Kim Jong Kwan, Vice-President of KITA: “Zarubino attracts us but we are cooled down by poor infrastructure and sluggish customs”
Prospects of Russia-Korea investment cooperation at port Zarubino has been recently discussed at the meeting of the regional authorities and the business representatives of the Republic of Korea. Kim Jong Kwan, Vice-President of the Korea International Trade Association (KITA) who headed the delegation, tells IAA PortNews about the interest of Russia’s neighbors in Zarubino project.
- KITA reportedly numbers 70,000 member companies. Why is the business of Korea interested in Zarubino project? What do you think about economic and geopolitical advantages of the port against other ports of the Far East? What are its major disadvantages?
- The advantages of Zarubino are evident. It is close to port Rajin, special economic zone Rajin-Sonbong and Hunchun of China. Therefore, Zarubino is expected to play a leading role in the three-party trade between the Republic of Korea, the Russian Federation and China. We hope there will be an opportunity to create a network for multimodal transportation. After linking Russian and Korean transport corridors TSR and TKR.
As for disadvantages, they include poor infrastructure, inefficient system of container transportation by Transsib and Zarubino-Hunchun routes an low capacity of customs (30 trucks per day), where transit cars wait in a line for a long time while the construction of the new building is suspended.
- As it is known, Summa Group with the participation of its Chinese partners, is going to build a complex for transshipment of different cargoes, up to 100 mln t in capacity. Which segment of Big Port Zarubino project is interesting for the Korean business? Which terminal is in the focus of Korean companies?
- We are interested in grain and container terminals. Korean businesses willing to participate include Daewoo International, Posco P&S, LS Networks and Hyundai.
- What are the terms and the scope of their possible participation in the project?
- There is no proposal for participation in Big Port Zarubino project. The essential prerequisites include a required infrastructure (highways and railways), then EDI system should be up and running. Simplification of customs procedures and reduction of duties are also required for cooperation.
- What economic effect from participation in Zarubino project do the Korean analysts forecast?
- We hope that the alteration of the logistic chain when shifted to Zarubino– Donghae route will let facilitate cargo transportation and increase traffic as compared with the current turnover running via Dalian to port Incheon. This will, in its turn, boost exports from Korea to Russia.
- You said that Russia-Korea trade turnover has surged 129 times from 2002 to $25.8 bln. The share of the Primorsk Territory in vis figure is just several percents. How is the situation going to change with the implementation of Zarubino project?
- We expect the turnover of containers increase to 500,000 TEUs by 2018, other cargoes – to over 10 mln t. With such a trend, annual trade turnover of 1.22 mln t is to exceed 100 mln t per year by 2030 with Zarubino port turning into a logistic center of the Asia-Pacific Region.
Interviewed by Yevgeny Pankratyev.
IAA PortNews acknowledges the Consulate General of the Republic of Korea for assistance in organization of the interview.
Photo contributed by the press center of the Primorsk Territory Authority.