services the most important segments are:

wholesale and retail trade,

repair of motor vehicles,

motorcycles and personal and household goods (17 % of total GDP);

public administration,

health and education (12 %);

real estate (9 %);

transport storage and communications (7 %).
Figure 2 Main economical centers of Russian Federation
Russia is one of the world's leading producers of oil and natural gas and is also a top
exporter of metals such as steel and primary aluminum.
Russia's manufacturing sector is generally uncompetitive on world markets and is geared
toward domestic consumption.
Russia's reliance on commodity exports makes it vulnerable to boom and bust cycles that
follow the volatile swings in global prices.
The economy, which had averaged 7% growth during 1998-2008 as oil prices rose rapidly, was one of the hardest hit by the 2008-09 global economic crisis as oil prices plummeted and the foreign credits that Russian banks and firms relied on dried up. Slowly
declining oil prices over the past few years and difficulty attracting foreign direct investment have contributed to a noticeable slowdown in Gross Domestic Product (GDP)
growth rates. In late 2013, the Russian Economic Development Ministry reduced its
growth forecast through 2030 to an average of only 2.5% per year, down from its previous
forecast of 4.0 to 4.2%. In 2014, following Russia's military intervention in Ukraine, prospects for economic growth declined further, with expectations that GDP growth could
drop as low as zero.
According to the Bank of Russia estimates, the GDP in Russia expanded 0.20%
in the third quarter of 2014 over the same quarter of the previous year. GDP Annual
Growth Rate in Russia averaged 3.62% from 1996 until 2014, reaching an all time high
of 12,10% in the fourth quarter of 1999 and a record low of -11.2% in the second quarter
of 2009. GDP Annual Growth Rate in Russia is reported by the Federal State Statistics
7
Service [1]. Industrial production growth rate is 0.1% (2013 etc)3. The gross domestic
product (GDP) in Russia from 2004 to 2014 is shown on Figures 3,4. GDP refers to the
total market value of all goods and services that are produced within a country per year.
It is an important indicator of the economic strength of a country.
Figure 3 Russian GDP in current prices from 2004
to 2014 (in billion U.S. dollars)
Figure 4 Russian GDP per capita in current prices
from 2004 to 2014 (in billion U.S. dollars)
According to Acdata of the Federal State Statistics Service industrial production
in Russia averaged 2.51% from 2006 until 2014, reaching an all time high of 10.90% in
May of 2006 and a record low of -16.90% in January of 2009. Industrial Production increased 2.80% in September of 2014 over the same month in the previous year (See Figure 5).
Figure 5 Russian Industrial Productions4
Russia is one of the most industrial developed country among the former Soviet
republics. In the 2000s, Russia's industry, due to increasing demand and improved state
finances, emerged from a deep crisis caused by the dissolution of the Soviet Union.
However, years of low investment continue to leave their mark on the industry's
capabilities and a lot of its equipment is in need of modernization. According report of
3
Source: CIA World Factbook
Unless otherwise noted, information in this page is accurate as of August 23, 2014
https://www.cia.gov/library/publications/the-world-factbook/geos/rs.html
4
Trading economics portal, recourse: http://www.tradingeconomics.com
8
the Federal State Statistics Service the industrial production in Russia decreased 2.10%
in February 2013 over the same month in the previous year. From 2006 until 2013, Russia
Industrial Production averaged 2.82% reaching an all-time high of 12.60% in May 2010
and a record low of −16.90% in January 2009. In Russia, industrial production measures
the output of businesses integrated in industrial sector of the economy such as
manufacturing, mining, and utilities. Characteristics of main Russian production are
shown in Table 1.
Table 1 Characteristics of main Russian production
grain, sugar beets, sunflower seeds, vegetables, fruits;
Agriculture beef, milk
Industries
 complete range of mining and extractive industries producing coal, oil, gas,
chemicals, metals;
 all forms of machine building from rolling mills to high-performance aircraft
and space vehicles;
 defense industries (including radar, missile production, advanced electronic
components),
 shipbuilding;
 road and rail transportation equipment;
 communications equipment;
 agricultural machinery,
 tractors,
 construction equipment;
 electric power generating;
 transmitting equipment;
 medical and scientific instruments;
 consumer durables,
 textiles,
 foodstuffs,
 handicrafts
According Central Bank of Russia information from 1994 until 2014 exports in
Russia averaged 20471.03 USD Million , reaching an all time high of 50248 USD Million
in December of 2011 and a record low of 4100 USD Million in January of 1994. Exports
in Russia decreased to 38783 USD Million in September of 2014 from 40937 USD
Million in August of 2014 (Figure 6). Russian economy is highly dependent on exports
of commodities such as crude oil, petroleum products, and natural gas and accounting for
68% of total shipments. In 2013, 50% of country's federal budget revenue came from
mineral extraction taxes and customs duties on oil and natural gas. Other exports include:
nickel, palladium, iron, chemicals, cars, military equipment and timber.
9
Figure 6 Russian Expo5
Main export partners are:





Netherlands (15 %),
Italy (8.6 %),
Germany (8.1 %)
Finland 17.7%
China (7.8%)
Main Export indicators are shown in Table 2.
Table 2 Main Export indicators
Exports
Exports - commodities
$515 billion (2013 est.)
 petroleum and petroleum products,
 natural gas,
 metals,
 wood and wood products,
 chemicals,
 wide variety of civilian and military manufactures
Main Russian imports are (Figure 7): food (13% of total imports) and ground
transports (12%). Others include: pharmaceuticals, textile and footwear, plastics and
optical instruments. Main import partners are:
China (19 %),
Germany (13 %),
Finland 9.9%,
the United States (6 %),
Italy (5 %).
Main Export indicators are shown in Table 3.
5
10
Figure 7 Russian Imports6
Table 3 Main Import indicators
Imports
$335.7 billion (2012 est.)
Imports - commodities










machinery,
vehicles,
pharmaceutical products,
plastic,
semi-finished metal products,
meat,
fruits and nuts,
optical and medical instruments,
iron,
steel
The Russian economy is near stagnation, with continued lowered domestic demand leading to growth of 0.8 percent in the first half of 2014, similar to 0.9 percent in
2013. Increased geopolitical risks and the new environment of policy uncertainty and
sanctions had an additional negative impact on economic activities in the first half of
2014. There are three reasons which influence and hit the real situation of Russian economy:

Increased volatility on the exchange rate market and a significant depreciation of
the national currency;

Limited access to international financial markets for banks and non-financial
corporations,

Suppressed business and consumer confidence about future growth prospects.
A return to higher growth in Russia will depend on solid private investment growth and
a lift in consumer sentiment7.
6
7
The World Bank Portal http://www.worldbank.org
11
3 Russian Freight Transport and Logistics Complex Development: Trends,
Problems and Challenges
3.1
Introduction to Russian transport and logistics industry
Russia is largest country in the world in terms of area. Russia covers 11 time zones
that have completely different geographic, cultural and climatic features. Nowadays,
Russian Transport and Logistics market contains all the key transport modes including:

air

sea and ports

road

rail

Inland waterways.
Basic transportation indicators for Russian market:

90% of cargo transport within Russian transports on the railway (excluding pipeline
system).

The railway transport market has a total size of 25 billion Euros.
Ministry
of
Transport
refers
to
such
problems
transport and logistics industry in Russia:

significant depreciation of capital assets of transport organizations for certain activities (up to 50 - 66%);

poor quality roads. Only 38.57% of federal highways correspond to regulatory requirements for transport and operating indicators;

insufficiently apply the integrated system logistics, poorly developed technology
intermodal
transportation;

low use of information systems. There are not the internationally accepted market
standards of information technology on transport.
3.2 Main Logistics Centers in Russia
The most important logistics centers in Russia are Moscow and St. Petersburg.
But there are other economic centers as well such as Samara, Nizhny Novgorod, Kazan,
Yekaterinburg, Novosibirsk and Rostov. These centers are important in the regions as
logistics centers because of growth in retail and industry (Figure 1).
The important Russian logistics service providers:

STS Logistics,

National Logistic Company (NLK),

Russian Logistic Service, the Interterminal Group

Eurosib

Transcontainer

Etc.
The most important international logistics service providers in Russia:

DHL,

Rewiko/Fiege Group,

Militzer&Münch,
12



Hellmann Worldwide Logistics
Schenker
Etc.
3.3 Brief Russian transport and logistics complex
Russian Federation takes 90th place in the world level and development rate of
the transport-logistics sector according to the World Bank’s survey conducted in 160
countries. This comparative analysis is based on Logistics Performance Index8, which is
composed of a number of factors.
It includes follow ranks Table 49:
Table 4
Rank description
Rank
Place in terms of personnel logistics competence (this highest rating obtained by us is an
obvious example of situation when the staff professionalism defines everything)
In terms of delivery
3
For infrastructure status
3
For International Transport operations
7
In terms of the cost of domestic shipping
31
For the work of custom offices
36
7
According to expert’s evaluation the total value of the Russian market of transportation and logistics sector until 2015 can grow approximately in 3 times from 48.5
billion to 150 billion U.S. dollars10.
3.4 The Transport Complex on the Market of Services
The decrease of cargo volume and turnover reducing on all modes of transport
excepting air was observed in the past 2013 (rate of "growth" of the volume of
commercial freight traffic - 98% of commercial turnover - 98.5% compared to the
previous year). The decrease in the volume of freight on all modes of transport (without
exception) continues still in 2014. The main factors of reducing the demand for transport
services called the decline in production in key sectors of industry and freight traffic
decline in real disposable income of the population.
But signals of growth were marked as well. Thus, results of the first half of 2014 show
that, along with a reduction in the rate of transport of goods there is a slight increase in
turnover in the commercial transport sector as a whole. Based on their assessment of 2014
8
Connecting to Compete, 2014, Trade Logistics in the Global Economy
The Logistics Performance Index and Its Indicators, © 2014 The International Bank for Reconstruction and Development/The World Bank, Internet: www.worldbank.org
9 Российский рынок транспортно-логистических услуг в 2009-2010гг. и прогноз до 2013 г.// М.: Росбизнесконсалтинг 2010, c. 320. (Rossiiskiirynok transportno-logisticheskih uslug v 2009-2010 i prognoz do 2013//Moskva:
Rosbizneskonsalting 2010, s.320).
10
http://logisticas.ru/909/
13
allows to predict the fall of the commercial carriage of goods by 0.7% and the growth of
commercial turnover by 2.8%, respectively, to the level of 2012.
In view of the situation in the transport sector, the projected growth rate of industrial
production and GDP in the medium term Ministry of Economic Development predicts
the following growth performance of the transport complex in 2017 to the 2013 level:

Volume of commercial freight traffic is estimated at 3.9204 billion tons (103.9%),

Volume of freight traffic - 2.6604 trillion ton-kilometers (108.3%).
It is noted that in the case of acceleration of economic growth volume of
commercial cargo transportation will be 107.7% (4,063,900,000 tons), and turnover 112.1% (2.7522 trillion TCM).
In order to strengthen the growth performance of the transport complex in 2013
were saved state support measures adopted in 2009. The total amount of non-investment
expenditures (subsidies, contributions to the charter capital, not intended for capital
construction) from the federal budget to support the transport complex in 2013 amounted
to about 94 billion rubles11.
3.5 Problems of Underinvestment "Bottlenecks"
Projected growth of the Russian economy in the medium term stimulates
expansion of the proposed borrowed means, increasing their availability and,
consequently, an increase in investment activity sector.
The transport system of Russia in general, and a number of its key segments, have not
enough invested reserves and have not enough reserves in "long-term sustainability".
Significant "bottlenecks" in the network of railways and roads are ways down to ports,
airports and border crossing points. Most road and rail access to the largest seaports
(Novorossiysk, Saint Petersburg), do not provide the increased flow of goods; many
airports do not have a passenger rail services. Located on the inland waterways shipping
waterworks are operated already for long period (for example about half are used about
50-75 years or more). Annually Russian economy has enormous losses due to the poor
quality transport infrastructure and lack of transport opportunities of the road network.
3.6 Projected Investments to Russian Transport Complex
Investments in fixed assets in the whole transport sector at the expense of the
federal budget in 2013 amounted to 396.6 billion rubles. It is expected in 2014,
investments will be about 358.7 billion rubles. In the medium term projected investment
growth at the expense of the federal budget and till 2017 - 549 billion rubles. Total amount
of funds in 2014-2017 allocated to the development of priority infrastructure projects will
be 360 billion rubles.
3.7 Forecasts for the Development of Transport and Logistics Complex in Terms of
Sanctions
VI Baltic Transport Forum, which is traditionally held in St. Petersburg, the 11th
- 12th of September 2014, on the one hand, was devoted to topical issues of development
of the transport system in Northwest Russia and the nearest neighbors and on the other
by the problem of the order of force majeure, namely the development prospects and
11
http://www.transportrussia.ru/finansy.-investitsii.-nalogi/transportnyy-kompleks-na-rynke-uslug.html
14
freight business in the conditions prevailing in the result of the introduction of reciprocal
sanctions Russia and the European Union. And the interest in these issues among the
participants of the forum was purely practical, since it is the North-West freight flows
first to feel the impact of sanctions [1].
4 The railway and cross border infrastructure development
As noted during VI Baltic Transport Forum by 2020 it will be invested 302.1
billion rubles for railway infrastructure development in North-West region of Russian
Federation. The volume of traffic to this period is projected at 1.66 4 million.
Development of transport infrastructure includes the improvement of the cross border
infrastructure. So the construction of new sea checkpoint “Brusnichnoe” will be start in
2015. The construction of the checkpoint on the Saimaa Canal will go in the execution of
orders of the Government of the Russian Federation and protocol decisions Maritime
Collegiums of the Russian Government on arrangement of sea checkpoints belonging
Baltic Sea. For this goal the Private Public Partnerships mechanism will be used and work
will start in 2015. It will provide navigation along the Saimaa Canal. Besides, registration
of vessels and goods (which vessel carries) will be held in one particular place and meet
all modern requirements. Now the customs control and border guard service are separated
by a distance of about 20 km.
Administering of customs control at the posts of the Baltic Customs is improved
as well. As a result, in 2013-2014, the time of the containers residence in St. Petersburg
Big Port have been reduced from 6.5 to 4.1 days. During 2013 and in first half of 2014,
the container’s residence time in sea port are monitored together with stevedores.
4.1 Development of Octyabrskaya Railway (Railway in Baltic Region)
Development of Octyabrskaya railway influences on whole transport sector in
Baltic region especially the work of seaports. Rail capacity at Ust-Luga in 2015 will
amount to 64 million tons per year. In 2013, the capacity was 38.3 million tons, and by
2020 will rise to 80.3 million tons per year. In this case the port of Ust-Luga is the main
driver of growth of traffic by rail in the Northwest region.
Overall, concerning forecast of Octyabrskaya railway, in 2014 the volume of rail
traffic on the ports of the North-West will consists of 117 million tones which is 13.8%
more than in 2013.
According the forecasts for 2015-2016 years, the growth rate of the Russian
economy may reach 1.5-2.2%. For comparison, the rate of economic growth in
developing coutries could reach 5.4-5.5%, the growth rate of the world economy as a
whole - 3.4%.
Important transport infrastructure key indicators of St. Petersburg and Leningrad
region12

12
In close proximity to Saint Petersburg
Leningrad Region Investment Portal, Source: http://lenoblinvest.ru/en/investment-policy/investment-climate
15

Access to the Baltic Sea. Sea ports: Primorsk, Ust-Luga, Visotsk, Vyborg. 17%
of total cargo turnover of sea ports in Russia
Transport: Railroads – 3 thousand km – 25% of railroads in Northwestern federal
district
Roads – more than 22.5 thousand km – 15% of roads in Northwestern federal district
5 federal highways: M10 Russia, M10 Scandinavia, M11 Narva, M18 Kola and
M20 Pskov
Agglomeration of Leningrad region with Saint Petersburg – about 7 million people
Economically active population – 962 thousand people (2nd place in Northwestern
federal district)





Table 5 Important distance indicators of St. Petersburg and Leningrad region.
Air distance between HEA and Moscow
Driving distance between HEA and Moscow
Distance in km: 1235.51 km
Distance in km: 1235.51 km
4.2 The Trans-Siberian Railway Development
The Trans-Siberian Railway is a key part of the Russian railways system. It
provides transport links between Europe and Asia and it has a great potential. Express
container trains permit to deliver the goods across Russia from the Pacific Ocean to the
western borders in 11 days, with speed of more than 1,000 kms per day. According to the
Strategy-2030 the capacity of the Trans-Siberian Railway will continue for further
development13. In this connection JSC “Russian Railways” has developed and adopted
the “Program of action for the development of rail container transport using the TransSiberian Railway for the period up to 2015” in June 2009. In frame of this Program socalled project “Trans-Siberian Railway to 7 days” is implemented nowadays.
Implementation of the Trans-Siberian Railway to 7 days project will bring additional
turnover of transit container cargo to the Russian Railways increasing trade, economic
and investment cooperation between Russia and Asian countries.
In other hand it is very important to develope this railway because Sebirian region and
the Far East have huge resource potential, such as:
13
The Strategy for Developing Rail Transport in the Russian Federation based on the Act of the Government of Russian
federation on June,17 of 2008 №877r
16



mineral deposits: recoverable explored oil reserves in Siberia amount to 77 % of
Russian reserves, natural gas - 85%, coal - 80%, copper - 70%, nickel - 68%, lead
- 85%, zinc - 77%, molybdenum - 82%, gold - 41%, the platinum group metals 99%;
hydrotechnical resources - 45% of Russian hydropower potential;
biological resources - about 9 % of the world reserves of wood (over 41% of Rus-
sian reserves).
According to the Strategy-2030 a number of investment projects have to realise up
to 14 2030 for the development of railway lines and infrustructure:

the project of connection between the Trans-Korean and Trans-Siberian routes
through the station Hassan;

the project of the Baikal-Amur Mainline renovation and the development of border
areas, experts have estimated the potential of these areas at $0.5 trillion15;

the project “Ural Industrial - Ural Polar”, its attraction zone is explored less than
15%, its explored and forecasted mineral reserves amounts to more than $0.4 trillion according to the intermediate results of exploration 2006-200916;

the project " Subpolar Mainline" is a necessary for the development of the shelf and
the deepwater part of the Arctic Ocean. The U.S. Geological Survey predicts 30% of the
undiscovered world's gas reserves (90 billion barrels) and 13% of the undiscovered world
Figure 8 The largest transport hubs along Trans-Siberian railway
14http://www.railwaypro.com/wp/russia-chelyabinsk-and-murmansk-regions-will-have-the-largest-transport-hubs/
15
Siberia at first decades of the ХХI century. Chief Editor academician Russian academy of Sciences Кuleshov V.V.
Novosibirsk city. IEOPP Publishing company, 2008.
16
Economy of Russia and Siberia: past, present and future. Chief Editor academician Russian academy of Sciences
Кuleshov V.V. Novosibirsk city, 2008 г.
17
oil reserves (47 trillion. cubic meters), rich deposits of diamond, gold, platinum, tin, manganese, lead and nickel;

the project “Transcontinental Mainline” capable of mining and opening the access
via a land transport corridor to the North American market;

the project “Amur-Yakutsk Mainline” and the development of its border areas that
are very rich in natural resources;

the project “The Continent – Sakhalin” opening prospects of access to the effective
development of oil and gas fields and overland connection with Japan further;

As noted above, the territory of Siberia and the Far East, which considered rail lines
pass through, have huge resource potential. It primarily includes;

mineral deposits: recoverable explored oil reserves in Siberia amount to 77 % of
Russian reserves, natural gas - 85%, coal - 80%, copper - 70%, nickel - 68%, lead - 85%,
zinc - 77%, molybdenum - 82%, gold - 41%, the platinum group metals - 99%;

hydrotechnical resources - 45% of Russian hydropower potential;

biological resources - about 9 % of the world reserves of wood (over 41% of Russian reserves);

the project " Subpolar Mainline" is a necessary for the development of the shelf and
the deepwater part of the Arctic Ocean. The U.S. Geological Survey predicts 30% of the
undiscovered world's gas reserves (90 billion barrels) and 13% of the undiscovered world
oil reserves (47 trillion. cubic meters) (rich deposits of diamond, gold, platinum, tin, manganese, lead and nickel there);

the project “Transcontinental Mainline” capable of mining and opening the access
via a land transport corridor to the North American market;

the project “Amur-Yakutsk Mainline” and the development of its border areas that
are very rich in natural resources;

the project “The Continent – Sakhalin” opening prospects of access to the effective
development of oil and gas fields and overland connection with Japan further.
One of the main aims of Russian transport strategy is to build a core transport
network of Siberia and the Far East. The presented and outlined South-East vector in
frame of the Strategy of Developing the railways of the Russian Federation up to 2030 in
conjunction with the construction of the North-Siberian railway could become the basis
for building the “Economic development zone of Siberia” or the “Development Corridor
of Siberia” basis for cooperation with “Economic zone of “Silk Road”. The development
of transport complex including the northern territories above the Trans-Siberian Railway
with rich natural resources and creation of the network of multimodal hubs at the intersection of the major waterways (Lena, Yenisei, Angara and the Ob) will set the stage for
the development of integrated industrial and transport zones and involve rich resources
of regions. Investment cooperation in the infrastructure development of the Trans-Siberian Railway corridor and in the development of the economic potential of Siberia and
the Far East would be mutually beneficial for all countries in conditions of fast developing
economies of China, Korea, South-East Asia and the high demand for energy and raw
materials.
Dynamics of transit container traffic via on Trans-Siberian Railway is shwn
on Figure 9.
18
Figure 9 Dynamics of transit container traffic on Trans-Siberian Railway
The volume of cargo in large containers between Russia and the countries of the
Asia-Pacific region for January - June 2013 - 2014, TEU is shown on Figure 1017.
250 000
202 509
193 968
200 000
150 000
102 172
95 842
100 000
36 872
30 298
50 000
0
1H 2013
Russia - China
1H 2014
Russia - Japan
Russia - Republic of Korea
Figure 10 The volume of cargo in large containers between Russia and the countries
of the Asia-Pacific region for January - June 2013 - 2014, TEU
The volume of cargo in large empty and loaded containers in international traffic
for January - June 2013 - 2014, TEU are shown on Figure 11.
17
CCTP Presentation during Conference ”Network of European-Asian Research capacities”, October 21, 2014.
19
Figure 11 The volume of cargo in large empty and loaded containers in international
traffic for January - June 2013 - 2014, TEU18
Figure 12 Russia’s foreign trade with Finland
5 Russian market of transport and logistics services - prospects of development
According to experts evaluation the prospects of development of the Russian
market of transport and logistics services (TLC) are not brilliant. Stagnation of the
Russian market of transport and logistics services has been begun in 2013. After peak in
2010 with a growth rate of 20.2% market moved in a downward and evaluation in 2014
is not optimistic. Indicators of transport in the second half of the year will worsen,
turnover growth is not expected. TLC market fall to 7.6% in dollar terms due to the
depreciation of the ruble, but keep the high growth segments of storage services and
express delivery.
For such pessimism there is reason - stress in geopolitics, sanctions and, as a
consequence, the price increases of financial resources, the decline in consumer and
investment demand, slowdown in the Russian economy. Before the collapse of export
and import cargo flows in 2009 negative trend was seen already (Figure 13).
18
CCTP Presentation during Conference ”Network of European-Asian Research capacities”, October 21, 2014.
20
80
38,8
60
40
20
21,7
22,3
15,8
0
2009-9,6 2010
2008
19,8
Import, %
Export, %
2,5
-0,9
-0,3
-1
-3,2
5,2
2011
2012-10 2013
2014F
-20
-40
-34,2
-60
Figure 13 Dynamic of export and import freight flow of RF in 2008-2014 (excluding
Kazakhstan and Belorussia)
If look the statistics it can imagine the consequences of mutual constraints of the
EU and Russia:
in 2013, the share of the EU (28 countries) accounted for 28.4% of imports RF food
(including beverages and tobacco), including 36.7% of meat, 33.2% of dairy products and
eggs, 30.5% vegetables (Figure 14).
Meet
Fish and Seafood
36,70%
13,00%
Milk and eggs
Fruits
vegetables
Food, including…
0,00%
33,20%
24,30%
30,50%
28,40%
5,00% 10,00% 15,00% 20,00% 25,00% 30,00% 35,00% 40,00%
Figure 14 The EU's share in the supply of food products to the Russian Federation in
2013, %
The total volume of imports from the EU amounted to 27 million tons, 7.28
million tons of food (26.6%). Determining role in the delivery of imported goods from
the EU road transport plays its share in food imports from the EU exceeds 54% (up to 4
million tons in 2013).
In 2013, the refrigerated cargo transshipment in the Big Port of St. Petersburg was
about 6 million tons of them in containers - 4 million tons.
21
Already in the first half of 2014 import goods from the EU fell by 10.6%, refrigerated
cargo transshipment in the Big Port of St. Petersburg - 5%.
Imported products, a sanctioned, planned to replace supplies from Latin America
(Argentina, Brazil, Uruguay, Chile and others.), Turkey, in part - from China, Iran, Israel
and Egypt. But to complete reorientation of supply will take at least 2-3 months to fully
manifest the effects of sanctions in 2015. Reduction of import goods from EU countries
will inevitably lead to a reduction in international road transport in the European
direction.
As a consequence, increase the value of the port as the North-West and South in
transshipment to those countries that work with Russia in the new environment. At the
same time increase the volume of domestic traffic by rail and road, as the program of
import substitution. And the reduction of foreign trade cargo flows, and changes in the
geography of deliveries, and the instability of financial and economic situation, as well
as the fall in investments, including in infrastructure - a condition in which the market for
transport and logistics services to work in 2015 and beyond19.
6 Russian air cargo market
"The policy of Russia in the sphere of air cargo: Development of multimodal logistics".
The largest logistics operators work in the segment of so-called 3pl-logistics and
provide service to their customers transport by a "door-to-door." 3pl-logistics segment is
currently the most intensively developing and the shipper and the consignee by the fact
that maximizes the use of multi-modal and other airport infrastructure (all modes of
transport, storage space, temporary storage warehouses, freight terminals for all types of
cargo), depending on set of goals: saving time or saving money by transportation cargoes.
In the Russian market of air cargo leading airports of the Moscow aviation hub, this also
takes advantage of the multi-modal logistics in cooperation with logistics operators.
Multimodality often presented model "Auto-Air", rarely used the model of "motorway –
air - train".
Moscow airports serving more than 50% of the total freight traffic in Russia.
This trend is due to both objective reasons:

proximity to production facilities of large international companies, forming air
cargo turnover;

route network of passenger air, which allows for prompt shipment of goods
predominant part in the luggage compartment cargo aircraft;

the main reason is the absence or lack of development of logistics operators in the
regions;

lack of competitive proposals from regional airports as infrastructure and
technology.
19
http://www.ati.su/Media/News.aspx?HeadingID=13&ID=50476
22
Conclusions
Russia and Russian economy is strong based on exports of commodities,
particularly energy, which was at all time high prices.
With the onset of the economic downturn in 2009 the situation has deteriorated rapidly.
Problems are connected not only with macro-economic indicators and situation but also
with the Russian business environment which is one of the most challenging in the world.
These difficult and inefficiency exist due to develop bureaucracy and corruption. Other
reasons of inefficiency of the transport and logistics sector are lack of investment has
resulted in weak infrastructure compared with international standards, structural
problems, the wide geography of the country, mountainous and desert regions.
Bureaucratic hurdles and a poor infrastructure complicate logistics processes in Russia
just as a lack of competition, insufficient transparency and limited logistics know-how
do. Nonetheless, Russia intends to become a hub between Asia and Europe.
However despite all these problems, the Russian market is still quite perspective
for European logistics and express companies, including Finland (main neighborhood
country) because Russian Federation has a major source such as oil, gas and minerals and
fast growing consumer society. The wealth generated in the past few years has meant that
there has been high demand for West European and global products, precision equipment,
electrical goods, foods, goods of high value and luxury.
Foreign direct investment has been direct to such industries as the automotive, by
multinationals keen to take advantage of the growth in levels of disposable income.
International logistics and transport companies continue to co-operate on the market and
at the same time creating international and domestic networks to facilitate the flow of
commerce.
7 Development of international transport corridors for Finland – Russian railway
transit implementation – challenge for HEA & Logistics Area
One of the priority directions for HEA & Logistics Area is to use the effective,
safe and reliable land international transport corridors which could provide the sustained
cargo transportation to countries of Asian-Pacific Region through Trans-Siberian railway.
Trans-Siberian railway is the key segment of the Russian railways system to provide
transport links between Europe and Asia which have a great potential. The quality of
transport services and safety of transported goods along Trans-Siberian railway significantly improved during last time and development will be continuing (Figure 15). Custom
clearance procedures were simplified and number of other activities for facilitate border
crossing procedures were realized. For example, the simplified procedure of the declaring
of transported containers has been introduced. It allowed reducing the demurrage of containers on the border with 3 - 5 days to several hours. Applied information technology
enables full control over wagons and containers movement in real time.
The above mentioned Trans-Eurasian railway, Trans-Mongolian, Trans-Manchurian,
Baikal- Amur, Ural routes are presented in Figure 15 that follows below.
High speed container trains allow to deliver freight through whole Russia from the Pacific
Ocean to the western borders during 11 days that is with speed over 1000 kilometers per
day. This technology allows both to reduce significantly delivery time of freights and also
to perform delivery regularly by the fixed batches and strictly according the schedule.
23
Figure 15 Trans - Siberian railway
Notes:
Possible containerized cargo amount of Euro-Asian trade which can be attracted
from sea route on transport communications of Russia (particularly along "West-East"
corridor) is estimated today in the amount of 250 - 450 thousand TEU20.
Figure 16 Euro Asian transport corridors21
20
21
TEU Twenty-foot Equivalent Unit
TransContainer company presentation, NEAR2 Final Conference, Moscow, 20-21’October 2014
24
Notes:
Transit transportation development along East - West corridor in many respects
depends on project implementation for Trans Korean highway recovery with to the TransSiberian railway22. This project will allow to provide direct rail connection between European countries and Korea Republic and considerably to increase the rail transportation
appeal of South Korean containerized cargoes by means of "a sea shoulder" (Busan Vladivostok) exception (Figure 16).
On the Figure 3 presents the Integrated multimodal services connect sea ports and
terminals of Europe, Russia and the Asia-Pacific Region and can deliver a container from
North Atlantic shores to the Pacific.
Trade volumes of Korea Republic, Japan, and Northern and North- East regions
of China with European countries are most perspective for attraction to transportations
along the West-East corridor.
The cooperation with Kazakhstan for attraction of trade volumes between the
western regions of China and European countries can become the fruitful using East West corridor branch through Kartaly - Astana – Dostyk (Figure 17).
Shipping via railway border crossing Hasan (RF) - Tumen (Chine) has been begun since
2013 and the new transshipment terminal was put into operation in the port of Rajin
(Chine). Cargo handling capacity of the terminal is 5 million tons annually.
During the first phase of operation in the port of Rajin will be transported mainly coal.
Currently, according to the JSC "Russian Railways" a consortium of Russian rail monopoly and South Korean companies POSCO, HMM and KORAIL development mechanism
project began in the direction of providing the conditions for the renewal of direct on the
Korean peninsula with access to the Trans-Siberian Railway. Rajin Port is located in the
Northern part of North Korea, 56 km from the border with Russia, the water depth of 11.5
meters, the port can receive ships of up to 40 thousand tons capacity to handle complex
allow up to 4 million tons of cargo per year23.
22
23
http://www.npktrans.ru/Doc.aspx?CatalogId=653&docId=19692
http://polpred.com/?ns=1&ns_id=1131322
25
Figure 17 Integrated multimodal network24
International transport corridor N 2 is a natural continuation of Trans-Siberian
railway. It connects Russia with European countries. There is plan of creation of the high
speed railway - Moscow - Smolensk – Red. Project implementation is possible by creation
of the international consortium25.
Development of the "North – South" international transport corridor is alternative to the
sea route connecting of Europe and Persian Gulf and the Indian Ocean (Figure 16). It is
very important route as well26.
The "North - South" international transport corridor competitiveness is reduced
because of the dual transshipment on the Caspian Sea. In this connection the important
issue is to create a direct rail link to the western branch of the corridor27.
The Western branch development of the corridor requires the creation of direct rail route
to Iran. The project agreement on construction and operation of the new railway line
Qazvin - Rasht - Astara ( Iran ) - Astara ( Azerbaijan ) was signed by three countries (
Russia , Azerbaijan and Iran) on May 2005. According this rail line construction the
western branch of the " North - South" international transport corridor will become the
shortest rail route between Baltic Sea ports of the and the Persian Gulf and in the future
can also provide the direct rail link with Pakistan and India28.
The project implementation of the Northern transport corridor "East - West" creation is realized by International union of railways. This transport corridor has to provide
24
CCTT, Deputy Secretary General, Natalia Stepanova, Network of European-Asian Research capacities. NEAR2 project. Final Conference, October 21, 2014.
25 http://doc.rzd.ru/doc/public/ru?STRUCTURE_ID=704&print=1&refererLayerId=5104&layer_id=5105&id=3997
26 http://polpred.com/news/?cnt=62&sector=4&page=5
27 Sharonov S. About transport cooperation RUSSIA and CHINA in frame of Shanghai Cooperation Organization,
magazine “East analyst”, Issue number 1/2010 Source: http://cyberleninka.ru/article/n/o-transportnom-sotrudnichestve-rossii-i-kitaya-v-ramkah-shos
28
RF
Government
Executive
Order
of
17.06.2008
№
№
877-p
"About Development Strategy of Railway Transport of the Russian Federation until 2030" Source:
http://doc.rzd.ru/doc/public/ru?STRUCTURE_ID=704&print=1&refererLayerId=5104&layer_id=5105&id=3997
26
the cargo transport connection in the direction the North East of USA and Canada (Boston, Halifax) - Norway (Narvik) - Sweden - Finland - Russia - Kazakhstan - China with
branch on the Trans-Siberian railway to the Russian ports of Primorye.
RF’s interest is to implement specified route through the Russian ports of Murmansk and Ust-Luga. Appeal of this transport corridor for freight owners is connected
with the freight delivery period reduction from midland regions of the Western and Central China to advanced industrial districts of the North East of the USA and Canada by
means of shorter route of transportation and a benefit on the speed rail transport comparing with the sea connection (Murmansk - Halifax/Boston part). It also will allow the transportation organizing in this corridor without additional crossing of borders and change of
a railway gate on the Swedish-Finnish border29. This fact will reduce the period of containers delivery. According to data of International union of Railway amounts of transportation can consist of 190 - 240 thousand TEU in both directions.
Murmansk – HEA – Trans-Siberian railway connection
Murmansk region historically is connected with the sea, within its non-freezing seaport. Hundreds years ago even Englishmen, the Dutch and Swedish people traded with
Kola peninsula, importing fur, whale skin and meat. Nowadays there is located Murmansk – Russian northern gates. It has connections by railway, road, sea and air with
other cities in the world. The export is mainly represented by various minerals resources,
oils, mineral fertilizers, coal and fish and 70% of it is done by maritime transportation.
Nevertheless, Murmansk’s important life string is the Oktyabrskaya railway, that
connects Murmansk with Saint Petersburg and Moscow, hence connects with Trans-Siberian railway. Also in Soviet times, when the development of Murmansk region was
really high, 2 branches of Oktyabrskaya railway were built: to Zapolyarnyi and Nikel to
operate with local factories and connect country with Norway’s town Kirkenes. Another
one was partly built to connect Russia from Kandalaksha and Alakurtti with Finland
through Kemijärvi to Kelloselkä. But nowadays it is mostly abandoned. The neighbor
countries have already built their branches up to the boarder: from Kemijärvi to Kelloselkä and in Karelia part from Kajaani to Vartius. Fortunately, the connection in Karelia
region is still operating and solves some economical and export issues (Figure 18).
29
Strategy of development of Russian marine port infrastructure until 2030. Moscow 2012. Source http://www.rosmorport.ru/media/File/State-Private_Partnership/strategy_2030.pdf
27
Figure 18 Murmansk region and October railway30
Europe’s air cargo corridor is overloaded currently, thus there is great project of
Humppila Eco Airport that will be located in southern Finland and will be able to operate
with significant amount of Europe’s cargo flow. In comparison with HEA project, Murmansk infrastructure is also under development. Thinking globally, It can tie these two
crucial project into one. It can be done by connecting Murmansk with Humppila by railway (Figure 19), as it has possibilities through Kandalaksha-Kelloselkä or KostamukshaKajaani routes. The first one needs additional building, as around of 50 km rail distance
is missing between closest towns between two countries.
However, railway connection is not joined together, we can suppose that this Murmansk-Humppila project can really work and be very beneficial for economies of lots of
countries.
The cargo flow can go from Murmansk to Humppila by train, where can be transported further by aircrafts, or vice versa: goods arrive to Humppila, then they are transferred by rail to Murmansk and then by sea to USA, Canada or China or by railway to
Kirkenes in Norway31. What is more, the eastern direction can be utilized also. Cargo will
be transferred from Humppila to Saint Petersburg, and then Moscow and Trans-Siberian
railway (see Figure 20).
30
Murmansk region and October railway
http://upload.wikimedia.org/wikipedia/commons/thumb/5/57/Norwegian_railway_lines_electrified.svg/477px-Norwegian_railway_lines_electrified.svg.png
31
28
Railway of Finland
Ralways
from
Humppila
till
Vainikaala
Figure 19 Finnish railway32
This Murmansk – HEA – Trans-Siberian railway connection can become extremely sufficient in the world’s relations and bring new businesses and investors into
Murmansk and Humppila regions. What is more, this integration can become the new
business transport corridor, which will develop the pipeline transportation between the
regions.
The Northern Sea Route (Figure 21) is the shortest sea route between the European
part of Russia and the Far East, and serving the ports of the Arctic and the large rivers of
Siberia (import fuel, equipment, food, waste wood, natural resources). This is the alternative of transport arteries passing through the Suez or Panama canals. If, for example,
the distance traveled by ships from the port of Murmansk port to Yokohama (Japan)
through the Suez Canal is 12,840 nautical miles, the Northern Sea Route - only 5770
nautical miles.
32
http://en.wikipedia.org/wiki/Rail_transport_in_Finland#mediaviewer/File:Finnish_railroad_network-en.svg
29
Figure 20 Tans Siberian railway33
Figure 21 The Northern Sea Route34
33
About icebreaker for Northern Sea Route providing
way_map.jpg
34 http://www.arctic-lio.com/nsr_transits
http://www.transsiberianrailway.eu/Trans-Siberian_rail-
30
The main obstacle to the passage of vessels is existence of ice. But the modern
icebreaker allows to provide year-round navigation35 and Figure 22 shows the Dynamic
of cargo volume (transit and domestic providing) on the Northern Sea Route over last 25
years.
Figure 22 Dynamic of cargo volume (transit and domestic providing) on the Northern Sea Route over last 25 years36
Increasing of the functional efficiency of railway border crossings
Increasing of the functional efficiency of railway border crossings is one of the
most important aspects of the reliable system creation for protection and safety of the
state border which is equitable to national interests of the Russian Federation in the
boundary sphere. Besides, effective functioning of railway boundary transitions is necessary condition of competitiveness increasing of the international transport corridors passing on territories of the Russian Federation.
The solution of the efficiency increasing of railway crossing check points to the
period till 2030 shall be performed within implementation of the appropriate Federal target programs.
The following major projects will be supported for the implementation by open
joint stock Company "Russian Railways" within the framework of international activities:

Organization of direct rail link Moscow - Bratislava - Vienna with gauge of 1520
mm and the creation of logistics - carrier- center near Vienna. According to
preliminary estimates it will economically to gravitate vast territory of Southern
Germany, Switzerland, the south- eastern part of France , Austria, Slovenia , the
36
http://www.arctic-lio.com/nsr_transits
31
Czech Republic , Hungary, Slovakia, Serbia, north of Croatia, north of Italy , the
south- west of Poland. These are the countries and regions with a high foreign
trade potential , in large part focused on Russia, the CIS countries , the countries
of Eastern and South- East and South Asia ;
the establishment of logistics centers in points the junction lines with different
gauges and sea ports of the Far East - to ensure Russia's trade with Japan, the
Republic of Korea and other countries in the Asia-Pacific region, as well as EuroAsian links;
Reconstruction of the North Korean railway Hasan - Rajin (1520 mm gauge) with
access to the Trans-Siberian railway and construction of logistics center in Rajin
(Democratic People's Republic of Korea).


8 Finnish investments policy and doing business
Finland is quite attractive Europien country for investments and business with a
highly developed nation and with an advanced, competitive industrial economy, legal
system, friendly and developed business environment and a thriving service sector.
Finland is a stable country, both economically and politically, located in the crossroads
of Western and Eastern markets, providing an easy access to the growing markets not
only Northern Europe but Russia, Chine and other Asian countries. Finland offers a highly
globalized and dynamic business environment with functional infrastructure, modern logistics and communications networks.
By investing in innovation and technology Finland has developed such important
area as ICT, chemical products, forestry and mining, health care and renewable energy.
Finland has success educational system due to the population of Finland is one of
the best-educated in the world. English is widely spoken throughout the population, as
well as other languages of international business.
Table 6 Finland in Figures37
Total population
5 400 000
GDP
195 billion € (at current prices)
Total area
338,000 km2, of which 89.8 % land and 11.2 %
internal waters
Neighbouring
countries
Estonia, Sweden,
Norway, Russia
Time zone
GMT+2
Population density
17.8 inhabitants per km2
Enterprises
320 000
Export
4,6 billion €
Import
5,1 billion €
Unemployment rate
7,7%
37
Doing business and
land#sthash.e1ylxp2m.dpuf
investing
in
Finland
Source:
http://www.kuopiochamber.fi/facts-about-fin-
32
8.1 Finland's Inward Foreign Investments
In the coming eight years, Finland must increase the accumulated volume of direct
foreign investments and a half times to stabilize economic growth and to achieve the level
of
investment
attractiveness
of
its
European
competitors.
The accumulated amount of foreign investments in the economy of Finland for the year
2012 amounted to 60 billion euro - this about a third of the country's GDP. According to
estimates of the Finnish Ministry of Economy, in 2020 this figure is expected to grow by
20-30 billion to exceed the European average - 42% of GDP. Sauli Niinistö, President of
Finland intends to achieve this goal. "The Finnish business environment has reached a
high level of development. The paradox is that this has no effect on the inflow of foreign
investment in the Finnish economy "- is lamented the President38.
In 2013 Finland's inward foreign direct investments (FDI) totalled EUR was 5.0
billion Euros. FDI to Finland mainly come from the EU area and have been made to
Finland particularly from39:

Sweden (52% of the investment stock),

the Netherlands (16%)

Denmark (7%)
Foreign direct investments to Finland in 2013 (investment stock) is shown on the Figure
23.
Figure 23 Foreign direct investments to Finland in 2013, investment stock40
38
Expert on-line Source: http://expert.ru/expert/2012/45/investitsionnyij-paradoks/
Source: Foreign direct investments 2013, Statistics Finland
40 Source: Portal “Statistics Finland” http://www.stat.fi/til/ssij/2013/ssij_2013_2014-11-18_kat_001_en.html
39
33
8.2 Russian investments to Finland economy
Russian-Finland co-operation which historically has been formed already many
years ago including transport operations sector which brought wide opportunities for
both Finnish and Russian economies and relationships as well.
"The closeness of such a huge country with a large population, business and economy
development possibilities and prospects should attract Finnish companies, despite the
risks involved in the Russian operations and current situation"41.
Russia is a very important source for investment for the Finnish economy (see
Figure 24). According to data from the Finnish Central Bank Russia direct investments
from Russia to Finland have more than doubled over the past ten years and Russia has
committed €583 million of direct investment into its Nordic neighbour in the last 10 years.
“Every foreign direct investment decision is based on solid facts and motivated
by long-term opportunities. In the case of Finland, the ease of doing business, the close
geographical location, good funding opportunities and the knowledge-based economy are
great assets for Russian companies,” said Tuomo Airaksinen, head of Invest in Finland,
the government agency that promotes foreign investments into Finland42.
For Russian companies there are very important competitive advantages provided by Finland’s geographical location (distance from Helsinki to St. Petersburg is only 400 kilometers), stable economy and business environment (Finland is highly regarded in international innovation rankings), and transparent legacies and tax system, government support of small-and medium-sized businesses, both local and foreign, low production costs
in comparison to Russia and a high level of respect from European suppliers and customers are all factors. All these factors positively influence on Russian investors. Russian
investments in Finland shown on the Figure 24.
41
Portal of Finland Ministry of Transport and Communications Source: http://www.lvm.fi/en
http://www.sptimes.ru/archive/pdf/1782.pdf The Saint-Petersburg times, page 6, Russia’s Finnish Investments Double Over 10 YearsWednesday, October 16, 2013
42
34
Figure 24 Russian investments in Finland
Finland also has a skilled, Russian- and English-speaking workforce. Russians
companies come to Finland market as well because there is the efficient infrastructure
and the stability of the transit trade from the EU to Russia, which already passes through
Finland because the countries use the same rail gauge (1520 mm). According to information provided by Invest in Finland, the country is also a gateway to EU markets for
Russian companies.
8.3 Productive and successful examples of Finnish-Russian co-operation by Russian investment flows in to Finland
According to data of Finland statistic provided by Ari Karjalainen, the project
manager for Helsinki urban development projects at the Economic and Planning Center
of the City of Helsinki Russians invested an estimated 900 million Euros into Finland in
2012.
Most important Russian investments flow:

Arctech shipyard in Helsinki is part-owned by Russians (state-owned United Shipbuilding Corporation); The Arctech shipyard in Helsinki is productive example of Finnish-Russian co-operation: Russian investors own half of that venture. Russia’s gas giant
Gazprom is also active in Finland, owning a quarter of the Finnish firm Gasum;

One of the most significant Russian operators in Finland is the petrol company
Teboil, which is owned by the Russian oil giant Lukoil. Teboil’s turnover last year was
some two and a half billion euros;

Another substantial Russian operation in Finland is Norilsk Nickel, which is among
other things a big shareholder in the Talvivaara mine. The company’s Harjavalta plant
employs some 270 people;

A large shopping and entertainment complex in Vaalimaa, the busiest border crossing between Russia and Finland. Russian investors have already contributed up to 70
million euros to the project, which is due to open in 2015;
35

The Sirius Sport Resort, not far from Kotka which opened in July 2013 thanks to
the efforts of St. Petersburg businessmen. It is a center for extreme sports, featuring an
indoor wind tunnel and a wave pool for surfing all year round. According to the Helsingin
Sanomat newspaper, the volume of investments in the project reached 15 billion euros;

Ice hockey club Helsinki Arena (estimates range from the hundreds of millions into
the billions);

real estate market

etc.
8.4 Prospects of Finland – Russian trade co-operation
23 of October 2014 in Helsinki, the Finnish-Russian Chamber of Commerce presented Finland - Russia trade "barometer" in Helsinki. According Finnish-Russian Chamber of Commerce data: Finnish export to Russia in January-July, 2014 saved practically
the same level how it was in 2011 when the cost of export made 2,8 billion Euros. Import
from Russia to Finland saved approximately at the level how it was in 2010 - 5,4 billion
Euros.
The peak of import and export was noted in 2008, in 2009 there was a sharp falling, then there was some growth in 2010-2013, and this year decrease was again noted. It
is explained by three main reasons:

policy,

sanctions,

growth of the currency rate in the Russian market.
The executive director of the Finnish-Russian chamber of commerce Mirya Tiri
told about present situation in the Finnish-Russian market. According to her, political
risks increased in Russia and problems of financing of the Russian clients today. With
weakening of ruble exchange rate, obviously, already got used, even customs problems
because of decrease in volumes of cross-border trade aren't a problem number one anymore.
Problem number one is in EU and Russian policy. Despite it, investments into
Russia were made as before, and some considerable changes in this direction aren’t expected and still as Mirya Tiri told - 20–30% of respondents plan to open subsidiary in
Russia. Finnish companies still consider that presence in the Russian market is very important. Expectations of development of the Russian economy for the next months are
very low. Some reduction of economy expects most of respondents — 65% of respondents from 700 legal entities who took part in research, the carried-out Chamber of commerce. And though development prospects on the near future both for export, and for
business in Russia not absolutely iridescent, however the fifth part of respondents waits
for growth.
In the service sector expectations of growth are strongest, while the industrial sector is set more gloomy. In the next 2–3 years 23% of respondents trust in the potential of
growth, 61% consider it a little probable, 15% estimate potential at the former level or
expect its decrease. According to Miryi Tiri, it even is surprising since Finns on character
are pessimists, but among them considerable number of optimists, even despite all realities of today's difficult political and economic situation around Russia.
With careful optimism legal entities look in future investments in Russia (by the
way, with falling of ruble exchange rate in relation to euro investment become favorable
36
capital investments since the prices in domestic market don't keep up with growth of currency). 26% of respondents next year plan to make new investments. In the sphere of
trade these figures are higher - 34%, a services sector - 21% and the industry - 22%.
By the way, if in the spring of 2014 import to Russia first of all was complicated
because of ruble exchange rate, today the main problem - political risks.
In the long term of possibility of the Russian market are regarded positively. The absolute
majority considers the Russian market potential, approximately the fifth part - high-potential. The Finnish investments made now go back to a stage of growth of the market;
many already speak about new repartition of the Russian market in the near future.
Matti Anttonen - the adviser of the Ministry of Foreign Affairs of Finland made the speech
and answered questions in the Finnish-Russian chamber of commerce. According to him,
Russians are more politized also falling of ruble exchange rate in relation to euro and
dollar is very painfully perceived in Russia: "In Moscow the exchange rate can be seen
on numerous advertizing signs of banks and exchange offices. If to ask the Finn on the
street, how much the dollar in relation to euro is - hardly it will be able to answer this
question
which
is
very
easy
for
Russian".
On Matti Anttonen's supervision, today in Russia the vector of opinions in relation to EU
countries sharply changed: "A half of Russians now thinks that the best friend — China.
But here, asymmetry is available: annual GDP growth of China makes 7%, Russia has
0%. To turn a pipe to the east — it doesn't mean at all to modernize national economy
and to develop it as it successfully does China. Today the EU market is much more important for Russia, than the Customs union with Belarus and Kazakhstan". According to
him, the market of Russia is also important for the EU, and it can't be lost. Therefore the
adviser of the Ministry of Foreign Affairs doesn't believe that there will be new sanctions
concerning Russia43.
Finnish-Russian Chamber of Commerce surveyed of Finnish businessmen working in Russia. Respondents were asked to assess the situation in the country to identify
the key issues and to talk about whether they plan to increase investments. In the "rating"
of the problems encountered when working in Russia, traditional customs and bureaucracy replaced the ruble has fallen (44% of respondents called it the most acute problem),
and the political situation (31%). Assessing changes in their business in Russia since the
beginning of 2014, 27% of respondents have said that it grew up, 31% reported to the
reduction. Most (40%) stated that their state companies remained unchanged. The most
optimistic about the future trading of the company - more than half of the representatives
of the industry expect growth. 69% of Finnish businessmen expect the reduction of the
Russian economy. At the same time 28% of the companies surveyed are going to make
new or additional investments in Russia during 2015. In the long term, the Finns optimistic: 34% of respondents see a high potential of Russia, 53% - sufficient capacity and only
13% - weak or non-existent44.
In Conclusion it is possible to say that according by information of Finnish-Russian Chamber of Commerce Russian businesses including logistics sector is looking for
markets abroad for investment.
9 Infrastructure of HEA&Logistics Area and transport corridors conection
43
“Barometer” of Finland – Russian trade” Source http://www.kauppatie.com/2014/11-2014/rus-1.shtml
http://polpred.com/news/?cnt=168&sector=1
44Source:
37
Infrastructure of HEA&Logistics Area will be connected with the following
transport corridors and routes:
Figure 25 USA – Finland (Humppila) – Asia AirLandBridge
Figure 25 USA – Finland (Humppila) – Asia AirLandBridge
Infrastructure of HEA&Logistics Area will be connected with the following
transport corridors and routes:
Table 7 Connection HEA&Logistics Area with Transport corridors
Connection
via Corridor
Europe – Mongolia-China
Via Trans-Siberian Euro- (Humppila, Helsinki) – FinAsian transport corridor
land, Russia, Kazakhstan,
Mongolia, China
(Figure 26)
Link
North Europe – Iran and Via North Euro - Asian (Humppila, Helsinki) – FinIndia (Figure 27)
transport corridor
land, Germany, Belarus,
Poland Russia, Iran and India
North Europe – Russian Via Trans - Siberian rail- (Humpila, Kouvola) FinFar East – Mongolia- Japan way network
land SPb – Moscow - Novo(Figure 26)
sibirsk – Irkutsk-Vladivostok or Nakhoka) – Japan
(Sea of Japan)
(Humpila, Kouvola) Finland SPb Moscow- Novosibirsk-Ulan-Ude-Naushki
38
North Europe – China
(Figure 26)
(Figure 26)
(Figure 26)
Via branch of the Trans - (Humpila, Kouvola) FinSiberian railway network land SPb – Moscow- Novoand the Manchurian route sibirsk-Karymskaya-Zabaykalsk) –China (Harbin Beijing via Manchuria)
Via branch of the Trans - (Humpila, Kouvola) FinSiberian railway network land SPb Moscow- Yekateand the Trans Kazakh route rinburg-Kurgan) – Kazakhstan
(Petrovavlosk
–
Astana - Dostyk) – China
(Lanzhou-Zhengzhou-Beijing)
Trans-Asian Air route and
Trans Siberian Air route
The railway corridors between EU and Asia are characterized by quite long routs
crossing different countries (length of routes from 8,000 to 13,000 kilometres, as shown
on the Figure 25 and crossing border. But Finland and Russia have the same 1520 mm
gauge.
HEA&Logistic Area allows follow to Transport policy of Finland and will support
the further development of foreign trade cargo transit through its territory, gradually increasing the volume to the level of pre-crisis period, as transit contributes to the development of internal transport services in the country and provides additional features to Finnish companies exporting Access to European transport flows45.
45
Competitiveness and well-being through responsible transport. Government Report on Transport Policy submitted
to the Parliament of Finland 2012. Source: http://www.lvm.fi/docs/en/1986563_DLFE-16973.pdf
39
Figure 26 International corridor West - East46
Multimodal Complex consists of the following infrastructure:








International Eco Cargo Airport (class A) with aproximetely 4 km take off runway;
Eco Industrial and logistic zone;
Temporary storage Eco warehouses zone;
Eco Smart Business Park;
Creation and support of Free Zone
Physical & Virtual Intelligent Logistic Hub
Dry Port
Railway Station
S.B.Postnikov, Deputy Head of the economic environment and the strategic development of JSC “RZD“,
Final conference of the NEAR2 project, 21 October 2014, Moscow
46
40
Figure 27 International corridor North - South47
Prospects for the regional development and growth:


The starting point is to attract domestic and international investments to HEA.
The investments follow the growth of the customer markets, which happens via
international business networks.

Local players and new businesses and support services create jobs.

The development of the prerequisites for business takes place together with businesses and officials.

To create a Network of interested organizations, specialist and communities who
could use existing financing and founds for HEA design, support and activity promotion.

Training in the field of rail transport is to be developed according to demand (Air,
Rail and motorcar transport builders, mechanics, drivers, agents, managers and transport
management training).

Research into applying academic study to the field of transport is being actively
carried out by the Forssa unit of the HAMK University of Applied Science.
A further possibility could be the use of the services of the various National Science
Academies, in order to explore the role that they can play in promoting south-south and
north-south mobility of transport and travel researchers.
S.B.Postnikov, Deputy Head of the economic environment and the strategic development of JSC “RZD“, Final conference of the NEAR2 project, 21 October 2014, Moscow
47
41
10 Swot analysis of competitive advanteges of HEA&Logistics Area
Strengths
Weaknesses
 Intensive regional and internati Proactive & pro-business regional authority
onal competitiveness
and strong support from regional authority of
 Political situation, mutual Rusproject idea
sian EU sanctions which brake
 Active and competitive business environment
and destroy transport & logis Original concept of ecological intermodal
tics business
airport and business park (Airport&Logistic
 Customs border with Russia
Area)
(for Euro Asian railway corri 2000 ha reserved land for world class physidor usage)
cal infrastructure of logistic area&4 km runway design & development
 Excellent opportunity for ne international
business and ventures
 Advantageous geographical position
 Potential of the industrial and economic development of USA, CHINE and EU
 Uncluttered EU air traffic zone
 Nearness to the Russian border for further
connection of railway connection with Asian
countries; possibility of usage the potential
of Russian forwarding companies and operators pull
 The same rail gauge with Russian railway
 Exit through Murmansk by railway to the
North Sea Route
 Ideal location in middle of the busiest part of
Finland location between largest towns (Helsinki, Tampere and Turku)
 Possibility for the strategic connectivity and
frequency of flights
 Advantageous eco-politic location of Finland
and Western because of free land without too
many inhabitants
 Stable political, economic and social conditions
 No corruption business environment
 Nearness of Finland’s most important ports
(Turku, Pori, Helsinki) are within 1,5 hours
journey
 Educated Workforce, good and low-cost living environment for employees and skilled
manpower available
 Strong legal system and business-friendly environment and tax structure
 Existence trunk roads and a railway
42
 Centre of training for the logistics and transportation sectors (Häme University of Applied Sciences)
 HEA &Logistic Area included to Strategy for
regional development
Opportunities
Threats
 Creation of new logistics area and a cargo
airport creation on the basis of ecology and
sustainable development (New Eco Airport&Logistics Area design – EcoAirBridge
between USA and Chine)
 Organisation the connection between USA
and Asian countries through New Eco Airport&Logistics Area to use road, rail and
maritime transportation.
 To organise the connection with Asian countries through both corridors : through Trans
Siberian railway and Northern Sea Route as
well.
 Design of new Eco Intelligent Multimodal
Complex consist of the following infrastructure:
 International Eco Cargo Airport;
 Eco Industrial and logistic zone;
 Temporary storage Eco warehouses zone;
 Eco Smart Business Park;
 Creation and support of Free Zone
 Physical & Virtual Intelligent Logistic Hub
 Dry Port
 Railway Station
 Design of airport’s 4 km long runway which
will enable provide larger cargo planes safe
take-offs and landings.
 Organisation the Center of Transport & Logistics Eco, Intelligent and Smart Technologies for Eco Intelligent Multimodal Complex
personal training and staff development
 Region development through new businesses,
worker places and international connection
and activities
 Strong possibility to unload Vantaa (Helsinki) airport (where 67% of cargo which go
further to Russia) and HEA will located only
within 100 km from Vantaa (it means it is
possible to use practically the same transport
connection)
 Nearness Cargo Terminal at
Helsinki Airport
 The similar Russian project
near Ust-Luga Harbour for the
similar tasks solving (good alternative)
 Long period of waiting of Finland Governmental and Parliament permission for the project
realization
 High land cost
 Limited availability of financial resources needed for the
airport’s development both on
national and municipal level
 Political situation (concerning
Russia issue)
43
 To increase of cargo export and transit trough
Finland and Russia to Asian countries
11 Conclusion
Sometimes the successful development of a small country often depends on its
geographical position and the ability to use this fact to grow of the socio-economic
development and support. For example being between East and West (in the center of the
bridge connecting the East and the West, Russia and China with America) as well as being
the closest neighbour to Russia, Finland could become a possible point providing the
junction interaction between USA - Russia and China (including other Asian countries).
HEA is located between three biggest centers (Turku, Tampere and Helsinki) is a hub
where all modes of transports are presented (air - future, road and rail). Apart from those
mentioned facts, HEA is located near practically all ports of Finland and being located to
the crossroads of Helsinki Pori and Turku Tampere, the airport has good connections to
each port by road and rail transport modes. As it is known the main transit route in Finland
to Russia (to St. Petersburg and Moscow) passes through Turku, Hanko, Helsinki, Kotka
and Hamina to St. Petersburg and Moscow. Existing railway network enables smooth
connection to Helsinki and all the way to Oulu and continue to Murmansk and it ports
(and further connection with Northern sea way).
The infrastructure is ideal, and with Finnish know-how in ecological issues and
German/Finland know-how of smart technologies it is possible to build a leading Eco
Airport in the world.
In the same time Humppila has strong railway connection with Kouvola railway
hub and motorcar connection where transportation flows can be distributed by truck, air
and rail. Rail transportation can be organised by block train (consists of 50-60 wagons)
which go to Kouvola rail hub (cross border rail hub with Russia). It allows transporting
the freight from HEA to China for example through Russia and after Kazakhstan. In this
case the transit container transportation can be carried out in four times faster: the time it
takes to deliver the goods, will be reduced from 80 to 20 days. With this rail transportation
will become a good alternative for Finland by the widespread maritime transport. It is
known that European companies specializing in forestry and engineering industries as
44
well as Chinese suppliers of goods to Europe are interested in fast regular rail links with
China.
The main transit point for air cargo coming today in the North-West of Russia is
Helsinki airport. Today, 67% of its turnover (150 thousand tons) goes to Russia, and
the turnover is growing steadily every year. Airports other Baltic Sea Countries also work
to organize freight transit to Russia, such 90% of their traffic (54 thousand tons) come to
Russia via those ports. It is very understood that the profits from processing Russian cargo
remains in Finland and other Baltic Sea Countries. Airport "Pulkovo" in Saint-Petersburg
is able to process only 30 thousand tons per year (That too little). Pulkovo has only two
runways and long time already is not able to handle the workload. In this connection all
market participants are told - they need a new cargo airport and modern logistics area!
HEA which is located not far from Russian border, in the center of Finland and on the
intersection of all main roads with all the approaches to ports, railway road and highway
could become such airport.
Nowadays air freight transportation from Europe to Chine is quite popular
because can both to save the client time and money as well. Fifteen hundred airports in
China actively work, four of them are major international (Hong Kong, Shanghai,
Guangzhou, Beijing). Within one day (maximum of three) cargo can be delivered by
plane from China to Russia (via Helsinki airport for example). But of course this way is
more expensive. Other variant that is often used by some transport companies - is
shipping by air to any port (so it can be HEA) in Finland and then freight goes to Russia
through Saint - Petersburg. This way of transportation will be cheaper than a direct flight
to Moscow. In this connection after Helsinki airport the goods are delivered by
motorway to the point of final destination located on the territory of Russia. Similar
situation is observed not only in the airline industry but also for the delivery of goods to
the territory of Russia with container shipping, especially in the Baltic region.
HEA & Logistics Area and Euro-Asian Transport Linkages!!!
For today Finland is the strong competitor among the EU countries for the cargo
transit from USA through Russian transit streams and further to Asian countries. From
the other hand, Russian cargos lines make also a significant share in the aggregate traffic
of cargoes from Europe, thus the basic goods lines go through the North European
countries. Many businessmen prefer to transport the cargo on this route because cargo
transportation through Finland has serious advantages, first of all, there is no necessity to
cross borders of the third countries (Poland, Ukrain, Belarus etc.), besides it, the
transportation spheres and logistical services develop actively in these countries including
Finland.
The activity of the cargo transportation from Europe to Russia through Finland
constantly increases because the Petersburg port physically does not cope with a goods
traffic going through it. Terms of the containers processing and the cargos registration
exceed one week that forces cargo owners to choose other routes. Operators enter extra
charges for each container delivered in port of Petersburg now that does not raise its
status. Consignors prefer to carry cargoes through Finland, in spite of the fact that
transportation by motor transport from ports of this country to Russia makes their delivery
more expensive. Also there is a possibility to keep cargo from Europe in warehouses
without customs registration as long time as you need in Finland that is not possible in
Russia.
The cargo connection between Russia and Finland is stable and also has a stock
for essential increase in transit of cargoes. Presence of a railway track of 1520 mm in
45
Finland rather simplifies a railway delivery of cargoes (the same as in Russia), at border
crossing it is not necessary to change wheel pairs as it is necessary to do transporting
cargoes to Europe. Nevertheless, at transportation of cargo from Finland we cannot
manage without application of sea transport yet. In this connection, new HEA & Logistics
Area project has huge advantage to solve this problem improving this cargo route. For
Example, Helsinki already many years ago have been received unofficial status of the
fourth largest airport of Moscow. Freight flow growth annually in this connection HEA
which is located in 100 km from Helsinki airport could from one hand unload Vantaa
airport and from another hand will allow increasing these cargo flows.
Once more interest can be cover North area. The cargo flow can go from
Murmansk to Humppila by train, where can be transported further by aircrafts, or vice
versa: goods arrive to Humppila, then they are transferred by rail to Murmansk and then
by sea to USA, Canada or China or by railway to Kirkenes in Norway48. What is more,
the eastern direction can be utilized also. Cargo will be transferred from Humppila to
Saint Petersburg, and then Moscow and Trans-Siberian railway. This Murmansk – HEA
– Trans-Siberian railway connection can become extremely sufficient in the world’s
relations and bring new businesses and investors into Murmansk and Humppila regions.
What is more, this integration can become the new business transport corridor, which will
develop the pipeline transportation between the regions.
In this connection and on the base of above mentioned:
1.
Humppila region can be organized as big Multimodal Complex providing
connection between USA and Chine (and other Asian countries) through Russia.
2.
HEA can become the central point where it is possible to organize a knot or the
multimodal center as the intermediate distributive center of interaction and transit
between several developed economies and centers of development.
3.
Due to unique position only 100 km from Helsinki, HEA together with
Logistics&Area could unload Helsinki-Vantaa Airport.
4.
Central geographical location between USA and Asia could allow to invite many
air companies to optimize air route minimizing time.
5.
HEA could organize connection with North regions of Russia.
Multimodal Complex consists of the following infrastructure:

International Eco Cargo Airport (class A) with aproximetely 4 km take off runway;

Eco Industrial and logistic zone;

Temporary storage Eco warehouses zone;

Eco Smart Business Park;

Creation and support of Free Zone

Physical & Virtual Intelligent Logistic Hub

Dry Port

Railway Station.
Prospects for the regional development and growth:

The starting point is to attract domestic and international investments to HEA.

The investments follow the growth of the customer markets, which happens via
international business networks.

Local players and new businesses and support services create jobs.
48
http://upload.wikimedia.org/wikipedia/commons/thumb/5/57/Norwegian_railway_lines_electrified.svg/477px-Norwegian_railway_lines_electrified.svg.png
46

The development of the prerequisites for business takes place together with
businesses and officials.

To create a Network of interested organizations, specialist and communities who
could use existing financing and founds for HEA design, support and activity promotion.

Training in the field of rail transport is to be developed according to demand (Air,
Rail and motorcar transport builders, mechanics, drivers, agents, managers and transport
management training).

Research into applying academic study to the field of transport is being actively
carried out by the HAMK University of Applied Science.
47

Humppila Airport and Logistics Area development, Russian Markets

Transcription

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