Ukraine transport strategy alignment within the context of eu integration

- Ukraine Transport Strategy Alignment within

the context of EU Integration

RESTORING UKRAINE ROLE TRANSIT POTENTIAL OF NEW UKRAINE -

A SYSTEMATIC APPROACH TO INCREASE TRANSIT TRAFFIC

Results of this publication were obtained during EU funded Project IDEA

Dr. Ashraf Hamed

Kiev April 28, 2016

1

1 Trends in Ukraine freight transit (2013)

2 Ukraine in TRACECA / Regional Context

3 Attractiveness of Transport corridor in Ukraine

4 Border crossing Impact and benchmarking

5 National Strategy, the road ahead

6 TEN-T corridor and Demand Forecast Scenarios

2 Ukraine Transport Strategy Alignment within the context of EU Integration

0

50

100

150

200

250

300

350

400

450

500

Rail Road inland waterways

Freigh Traffic (tons)

2013 mln. Tons 2012 mln. Tons 2011 mln. Tons

Trends in Ukraine Freight Transport Let us look at the numers

Railway is the backbone 60%

Roads at 23%

Inland Waterways almost nothing

Shares seems to be stable over years

http://www.ukrstat.gov.ua/operativ/operativ2013/tz/vp/vp_u/vp0813_u.htm


-

50,000

100,000

150,000

200,000

250,000

Rail Road inland waterways

Freight Traffic (ton.km)

2013 mln. Tons.km 2012 mln. Tons.km 2011 mln. Tons.km

......and in Ton.km ....!!

Railway is also seeing a slight loss and still carry almost 60% share

Roads is relatively stable and the share is limited to 10%

Inland Waterways still play no role with a share of almost 2%

http://www.ukrstat.gov.ua/operativ/operativ2013/tz/vp/vp_u/vp0813_u.htm


- 10,000 20,000 30,000 40,000 50,000 60,000

Rail

Road

Mari

tim

e

2011

2012

2013

And what does the Transit look like.....?

Railway losing significantly

Roads can still maintain its share

Maritime transit had a drop on 2012

http://www.ukrstat.gov.ua/operativ/operativ2013/tz/tranz/tranz_u/tranz0213_u.htm


-75% -25% 25% 75%

Rail

Road

Maritime

Aviation

Pipeline

2011/ 2010

2012 / 2011

2013 / 2012

Let s look at the percents.....? Railway had a recovery in 2010 and losing since then almost 25%

http://www.ukrstat.gov.ua/operativ/operativ2013/tz/tranz/tranz_u/tranz0213_u.htm

Roads has a significant loss in 2012 and 2013

Maritime had a significant loss last year and seems to recover


Let s look at the big Picture of Transit

These are simulated the freight flows (base year 2008)

Validated with UNCOM Trade values 2008

We can see main corridors domestically and internationally and their directions


And for railroad….. Rail roads carry significantly more than roads

We can see main corridors domestically and internationally and their directions


Model simulated SCENARIOS (2020)

Base Scenario 2008

– status including the multimodal freight network and the freight demand of the base year 2008.

1. Reference Scenario 2020 (DO Nothing)

– The network is the same as for the Base Scenario 2008.

2. Border Crossing Scenario 2020

– Do Nothing plus improvements of the border crossings. Waiting times at border crossings are reduced to a maximum of 6 hours for roads and 8 hours for railway

3. Maritime Connections Scenario 2020

– Capacities for transshipment links, representing the ports were increased by 100%.

4. Infrastructure Scenario 2020

– Infrastructure increasing capacity of certain link (Rail/Road)


ROADS : Do Nothing


ROADS :Border crossing


RAIL & Maritime / Do Nothing


RAIL & Maritime / Border crossing


Comparison of ports’ traffic

There is forecast of potential of increase with the improved border crossing for 2020

That seem to be triggered by increase in trade


2020: ODESSA 2008: ODESSA


2008 AZOFF SEA PORTS


2020 AZOFF SEA PORTS


2020 GEORGIA PORTS


What could be reasons for Transit loss?

Political reasons

Possibly Customs unions RUS / BY / KAZ simplifying transit movements within these countries as well as promoting trade among them

Possible Belorussia import via Russian ports

Lack of clear strategy for Ukraine Transport for several years

Incompatibility with EU documentation NCTS documentation system add strong resistance to crossing Ukraine


How attractive is Ukraine Logistics

Compare with


Did Ukraine develop ?

LPI development


Is Ukraine attractive as a corridor?

TRACECA calculated the attractiveness index TRX Based on driven routes journals obtained from IRU in the framework of NELTI

October 2009 for three routes

Trans Russian Route

Trans Caucasus Route

Trans Turkey / Iran Route

(relevant for Ukraine)


TRAX measures resistances / Attractiveness FOR ROUTES Highest

resistance in Ukraine- Trans

Caucasus


TRANS – CAUCASUS / Ukraine TRAX in detail

ROMANIA

BULGARIA

POLAND

UKRAINE

GEORGIA

AZERBAIJAN

KAZAKHSTAN

UZBEKISTAN

KIRGIZSTAN

Region TRAX TCR-Europe TRAX TCR-Caucasus TRAX TCR-CA

total Countries Ukraine,

Romania, Bulgaria

Black Sea ferry, Georgia, Azerbajidzan, Caspian Ferry

Kazakhstan, Uzbekistan, Kyrgyzstan

TRAX total 2765 3480 2616 8861

TRAX stretches 438 1381 549 2368

TRAX nodes 2327 2099 2067 6493

Nodes (ports and x-ing)

are the bottlenecks

Time

Cost Reliability Security

Bad and good news

24

TRAX Ukraine

Non-physical barriers and uncertainty are the easiest to improve without major investments.

Just have the will to do that

administrative reforms and will ultimately target: Predictability of time and costs at border crossing including land and

maritime borders

Overdue improvements of transit documentation to compatibility with European Standards

In particular

Ukraine has introduced a new Customs Code which the importers as well as the freight forwarding and customs’ brokerage industry report as much improved and more workable than the previous one.

Still further alignment is needed for example the implementation of NCTS documentation system



27,2

54,7

30,936,9

28,231,4

27,2 26,430,8

41,9

56,7

49,5

41,534,5

30,4

0,0

10,0

20,0

30,0

40,0

50,0

60,0

Nov

ie Y

arilo

vich

i

Bac

hevs

k

Gop

tovk

a

Dolzh

ansk

y

Nov

oazo

vsk

Ren

i

Platono

voe

Mam

aliga

Porub

noe

Dya

kovo

e

Cho

p (Tisa)

Uzh

gorod

She

gini

Rav

a-Rus

ska

Yag

odin

benchmark

Time Indicator

101,6

44,5

74,6

100,786,5

95,0105,5

80,0 73,4 71,0

116,7103,7

94,8

71,8

89,4

0,0

20,0

40,0

60,0

80,0

100,0

120,0

140,0

Nov

ie Y

arilo

vich

i

Bac

hevs

k

Gop

tovk

a

Dolzh

ansk

y

Nov

oazo

vsk

Ren

i

Platono

voe

Mam

aliga

Porub

noe

Dya

kovo

e

Cho

p (T

isa)

Uzh

gorod

She

gini

Rav

a-Rus

ska

Yag

odin

benchmark

Cost Indicator

Indicators Scores at Ukrainian BCPs in 2015

6,06,8 6,6 6,3

4,9

6,0 6,1 6,0 5,76,3 6,6 6,3

6,7 6,4 6,5

0,0

1,0

2,0

3,0

4,0

5,0

6,0

7,0

8,0

Nov

ie Y

arilo

vich

i

Bache

vsk

Gop

tovk

a

Dolzh

ansk

y

Nov

oazo

vsk

Ren

i

Plato

novo

e

Mam

aliga

Porub

noe

Dya

kovo

e

Cho

p (T

isa)

Uzh

goro

d

Shegi

ni

Rav

a-Rus

ska

Yagod

in

benchmark

Clearance Process Efficiency Indicator


36.5

11.0

15.7

8.8

18.8

5.2

0.0 10.0 20.0 30.0 40.0

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Time index

Aggregated index BCPs in 2015: country comparisons

130.1

33.0

46.6

22.0

47.9

10.0

0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Time spent preparing documents, sub index

45.9

18.4

26.3

12.4

40.6

12.0

0.0 10.0 20.0 30.0 40.0 50.0

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Time Index between arrival to the border and beginning of passing control

6.6

3.7

5.4

3.3

5.5

4.0

0.0 2.0 4.0 6.0 8.0

Ukraine

Mold…

Georgia

Belarus

Azer…

Arme…

Time Index needed from submission of the documents for control until completion of the

control


91.8

63.5

95.1

73.7

148.6

61.3

0.0 50.0 100.0 150.0 200.0

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Cost index

Aggregated index BCPs in 2015: country comparisons

6.2

6.7

6.9

6.5

6.8

7.0

5.8 6.0 6.2 6.4 6.6 6.8 7.0 7.2

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Clearance process efficiency, index

8.1

19.7

18.4

15.5

18.3

18.0

0.0 5.0 10.0 15.0 20.0 25.0

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Risk, index

10.6

9.6

11.1

10.2

9.2

10.9

0.0 2.0 4.0 6.0 8.0 10.0 12.0

Ukraine

Moldova

Georgia

Belarus

Azerbaijan

Armenia

Customs procedures, index


Improvement/deterioration for road BCPs of Ukraine

2012 Ukraine made trading across borders more difficult by introducing additional inspections for customs clearance of imports.

2014 Releasing customs declarations quicker and reducing the number of physical inspections.

2015 Advance exchange of information of goods and transport means crossing the borders of Georgia and Ukraine

What Should be done?

With the understanding that Ukraine may still have a chance to stop the loss of transit traffic and improve transit shares; and align its transport network with EU network and policy guidelines

The concerns remains valid, if Ukraine is determined to do the necessary steps….What to do?

1. Transparent transport policy

2. Updated Strategy

3. Realistic action plan

4. Legislation approximation 1. Transposition

2. implementation and

3. Enforcement)


Framing answers to right Questions

• Establish Policy Agenda

• Update Transport Strategy

• Fight against corruption

• Sector Reforms and Restructure

• Multimodality and role of transit

• Integrated Logistics System

• Allocate funds to rationally

prioritized investments

• What are the overarching objectives

we want to achieve?

• What fundamental policy principles

guide our efforts to achieve

objectives?

• What are the shortcomings in

existing arrangements, both now

and in the future

• Given forecast demand, the

identified shortcomings and the

investment and institutional

resources likely to be available over

the planning period …..

What are the most important first steps

in implementing these strategies?

Ukraine Transport Strategy Alignment within the context of EU Integration 31

Strategy Update


REGIONAL TRAFFIC FLOW PATTERNS


Rail freight flow patterns

34

Roads freight flow patterns

35

Rail passenger flow patterns

36

Roads passenger flow patterns

37

Level of service on the EaP road

38

A Free flow

B Reasonably free flow

C Stable flow

D Approaching unstable flow

E Unstable flow

F Forced or breakdown flow

REGIONAL DEMAND FORECAST DEVELOPMENT SCENARIOS (2030)


Base Year vs Baseline 2030 freight flow patterns

40

Rail

Integration vs Baseline 2030 freight flow patterns

41

Rail

Stagnation vs Baseline 2030 freight flow patterns

42

Rail

Base Year vs Baseline 2030 freight flow patterns

43

Road

Integration vs Baseline 2030 freight flow patterns

44

Road

Stagnation vs Baseline 2030 freight flow patterns

45

Road

Baseline 2030 LoS-

46

A Free flow


C Stable flow


E Unstable flow


Integration 2030 LoS-

47

A Free flow


C Stable flow


E Unstable flow


Stagnation 2030 LoS

48

A Free flow


C Stable flow


E Unstable flow


Strategy Update


50

Thank you for your attention

Ukraine Transport Strategy Alignment within the context of EU Integration

Presentations & Public Speaking

Ukraine transport strategy alignment within the context of eu integration