The Crimean bridge: how to deal with it?
The impact that the newly built Crimean Bridge is going to have on Russia can hardly be exaggerated. No wonder its grand opening was such a queer: Vladimir Putin crossed the bridge driving a Kamaz.
Yet, in addition to the vehicles, the repercussions it carries for Ukraine can hardly be overemphasized.
Until we have information on the calculation methods used by the Ministry of Infrastructure of Ukraine, their ₴500 million of annual projected losses seems to be a very rough estimate. As you may recall the bottom of all problems is the height of the Kerch Bridge, which allows to pass ships not higher than 33 meters. The Mariupol Sea Port, the largest on the Azov Sea, could accommodate vessels with the sail height of up to 44 meters. It is difficult to estimate the share of such high vessels in the cargo turnover and whether we actually have need in those. According to the data of the Mariupol Sea Port, the Kerch-Yenikale canal cannot accommodate 144 vessels that the port used to work with.
On the other hand, the biggest losses the Mariupol Sea Port is going to incur will not stem out of the military conflict in the Eastern Ukraine and the resultant confinement of transport connection with uncontrolled territories. For the port, steel products always remained the main commodity. In 2007, it accommodated over 8.5 million metric tons of cast iron and steel products alone. The port had shipments from all metallurgical plants of the region (Illich Steel and Iron Works, Azovstal, Yenakiyeve Iron and Steel Works, Makiivka Metallurgical Plant, Alchevsk Metallurgical Plant, Donetskstal Iron and Steel Works). Today, the Mariupol Sea Port focuses on products from the Illich Steel and Iron Works and Azovstal. These shipments make only half of the older volumes being around 4.5 million metric tons a year. Other shipments such as coal, coke, and clay have generated losses as well. Many coal mines are located in the uncontrolled parts of Luhansk and Donetsk regions, and there is no direct rail communication with the Northern part of Donbas (where the clay is extracted and Europe’s largest Avdiivka Coke Plant is located) that would by-pass Donetsk. In total, the turnover of steel and other types of cargo shipped to the Mariupol Sea Port declined from 15 to 7 million metric tons (according to the port).
What can be done?
After the Crimean Bridge, the South-East Asia direction, where the cargo ships with a high above-water portion used to set sails, became of a crucial importance (according to the Mariupol Sea Port). Nearly 1.5 million metric tons of iron and steel came this way, that is, about 20% of the current cargo turnover.
Before the bridge, however, transcontinental vessels were loaded in Mariupol hardly to the fullest. They then docked at Black Sear ports (Yuzhnyi Sea Port, Port of Chernomorsk, Port of Odesa), where they loaded the remaining space with products from the Dnieper Metallurgical Combine and ArcelorMittal.
For that reason, the most obvious way to offset losses from the Crimean bridge is the further development of railway communications between Mariupol and the mainland (namely, increasing the handling capacity of the railway junction at Kamysh-Zoria that accommodates railway trains coming from the Mariupol railway hub). Such actions can solve two problems at once. On one hand, it will allow Mariupol steelworks to ship some of the steel products to Black Sea ports. On the other hand, it will allow the Mariupol port to offset turnover losses by increasing the shipments of agricultural and other types of products from all over Ukraine, which would not require large-capacity vessels.
Not to mention the economic and military benefits such a railroad communication can bring.
As to the cons, they are mainly geopolitical
Unfortunately, the main losses Ukraine incurs have a geopolitical rather than economic nature.
- Russia has once again confirmed the seriousness of intentions about Crimea showing that it is in dead earnest and for a long time, and that international courts or hopes for the issue to somehow resolve by itself cannot scare Moscow off.
- The Sea of Azov now becomes a lake, and even before the bridge was built, Russia had had resources to close the Kerch Strait for Azov ports in Ukraine.
- Ukraine has almost completely lost any levers to influence Crimea since Russia does not need a land corridor to the annexed enclave anymore, nor has any interest in its stability. As, for example, in autumn-winter, when the ferry connection becomes unstable.
- The important part is that Russia has fewer deterrents against a more aggressive policy towards Ukraine. And after the gas pipelines around Ukraine to Europe hit their designed capacity (especially, Nord Stream 2), Russia’s interest in the existence of Ukraine will diminish even further.
For that reason, new challenges require Ukrainian elites to have better diligence and concentrate resources in the right direction – particularly, on infrastructure projects. Alas, time is not on our side.
Source: Novoe Vremya.Business
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