Geographic focus: Republic of Armenia, Azerbaijan Republic, Georgia, Republic of Kazakhstan, Kyrghyz Republic, Republic of Tajikistan, Turkmenistan, Republic of Uzbekistan

Project Budget : EURO 1,500,000

Contract awarded to : SISIE

Implementation timetable : July 1996 through February 1998

Background and Objectives. Rail cost accounting systems inherited from the FSU (e.g. the MTT system for transit traffic) are based on data, aggregation and indexing which are not fit to support sensible commercial decisions.

The objectives of this project were : (i) to encourage trade development through tariff and timetable co-ordination between the various railways of the TRACECA Region; specific objectives are to encourage commercial, competitive attitudes to rail business development ; (ii) to encourage the development of rail tariff co-ordination, to establish common mechanisms for the collection and transfer of transit traffic revenues ; and (iii) to eliminate tariff discrimination throughout the Region and to assist in the co-ordination of maritime tariffs and timetables, for traffic using the ports of Baku, Turkmenbashi and Aktau.

Key Issues and Achievements. The project was given three themes : co-ordination of operations, tariffs, costing and marketing. These include a revenue sharing policy between the railways, a cost accounting policy and applications for cross-border and joint operations, developing a marketing plan and refining commercial attitudes. There is advantage seen in emulating and collaborating with the European Bureau Central de Compensation, a European rail payments clearing house.

This project was fundamental for rail commercialisation and restructuring to assist them to develop their businesses and compete against rival modes and alternative routes. The project’s outputs were used by the TRACECA Railways Restructuring projects, which served as a basis for EBRD loans to the Governments of Georgia, Azerbaijan, Kazakhstan and Uzbekistan, and for an ADB loan to Uzbekistan. A proposal to establish a "Common Operator" for the TRACECA region, including the Black Sea is gaining momentum and to date seven TRACECA participating states are evaluating the scheme which could be based on the European "Intercontainer" model, with the prospect of a future partnership and operational links. Training seminars in a specialised railway cost management software called "SYSMANAGEMENT" were held.