The EDB: Container transit along the China – EAEU – EU axis is practically guaranteed to grow explosively, up to 500,000 TEU, by 2020

12 April 2018

By 2020, we forecast transit to total 450,000-500,000 TEU while in the longer term the aggregate container flow on the China – EAEU – EU axis may reach 2 million TEU.

 St. Petersburg, 12 April 2018. The evolvement of China’s Belt and Road Initiative (BRI) has boosted shipments from China to Europe and vice versa using the railway network of the Eurasian Economic Union (EAEU) countries. In 2010-2017, transit container traffic from China to the EU has grown from 5,600 TEU (a 20-foot container equivalent) to almost 164,000 TEU. Railway container traffic from the EU to China has increased from 1,300 TEU in 2010 to over 98,000 TEU in 2017. In 2017, container transit through the EAEU along the China – Europe – China axis totalled 262,000 TEU, which is 1.8 times more than in 2016.

According to the EDB’s analysis, in 2013-2016 the annual doubling of the number of container trains and volume of container cargoes along China – EAEU – EU routes was largely attributable to subsidisation of export railway freight traffic by Chinese authorities. The actual “zeroing out” of Chinese transit container freight rate has motivated Chinese exporters to rapidly shift from sea routes to railway transport. These data and analysis are presented in the report titled Silk Road Transport Corridors: Assessment of Trans-EAEU Freight Traffic Growth Potential prepared by the EDB Centre for Integration Studies.

The Centre for Integration Studies estimates that in 2016 the subsidies extended by Chinese provinces approximated US $88 million. The estimate is based on the assumption that the average container transport subsidy was US $2,500 per 40-foot container, and that the total number of subsidised 40-foot containers originating from China’s central provinces was around 35,000. Subsidies per 40-foot container average a mere 0.3-0.4% of the value of cargo shipped in it.

In recent years, growth was achieved with a through rate of US $4,800-6,000 per 40-foot container (with subsidies approximating 40%). Whether Chinese provinces will preserve and enhance their transport subsidies is the key issue as regards the prospective increases in container traffic.

Railway transport offers a range of non-price advantages for consignors. It is convenient in that it cuts delivery time and ensures regularity and door-to-door delivery. “The accuracy of railway timetables (99.7% of container trains between China and Europe run exactly to schedule), door-to-door delivery and delivery times that are approximately three times less compared to maritime transport are the advantages of railway transport,” Evgeny Vinokurov, Director of the Centre for Integration Studies, notes. “The non-price potential has not been exhausted yet: the number of container trains per week may triple by 2020, to some 100 a week.”

The Centre for Integration Studies believes that the currently used through rate (including subsidies) of US $5,500 per 40-foot container on average may double container flows to 500,000 TEU in 2020. Beyond 2020, maintaining the freight rates at the previous level would not produce such a noticeable effect, and container traffic growth rates will dramatically drop. The prerequisites for further growth will include lower freight rates, investments in the debottlenecking of the transport and logistics infrastructure (the construction of additional railways, the electrification of railway sections, the upgrade and modernisation of locomotive fleets, the use of special rolling stock, and the construction of transport and logistics centres and infrastructure at border crossings, among other things), and international coordination of transport policies at the level of Greater Eurasia.

In an optimistic scenario, the aggregate container traffic along the China – EAEU – EU axis may grow to 1.3 million TEU in the long term. If the current gap (2:1) between the East-West/West-East container traffic remains, and those running from the West to the East are additionally loaded with any containerisable cargoes, the aggregate railway container traffic on the China – EAEU – EU axis may reach some 2 million TEU per year in the future.

The involvement with China’s BRI is of strategic importance to the EAEU countries. The main tasks here are to solve domestic problems of the transport and logistics infrastructure, advance containerisation of the economies, and standardise technical regulations. This will boost interregional freight traffic, enhance connections between the regions and improve the logistics position of the landlocked regions – Russia’s Urals and Siberia and entire Central Asia.

These and other applied findings and analysis are presented in the report titled Silk Road Transport Corridors: Assessment of Trans-EAEU Freight Traffic Growth Potential.

However, there are issues that may affect the further growth of trans-Eurasian transits. One of the most significant barriers that hinder the growth of container traffic on the China – EAEU – EU axis is the insufficient capacity of Polish railways and border crossings at Poland–Belarus border. The next report by the Centre for Integration Studies to be published on 10 May 2018 will discuss weaknesses and infrastructure bottlenecks in container traffic.

Additional Information

The Eurasian Development Bank (EDB) is an international financial institution founded by Russia and Kazakhstan in January 2006 with the mission to facilitate the development of market economies, sustainable economic growth, and the expansion of mutual trade and other economic ties in its member states. The EDB's charter capital totals US $7 billion. The member states of the Bank are the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic, the Russian Federation, and the Republic of Tajikistan.

The EDB Centre for Integration Studies is a specialist research centre of the Eurasian Development Bank. The Centre organises research and prepares reports and recommendations on regional economic integration. It has published over 49 public reports over seven years of its operation. Read more about the Centre's projects and publications at


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