Radio Free Europe, Czech Rep.
Jan 10 2005

Russia/Georgia: Opening Of Ferry Link Expected To Impact Regional
Trade

By Jean-Christophe Peuch

Russia and Georgia were expected to sign an agreement today on
opening a direct railway ferry between the Black Sea ports of Poti
and Kavkaz. Direct railway connections between the two countries have
been halted since 1992 amid a dispute over the secessionist region of
Abkhazia. The Poti-Kavkaz ferry is not only important for Russia and
Georgia. Armenia, Azerbaijan and Central Asian countries are expected
to benefit from the new link.

Prague, 10 January 2005 (RFE/RL) — Addressing reporters upon his
arrival in Tbilisi early today, Russian Transportation Minister Igor
Levitin said he would sign three documents during his two-day visit
to the Georgian capital.

“We will today sign three documents — an agreement on the ferry
crossing, a regulation covering the transport of goods, and a
temporary exploitation regulation. This temporary regulation will be
effective until all countries that take part in the railway
transportation [process] meet in February,” Levitin said.

The ferry connection stretches between the Georgian port of Poti and
Russia’s industrial terminal of Kavkaz. Georgian Economic Development
Minister Aleksi Aleksishvili said today the line would officially
come into service in 10 days.

Kavkaz is a main export outlet for crude oil, oil products, and
fertilizers. Its location on the Kerch Strait that links the Black
Sea to the Sea of Azov makes it a major hub for goods meant to
countries of the Mediterranean Sea basin. Russia sees the Poti-Kavkaz
agreement as part of a long-term, larger project to resume railway
transportation throughout the South Caucasus region.

The agreement to be signed today will give a major impetus to direct
Russian-Georgian trade. It is also expected to boost transit of goods
from Armenia, Azerbaijan, and Central Asian countries — in
particular Kazakhstan and Turkmenistan, which trade with Russia
through the Caucasus region.

Armenian Transportation Minister Andranik Manukian, who is also in
Tbilisi, said yesterday that his country expects direct economic
benefit from the Poti-Kavkaz ferry link. “Economically, it is very
profitable,” he said. “This link is very short. Today we are using
the [Ukrainian] port of Illichivsk, [south of Odesa]. But, the
distance between Illichivsk and Poti is very long. [By contrast], the
distance between Kavkaz and Poti is very short. Secondly, Armenia,
Georgia, and Azerbaijan will now have a direct link with Russia.”

In a phone interview with RFE/RL’s Armenian Service today, Manukian
elaborated further on the impact Yerevan expects from the
Russian-Georgian deal. “It will reduce by 30 percent the costs of
transportation [of Armenian goods],” he said. “In addition, it will
de facto establish a direct link with Russia and, consequently, help
increase the volume of trade with Russia and other CIS countries.”

Russia sees the Poti-Kavkaz agreement as part of a long-term, larger
project to resume railway transportation throughout the South
Caucasus region.

Russian Transportation Minister Levitin unveiled the plan in late
November during a tour of the South Caucasus capitals. Addressing
journalists in Tbilisi after signing a memorandum with the Georgian
government, Levitin said the project will revive a major north-south
railway corridor that has been idle since the 1992-93 war in
Georgia’s separatist republic of Abkhazia.

“Prior to my visit to Georgia I was in Armenia and Azerbaijan, where
I received the support of my colleagues transportation ministers, as
well as that of the presidents. I am happy to announce that Georgia
equally supports the idea of having a trans-regional railway
connection. [The Georgians] believe renovating the former
Transcaucasus railway link will seriously help revive long distance
traffic across our [respective] countries. I am really happy to say
that we have reached a mutual understanding with Georgia,” Levitin
said.

Plans to revive overland traffic between eastern Turkey and southern
Russia through Georgia and Abkhazia have been thwarted by the
unsettled separatist conflict. For more than a decade, Tbilisi has
been insisting that all ethnic Georgians who have been displaced by
the 1992-93 war be allowed to return to Abkhazia before any deal is
signed.

Georgian Economic Development Minister Aleksishvili said today that
no agreement has been reached yet. “No concrete decision is expected
[soon],” he said. “We must still assess the technical feasibility of
the project and there is also a political aspect to that issue.
Consequently, we do not expect any breakthrough.”

Levitin said today that although no substantial progress had been
noted recently, the reopening of a direct railway link between
Georgia and Abkhazia was still on the agenda. “In the memorandum we
signed [with Georgia] on 1 November, there were two issues,” he said.
“One was the opening of a ferry connection, which we will be signing
today. The second was the resumption of through traffic. We’re still
examining the railway section that links [the Abkhaz capital] Sukhum
to the [Georgian-Abkhaz] border on the Inguri River, where there is
no bridge.”

Levitin said he would discuss the possible reopening of the
Sukhum-Tbilisi railway link with Georgian Prime Minister Zurab
Zhvania and State Minister Kakha Bendukidze later today.

Tomorrow Levitin will visit Poti to symbolically inaugurate the ferry
line with Kavkaz.

(RFE/RL Armenian Service correspondent Ruzanna Stepanian contributed
to this report)