Baku-Tbilisi-Kars Not to Replace Oil Revenues - Natig Jafarli
2017 October 30 ( Monday ) 13:21:13
Baku / 30.10.17 / Turan: Azerbaijan as a financial sponsor of the Baku-Tbilisi-Kars (BTK) railway will receive additional political dividends from the project and increase its political weight, the economist Natig Jafarli said.
On his profile in the social network Facebook, the expert noted the positive nature of the project in terms of additional links with the West. According to him, this project will also be an additional factor in strengthening relations with Georgia, which is a window to Europe. The project will also serve to increase the turnover with Turkey.
Touching upon the profitability of the project, Jafarli noted it is not attractive to international financial institutions and because of this Azerbaijan became the main construction donor, providing Georgia with an interest-free loan of $ 1 billion for 20 years.
"At first, the annual revenues from the project will not exceed 20-30 million dollars. Despite the fact that the project will be important from the point of view of regional cargo transportation, the realization of international cargo transportation through our country will be more difficult. Attractiveness should be ensured by rapid transportation from Beijing to London, but there are two obstacles: cargo must be transported across the Caspian by ferry, during which there may be difficulties due to weather conditions, as well as the presence of different railroad gauge between post-Soviet and European countries," Jafarli considers.
In his opinion, in order to compete with the already existing route China-Kazakhstan-Russia-Europe, it is necessary to pursue a policy of cheaper tariffs, which in turn is problematic.
"BTK will not bring financial dividends for many years and the return of funds should be expected in 25-30 years. If the government hopes that this project will somehow replace oil revenues, it is mistaken then," Jafarli said. -71D-