Fourth Interim Progress Report ENG final · Freight Forwarders, NGOs, Transport users at large Specific activities: The Project has four work components: (1) Implementation support

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TRT TRASPORTI E TERRITORIO SRL

EuropeAid 2008/155-683

Transport dialogue and interoperability between the EU and its neighbouring countries and Central Asian countries

Fourth Interim Progress Report

June 2011

This project is implemented by TRT Trasporti e Territorio

in association with Alfen Consult GmbH, Dornier Consulting GmbH and PTV AG

TRACECA IDEA Project - Contract 2008/155-683

This project is funded by the European Union

Transport Dialogue and Interoperability between the EU and its neighbouring Countries and Central Asian Countries

TRT Trasporti e Territorio in association with: Alfen Consult, Dornier Consulting, PTV

Fourth Interim Progress Report, June 2011 2/113

REPORT COVER PAGE

Project Title : Transport dialogue and interoperability between the EU and its neighbouring countries and Central Asian countries

Short Name : IDEA (Transport Interoperability and Dialogue between the EU, Caucasus and Asian)

Project Number : EuropeAid 2008 / 155-683

Countries : Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Uzbekistan and Ukraine. Bulgaria, Romania and Turkey associated to the project as TRACECA member

Contractor

Name : TRT Trasporti e Territorio & Consortium Partners

Address : Via Rutilia, 10/8 20141 Milano, Italy

Tel. Number : +39-02-57410380

Fax number : +39-02-55212845

E-mail : [email protected]

Contact person : Mr. Angelo Martino / Project Coordinator

Signatures :

Date of report : June 2011

Reporting period : 12 November 2010 – 11 May 2011

Author of report : Dr. Udo Witulski / IDEA Team Leader

The IDEA team established the Project office within the TRACECA Permanent Secretariat building in 8/2, T. Aliyarbekov Street, Baku, AZ1005 Azerbaijan. Central telephone and fax numbers are +994-12-5982718 respectively +994-12-4986426.

Contacts of the permanent project team in Baku are as follows:

Position Name Email & Cell phone

Team Leader & Key Expert I

Dr. Udo Witulski [email protected]

+994 - (0)50 – 646 3524

Key Expert II Dr. Ashraf Hamed [email protected]

+380919 45 25 66

Key Expert III Mr. Detlef Pulsack [email protected]

+994 - (0)50 – 646 3526






Distribution List

Entity/Project Partner Russian Copy

English Copy

Electronic Copy on CD (English & Russian)

Signature/Receipt

1. EC Project Manager Brussels - 2 1

2. TRACECA National Secretary Ukraine 1 1 1

3. TRACECA National Secretary Moldova 1 1 1

4. TRACECA National Secretary Romania 1 1 1

5. TRACECA National Secretary Bulgaria 1 1 1

6. TRACECA National Secretary Kazakhstan 1 1 1

7. TRACECA National Secretary Tajikistan 1 1 1

8. TRACECA National Secretary Uzbekistan 1 1 1

9. TRACECA National Secretary Kyrgyzstan 1 1 1

10. TRACECA Nat. Secretary Turkmenistan 1 1 1

11. TRACECA National Secretary Turkey 1 1 1

12. TRACECA National Secretary Georgia 1 1 1

13. TRACECA National Secretary Armenia 1 1 1

14. TRACECA National Secretary Azerbaijan 1 1 1

15. EC Delegation Turkey 1 1 1

16. EC Delegation Ukraine 1 1 1

17. EC Delegation Moldova 1 1 1

18. EC Delegation Kazakhstan 4 4 1

19. EC Delegation Kyrgyzstan 1 1 1

20. EC Delegation Georgia 1 1 1

21. EC Delegation Armenia 1 1 1

22. EC Delegation Azerbaijan 1 1 1

23. TRACECA Permanent Secretariat, Baku 2 2 1

24. EU Monitoring Program (Regional Office) 2 2 1






Table of Contents

REPORT COVER PAGE ........................................................................................................ 2

Distribution List ....................................................................................................................... 3

List of Abbreviations ............................................................................................................... 6

PROJECT SYNOPSIS ........................................................................................................... 7

1. Summary on Past and Upcoming Reporting Period .................................................... 9

1.1 Status of the Project at time of reporting ................................................................... 9

1.2 Work efforts during past reporting period ................................................................ 11

1.3 Work plan for next reporting period ........................................................................ 11

2. Key Result 1: Strengthen Political and Transport Dialogue Mechanisms ................ 13

2.1 TRACECA website ................................................................................................. 13

2.2 Updated TRACECA Map ........................................................................................ 14

3. Key Result 2: Support the Implementation of the IGC Long-Term Strategy until 2015 and related Action Plans ............................................................................. 16

3.1 TRACECA routes attractiveness index (TRAX) ...................................................... 16

3.2 Harmonisation of transport regulations & approximation of national policies ........... 17

3.3 TRACECA traffic model, GIS web application and TRACECA databases .............. 18

3.4 Training programme ............................................................................................... 21

4. Key Result 3: Identification, Prioritisation and Presentation of TRACECA Transport-Infrastructure Project Proposals ......................................... 24

4.1 Stakeholder dialogue for project appraisal and training requirements ..................... 24

4.2 Second Projects Prioritisation round ....................................................................... 25

4.3 Evaluation of prioritised projects ............................................................................. 27

4.4 Investment manual ................................................................................................. 27

4.5 TRACECA Investment Forum ................................................................................. 28

5. Annexes to the Progress Report ................................................................................. 30






Table of Annexes

Annex 1: Updated Logical Framework Matrix ................................................................... 31

Annex 2: IDEA Missions ................................................................................................... 34

Annex 3: Monitoring and Evaluation Plan of past Reporting Period .................................... 35

Annex 4: Annual Work Plan for next Reporting Period ...................................................... 36

Annex 5: Annual Resource Schedule and Budget for next Period .................................... 37

Annex 6: TRACECA Technical Meeting on Traffic Forecast Model and On-Line GIS Database ........................................................................................................... 38

Annex 7: Questionnaire on further enhancements of TRACECA GIS Web Application and GIS Database ............................................................................................. 42

Annex 8: TRACECA Transport Forecast and Investments Impact Assessment Training .. 46

Annex 9: TRACECA Investment Appraisal Training .......................................................... 48

Annex 10: TRACECA Transport Infrastructure Projects presented and evaluated during Second Prioritisation Cycle ..................................................................... 52

Annex 11: Working Papers ................................................................................................. 54






List of Abbreviations

ADB Asian Development Bank BAC Business Advisory Council BDZ Bulgarian State Railways BSEC Organization of the Black Sea Economic Cooperation CALC International Logistics Centres in Central Asia project CAREC Central Asia Regional Economic Cooperation CIS Commonwealth of Independent States (former USSR) also called NIS DevCo DG MOVE

EuropeAid Development Co-operation Office Directorate General Transport

EaP Eastern Partnership EBRD European Bank for Reconstruction and Development EC European Commission EIB European Investment Bank ENP European Neighbourhood Policy EU European Union FRISBEE Finland, Sweden, northern parts of Russia GIS Geographical Information System IBRD International Bank for Reconstruction and Development (World Bank) IDEA Interoperability and Dialogue between Europe and Asia IFC International Financing Corporation IFI International Financing Institution IGC (TRACECA) Inter-Governmental Commission ILC International Logistics Centre IRU International Road Transport Union LCPI Logistics Chain Performance Index MEDA EU-Mediterranean Partnership MLA Multi-Lateral Agreement MoT(C) Ministry of Transport (and Communication) MoU Memorandum of Understanding MoS Motorways of the Sea NGO Non-Governmental Organisation NIS Newly Independent States, also called CIS NS (TRACECA) National Secretary OSCE Organization for Security and Co-operation in Europe PPP Public-Private Partnership PS (TRACECA) Permanent Secretariat PSD Private sector development RELEX Relations Extérieurs (EC DG Foreign Relations) SG Secretary General TACIS Technical Assistance for the Commonwealth of Independent States TEN-T Trans-European Transport Network TIF TRACECA Investment Forum ToR/TOR Terms of Reference (of the present project, unless stated otherwise) TRACECA Transport Corridor Europe-Caucasus-Asia TRAX TRACECA Routes Attractiveness Index UNDP United Nations Development Program WB World Bank WG Working Group WTLC International Logistics Centres in Western NIS and the Caucasus






PROJECT SYNOPSIS Overall objectives: The overall objective of TRACECA is to improve the transport links of the EU Trans-European Networks with the neighbouring countries (Caucasus, including Armenia, Azerbaijan, Ukraine and Georgia) and the Central Asian countries, thus facilitating trade and enabling socio-economic and environment development in the region. Additionally the Project’s purpose is to enhance regional transport dialogue and transport inter-modality between the EU and these countries through enhanced co-ordination and working with international financing institutions (IFIs), closer collaboration and participation of IFIs and, where feasible, the private sector in TRACECA transport projects.

Results to be achieved, indicators, constraints and assumptions are laid out in Annex 1: Project Logical Framework Matrix.

Specific Project purposes are as follows:

1. Strengthen the political and transport dialogue mechanisms between the European Commission (EC), TRACECA beneficiary countries, other project stakeholders and IFIs, by achieving effective communication and dissemination of activities and results for the TRACECA programme.

2. Support the implementation of the IGC Long-Term Strategy until 2015 and related Action Plans, through assistance to TRACECA Permanent Secretariat and member countries for development of the transport corridor and links to the EU Trans-European Networks, by achieving effective and sustainable coordination with IFIs and other financial institutions for identification of “bankable TRACECA originated projects”.

3. Contribute to the development and agreement of TRACECA regional investment plans for transport infrastructure in support of project identification, project definition and appraisal leading to mobilisation of funding and project implementation, by supporting the implementation of transport investments' projects by providing studies, developing business and master plans, analysing financial and technical feasibility including public-private partnerships.

Project starting date: 12 May 2009

Project duration: Three years (36 months)

Project value: Total value of the Project is Euro seven (7) million, of which provisions for staffing and related expenditures is Euro five (5) million and for incidental expenditure Euro two (2) million

Key stakeholders: Ministries of Transport, Ministries of Trade & Economy, Customs Authorities, IFIs, Commercial Banks, International Road Carriers, Freight Forwarders, NGOs, Transport users at large

Specific activities: The Project has four work components: (1) Implementation support for IGC Long-Term Strategy and related

Action Plans including capacity and institutional building; (2) Project identification and project definition; (3) Mobilisation of funding; and (4) Communication and dissemination.

Key Results:

I. Strengthen the political and transport dialogue mechanisms:

1. Coordinated strategy between countries to strengthen regional transport cooperation;

2. Changes to the governance and organisation structure of the TRACECA Permanent Secretariat (PS) will have been agreed and implemented together with proposed amended funding mechanisms;

3. A minimum of two regional transport and infrastructure conferences will have been held at ministerial level;

4. Thematic working-group structures will be established and working; a minimum of eight working groups will have been convened;






5. TRACECA programme activities, marketing materials, results and other information will have been produced and widely communicated and disseminated; main dissemination media is assumed to be the web-page.

II. Support the implementation of the IGC Long-Term Strategy until 2015 and related Action Plans:

1. Specific objectives, targets and activities within the IGC Long-Term Strategy will be identified, and monitoring tool will be rolled out;

2. Specific actions required by Action Plan 2008-2009 will be followed up, and input for Action Plan 2010-2012 will be defined;

3. A minimum of two IFI regional coordination meetings (TRACECA Investment Forums) will have been convened;

4. A high-quality and successful training, including a “Train the Trainers”, programme will be established;

5. The IGC Permanent Secretariat and National Secretaries (NSs) will have received capacity building for public-private infrastructure procurement, project management and finance, and structured training programmes to meet their specific needs;

6. An established “working community” will be in place comprising TRACECA network and IFIs.

III. Identify, prioritise and present TRACECA transport-infrastructure project proposals:

1. Sustainable TRACECA’s transport and project database pipeline database system for screening, selection and evaluation of potential TRACECA projects will be maintained and updated by the TRACECA member countries themselves;

2. Financing and investment manual as part of a “TRACECA Tool Kit” (including transport model, GIS, appraisal tool and IFI application tool) will be elaborated for operational use and awareness training by PS and member countries;

3. Sustainability of TRACECA’s transport and traffic database system will be ensured;

4. Short list of infrastructure and transport projects will be established meeting the criteria of a TRACECA regional project; support of preparation of TRACECA priority projects documentation will be in line with IFI standards

5. At least two bankable TRACECA originated projects will have IFI commitments for investment and/or co-financing;

6. Documented methodology for project identification and project definition will be in place for use by the PS covering the project cycle,

7. TRACECA Investment Forums will be convened; effective interfaces and working relationships will be built with the IGC TRACECA and PS.

Preparation of this Fourth Interim Progress Report: The report was prepared by the IDEA Project's key experts and representatives of its Consortium Members: TRT Trasporti e Territorio srl, Alfen Consult GmbH, Dornier Consulting GmbH and PTV AG.

Purpose of the Report: The purpose of this Fourth Interim Progress Report is to:

(1) present a concise summary of the main issues of the IDEA Project and recommendations of the IDEA-staff for the attention of key decision makers;

(2) review the activities undertaken by the Project during the fourth reporting period; and

(3) give a precise outlook on the contents, procedures and schedules of the work planned for the next reporting period of six months.

Format of the Report: This Interim Progress Report follows the format proposed by the EC guidelines.






1. Summary on past and upcoming Reporting Period

During the past reporting period (12 November 2010 – 11 May 2011), the IDEA Project had concentrated mainly on the

• preparation and conduct of the second evaluation and prioritisation cycle of TRACECA project proposals;

• design of training courses on traffic modelling and project appraisal;

• detailing of the traffic model; and

• preparation of the TRAX rail and multimodal segments.

This chapter gives a description of the progress towards achieving the project objectives and measures the weight which the experts put onto the various project components in terms of time input.

1.1 Status of the Project at time of reporting

Table 1 on the following page depicts the progress towards achieving the objectives as laid out by the Project’s Terms of Reference (ToR). This progress is measured in terms of activities which (1) were undertaken during the past four reporting periods, (2) are planned for the next (fifth) reporting month period, or (3) are projected to be undertaken during the last (sixth) reporting period of the Project duration.

This Progress Report measures the progress towards achieving the Project’s objectives in terms of work input undertaken or projected in rough percentages. These percentages are estimates because progress in ‘soft’ activities, such as policy dialogue, can hardly be measured by hand of ‘hard’ figures. Over the entire Project period, the IDEA-team assumes all activities to be completed. Hence every input (every row of the graphic) sums up to a hundred per cent.

The table indicates that work on Key Result 3: Development of Transport Infrastructure has progressed most, based on the concluded activities in prioritisation of transport-infrastructure projects. Particularly, the objectives of

• at least two bankable TRACECA originated projects with committed IFI investment funds and/or co-financing,

• ensured sustainability of TRACECA’s transport and traffic database system,

• short list of infrastructure and transport projects meeting the criteria of a TRACECA regional project, and

• ”TRACECA Tool Kit” with Investment Manual for operational use and awareness training by PS and member countries,

have been almost entirely achieved.

In contrast, most work on Key Result 1: Political and Transport Dialogue and Key Result 2: Support to Implementation of IGC Long-Term Strategy is performed independently as a permanent process. Activities on following objectives have progressed most:

• Re-balancing within the TRACECA Long Term Strategy to 2015 and roll out of monitoring tool,

• Specific actions required by Action Plan 2008-2009 and definition of input for Action Plan 2010-2012, and

• “Working community” comprising TRACECA network and IFIs with dedicated coordinators.

Other activities, particularly training sessions on traffic modelling and project-appraisal procedures, will be conducted during the fifth reporting period.






Table 1: Past and envisaged progress towards achieving objectives (in terms of work input)

No. Specific Objective

Activities

Previous periods

Fourth period

Fifth period

Sixth period

Objectives in relation to Key Result 1: Political and Transport Dialogue

1 Coordinated strategy in place and working between countries to strengthen regional transport cooperation 50 < 20 < 20 < 20

2 Changes to PS governance and organisation structure together with proposed amended funding mechanisms 50 < 20 < 20 < 20

3 At least two tegional transport and infrastructure conferences at Ministerial level 50 25 25

4 Thematic working group structure working, minimum of eight working groups to be convened 50 < 20 < 20 < 20

5 TRACECA programme activities, materials, results and other information produced and widely disseminated 50 < 20 < 20 < 20

Objectives in relation to Key Result 2: Support to Implementation of IGC Long-Term Strategy

1 Re-balancing within the TRACECA Long Term Strategy to 2015 and roll out of monitoring tool 75 25

2 Specific actions required by Action Plan 2008-2009 and definition of input for Action Plan 2010-2012 75 25

3 Minimum of two regional coordination meetings (TRACECA Investment Forums) for participation by IFIs 50 50

4 High quality and successful training programme, including a “Train the Trainers”, programme 25 50 25

5 Training programme for TRACECA NSs and PS in financing and best practices for promoting IFI and PPP investment 25 25 50

6 “Working community” comprising TRACECA network and IFIs with dedicated coordinators 75 < 20 < 20

Objectives in relation to Key Result 3: Development of Transport-Infrastructure Projects

1 Ensured sustainability of TRACECA’s transport and traffic database system 75 < 20 < 20 < 20

2 Project pipeline database for screening, selection and evaluation of potential TRACECA projects 50 < 20 < 20 < 20

3 Short list of infrastructure and transport projects meeting the criteria of a TRACECA regional project 75 < 20 < 20 < 20

4 Documented methodology for PS use covering project cycle for project identification and project definition 50 25 25

5 ”TRACECA Tool Kit” with Investment Manual for operational use and awareness training by PS and member countries 75 < 20 < 20

6 Support of preparation of TRACECA priority projects documentation in line with IFI standards 25 50 25

7 At least 2 bankable TRACECA originated projects with committed IFI investment funds and/or co-financing 100

8 TRACECA Investment Forums resulting in effective interfaces and working relationships with IGC TRACECA and PS 50 50

Up to 20% achieved

< 20 App. 25% achieved

25 App. 50% achieved

50 App. 75% achieved

75 100% achieved

100

Source: Consultant’s estimates






1.2 Work efforts during past reporting period

The following table shows that a total of almost 950 expert person-days were spent during the past fourth reporting period. These were concentrated on a few major activities:

• Junior (local) short-term experts’ work on Key Result 1: Political and Transport Dialogue was concentrated on finalising the TRACECA website.

• In Key Result 2: Support to Implementation of IGC Long-Term Strategy, the senior (international) short-term experts spent most of their working time on upgrading the TRACECA traffic model and the preparation of the training sessions, whereas junior (local) short-term experts’ inputs were concentrated on the TRAX.

• The IDEA key experts spent most of their time on Key Result 3: Development of Transport Infrastructure, particularly the preparation (through stakeholder dialogue missions) and conducts of the second cycle to prioritise TRACECA project proposals. Inputs of senior short-term experts were spent also on the analysis of the TIF 2010 priority projects documentation.

Table 2: Distribution of experts’ input during fourth reporting period (person-days)

Key Result Key Experts Senior Short-Term Experts Junior Short-Term Experts

1 38 16 31

2 63 217 200

3 169 111 71

Total 269 344 303

Note: Numbers exclude person-days for coordination, management and logistics

Source: Consultant’s calculations

During the fourth reporting period, the IDEA Project conducted a total of 17 missions (see Annex 2: IDEA Missions), mainly on stakeholder dialogue to prepare the second prioritisation cycle in Key Result 3: Development of Transport Infrastructure. A comparison of the two tables in the annex indicates that more than half of the meetings were undertaken within the TRACECA region, while most of the technical, such as progress, meetings were held in Brussels at the location of the European Commission.

Annex 3: Monitoring and Evaluation Plan depicts the distribution of the IDEA-team’s work input as to person-days of key and short-term experts during the past six-month period.

1.3 Work plan for next reporting period

Table 3 below shows the expected distribution of the experts’ total person-days over the Project’s key results during the fifth reporting period:

• The IDEA key experts together with senior short-term experts will work out a Communication and Dissemination Strategy under Key Result 1: Political and Transport Dialogue.

• Much of the key experts’ and senior short-term experts’ activities on Key Result 2: Support to Implementation of IGC Long-Term Strategy will be spent on improving competencies and knowledge of NS and PS experts in the fields of traffic modelling and project appraisal. Training activities in these tasks will be geared towards national experts similarly as to officials of the TRACECA member countries. Junior short-term experts will finalise their work on TRAX and on the GIS database.

• The work expected to be spent on Key Result 3: Development of Transport Infrastructure during the next reporting period is related to the preparation of the Transport Investment Forum (TIF) 2012. Enhancement of IFI coordination and






adoption of their methodologies in the appraisal approach of transport-infrastructure projects will be further activities of the IDEA experts.

Table 3: Experts’ input planned during fifth reporting period (person-days)

Key Result Key Experts Senior Short-Term Experts Junior Short-Term Experts

1 42 37 23

2 92 192 293

3 137 187 163

Total 270 415 480

Note: Numbers exclude person-days for administration, management and logistics

Source: Consultant’s calculations

More details on the activities can be found in Annex 4 Annual Work Plan for next Reporting period, which also gives an indication of the planned input as to person-days.

Annex 5: Annual Resource Schedule and Budget for next Period, describes the modified, spent and still available person-day budget in detail.






2. Key Result 1: Strengthen Political and Transport Dialogue Mechanisms

The tasks to achieve this key result have as objectives the (1) strengthening of the political and transport dialogue mechanisms between the EC, the TRACECA beneficiary countries and other stakeholders, and the (2) effective communication and dissemination of activities and results of the TRACECA programme.

2.1 TRACECA website

This website is the major tool to guarantee sustainability of the Project results and their ownership by the TRACECA countries, and also hosts the project database that is maintained by the countries. The projects are categorised into pipeline projects, investment opportunities and featured opportunities. The latter are the priority projects presented in the TRACECA Investment Forum.

The TRACECA website is now fully managed by the PS in Baku. The PS evidently needs training in creating news to reflect TRACECA activities and promote it to the transport industry.

Future Activities

Countries’ pages on the TRACECA website are still inhomogeneous, and the PS should consequently take initiative to force the TRACECA countries to improve their documentation. In particular, web content must be optimised for the transport industry as target audience, and maximum use has to be done of the EU supporting ENPI info service. A web-based prioritisation system is currently under discussion and will be implemented if required. The IDEA team proposes following activities:

• TRACECA countries should bring their websites to a rather homogeneous level, websites offering only scarce information should be made denser;

• Minimum content for all TRACECA country websites should be defined by the PS;

• TRACECA countries should add and optimize route and border-crossing information to their websites; and

• PS staff should receive training based on the EU communication training methodology, in order to design news on the website.

2.2 Updated TRACECA Map

The IDEA Project has developed / updated the TRACECA Map, the Freight Model and the GIS Database with the specific target to be integrated as much as possible. This integration requires having a GIS-based map. The network currently displayed in the updated map is mainly the network implemented within the Freight Model - this allows for a high coherence of information. The objectives of the updated TRACECA map are to

• represent infrastructures and corridors that are of relevance for the TRACECA project, and

• provide a tool that can be easily updated following the development of the TRACECA network.

Past Activities

The overview map (please see below Figure 1) was approved by the NSs in end-June 2010. Starting from the overview map, specific country maps were produced in order to be easily commented by the NSs and to be displayed on the TRACECA website. Adoption by the TRACECA officials of the TRACECA overview map and the specific country maps proved to be a complicated and lengthy process during the past reporting period.






A first round of revision took place between November 2010 and February 2011. Following its request, the Permanent Secretariat received comments from eight TRACECA countries. The IDEA Project subsequently adapted the TRACECA overview map and the specific country maps as much as workable, and explained the adaptations in a letter to the PS for onward distribution to the NSs.

A second round of revisions was requested by the PS between March and April 2011, as a result the PS received comments from four TRACECA countries. The PS deemed the maps of the countries that did not submit their comments to be approved.

In late April, the PS uploaded the updated TRACECA overview map and the specific country maps onto the TRACECA website.

Future Activities

The IDEA Project will incorporate the relevant modifications in the next TRACECA map update that is planned for mid summer, once that the revision of the TEN-T network will be completed by the European Commission's services and the Project has learnt of the new EC decisions regarding the TEN-T and the TRACECA Corridors, expected in July 20111. Activities will be completed by the end of July 2011 after adoption of the Commission’s communication.

1 The updated TRACECA country maps are now used by the EC TEN-TEC agency for the GIS support to the

revision of the TEN-T network extension to neighbouring countries.






Figure 1: Updated TRACECA Overview Map






3. Key Result 2: Support the Implementation of the IGC Long-Term Strategy until 2015 and related Action Plans

This bundle of tasks has as objective the support for implementation of the IGC Long-Term Strategy and related action plans. An effective and sustainable coordination with IFIs shall be achieved for identification of “bankable TRACECA originated projects” for funding by IFIs and with other financial institutions.

3.1 TRACECA routes attractiveness index (TRAX)

The IDEA Project developed an innovative methodology to measure the attractiveness of the TRACECA routes and to benchmark them with other competing routes. The ownership of the Index has been placed within the Modelling Experts Group.

Past Activities

A methodology document has been prepared in English and Russian and distributed to the experts’ group members. The methodology is considered as an accepted TRACECA mechanism to measure the route attractiveness and to compare this attractiveness with competing routes. This TRAX methodology is attached as Annex 11.1.

Future Activities

The road-based TRAX methodology will be extended to become multimodal. In this regard and during the course of 2011, TRAX will be further developed into the Intermodal Index TRAX by including the railway-born transport links along the TRACECA routes and the Trans-Russian routes.

For the intermodal index, a similar methodological approach for all its components will be applied, namely: road and rail transport indexes.

In analogy to road TRAX; the rail TRAX will be calculated to reflect the attractiveness indicators of a route chosen by a transport operator - particularly time, cost, reliability of transportation and safety. The weighing of these criteria must also reflect the priorities and weights considered by the transport operators.

Data collection, definition of criteria weights, formation and segmentation of the route will be made, in cooperation with transport companies and operators, by questionnaires and interviews based on actual cargo logs and documentations. An integrated approach is envisaged for data collection at the national and international level:

1) Questionnaire survey and interviews with some national railway administrations / companies - to provide national data for individual countries on route lines, tariff scales, costs of transportation on stretches and processing in the nodes, indicative time of the transportation through the route (stretch) and to carry out the necessary operations in the nodes.

2) Questionnaire survey and interviews with operators / companies / freight forwarders, providing services of rail transportation - to receive data at the national level for individual countries about time and cost of transportation by rail on a particular route (stretch/node).

3) Questionnaire survey and interviews with operators / companies / freight forwarders, providing services of international rail transportation - to receive data at the international level about time and cost of transportation by rail on a particular route (stretch/node) in terms of non-residents.

Further, the calculation of the reliability of railway transportation, average cost and time will be carried out in the same way as in the above-described methodology.






The selection and weighing of the criteria have been based on interviews with transportation operators in the TRACECA region and in Western Europe. The criteria meet the state-of-the-art experience in transport research.

The intermodal index TRAX will be calculated based on value (specific gravity) of road and rail traffic for each route.

3.2 Harmonisation of transport regulations & approximation of national policies

Major aim of the harmonisation of transport regulation is a comparison of the programme and progress made for the development of legal and regulatory convergence and harmonisation against European and international conventions.

The survey by the IDEA Project on international conventions and multi- and bilateral agreements in the TRACECA member countries concluded that

(a) the EU neighbouring countries have aligned their legal basis, implementation and enforcement mechanisms with EU standards, or at least they have taken concrete measures in such direction; and

(b) throughout the TRACECA region, know-how on the general concept and overall essence of the implications of transport-related legal and policy harmonisation is rather dispersed or even missing at all. In general, enactment and enforcement of transport legislation is relatively strong in Southeast Europe and becomes ever weaker towards the South Caucasus and Central Asia.

Past Activities

During the past reporting period, the IDEA team elaborated a working paper

• detailing the findings of the survey,

• identifying main constraints and conclusions, and

• recommending actions to be undertaken to provide support to implementation.

This working paper (please see Annex 11.2) addresses the legal framework in transportation, referring to:

• Technical standards for enhanced interoperability, safety and security in all modes of transport;

• Institutional standards mainly related to competition in the sector, i.e. unbundling of policy making, executive and operating functions in each TRACECA country;

• Non-physical barriers and standards in each TRACECA country and cross-border; and

• Attraction of additional investments, e.g. concession laws.

Major recommendation of the working paper is to establish permanent TRACECA expert groups under patronage of the PS covering the topics international conventions, multi- and bilateral agreements, and facilitation of border crossing.

Future Activities

Compared to the first TIF, the TIF 2012 is intended to focus more on ‘soft’ issues, therefore more general information reflecting the development within TRACECA will be offered. As the document is intended to be used as supporting information for the TIF 2012, IDEA will produce a summary for utilisation at this event. This paper will contain background information on transport legislation and border-crossing regulations.

Particular attention will additionally be given to the needs of cross-border projects in order to answer to those questions that might be posed by potential project developers.






TRAX will, among others, provide guidance towards most important actions in the field of legal and policy harmonisation. Advice as to border-crossing regulations and formalities will be given on the TRACECA website under the TRSSD (TRACECA Standardised Set of Documents) subdirectory. TRAX will, among others, provide guidance towards most important actions in the field of legal and policy harmonisation. IDEA short-term experts will therefore coordinate with TRAX the actions to be recommended.

3.3 TRACECA transport model, GIS web application and TRACECA databases

The TRACECA transport model has been developed as a strategic planning tool to calculate the volumes of transported goods considering both domestic flows and import / export / transit flows. It allows for assessing the impact of large-scale (trans-national) infrastructure measures in the TRACECA area (the working document describing the base-year model was already submitted in the previous reporting period).

Past Activities

TRACECA strategic transport forecast model: On 9 to 10 December 2010, an Experts Group Meeting was held in Brussels with the main focus on the development of the traffic forecast model and the GIS database. For agenda and conclusions of the meeting, please see Annex 6. At the end of the meeting, all countries received a VISUM license key, to work with the model as test for three months.

On the first day, freight transport model related workshop sessions were arranged with the modelling experts of the TRACECA countries. Besides the presentation of the forecast modelling approach, the main focus was put on an interactive work on the transport model with the participants.

The content of the workshops can be summarised as follows:

• Presentation of the status of the forecast model including − forecast modelling approach, network updates, socio-economic parameters, − resulting traffic flows and comparison with base-year results;

• Presentations by the TRACECA countries’ experts of national future networks and socio-economic scenarios;

• Hands-on working with the model (network changes, land use changes, methods of analysing model results);

• Handing over of the VISUM modelling software and the freight-transport model data to the participants.

As result of the modelling workshops of the Experts Group Meeting, the following conclusions can be drawn:

• Participants support the TRACECA freight model and expressed that the model is essential for TRACECA stakeholders and corridors;

• Agreement was reached that active cooperation is needed from side of the TRACECA countries in order to improve the base forecast with reference to planned infrastructures;

• Participants expressed their interest in model training, which has been recognised as essential step to make it possible that countries assume ownership of the model.

A revised draft of the TRACECA IDEA Freight Model Development Report has been delivered, including the following updates:

• Detailed description of the forecast modelling approach inclusive of the used forecast land-use data, forecast assumptions and infrastructure measures;






• Presentation of generated forecast demand and analysis of the assignment results with a comparison to the base-year model results.

After the Expert’s Group Meeting, several improvements regarding model functionality and handling for the user have been implemented.

The freight demand calculation consists of the following three major modelling steps:

1. Freight generation,

2. Freight distribution, and

3. Assignment including mode choice.

Initially, for the freight distribution the stand-alone version of the software VISEVA had been integrated in the model calculation script. However, this solution had limitations regarding the model application on computers with MS Office Suites 2007 and 2010. These limitations have been eliminated by substituting the VISEVA stand-alone version as distribution model. Instead, the VISUM internal distribution model is used for the distribution calculation. This improvement allows the full operation of the freight model regardless of which MS Office Suite is installed on the computer of the model user.

The control file provides the user interface and the script for running the freight model calculation steps. There are on-going improvements of the interface and the control file script to improve the usability of the freight traffic model. For example, the calculation of the impedance matrices is included in the control file script, which had to be executed separately before.

The land-use data file stores the base year and the forecast land-use data as input for the freight traffic calculations. There are on-going improvements of the data storage to improve the usability of the freight traffic model. Modifications of the countries’ population split into prosperity groups have been conducted in order to allow an easier forecast of the population development as basis for the forecast demand calculation.

GIS web application and GIS database: During the past reporting period, TRACECA received requests for data provision by the World Bank (WB). Following the open data policy of TRACECA, by implementing the agreements of the GIS Experts Meeting, TRACECA appreciated the WB request. Upon discussion with the WB contact person, the TRACECA team prepared and shared a data package of GIS layers to the WB for internal usage at the WB.

Deliverables consist in the following:

• Questionnaires in both English and Russian languages filled by the GIS Experts Group at the GIS Experts Group Meeting on December 10, 2010;

• Note on the evaluation of the questionnaire including conclusions for the IDEA team on how to best implement the proposed measures;

• Work description for IDEA IT expert for implementation of measures; and

• GIS data package for the World Bank.

Priority was given to present to, and discuss with, the GIS Experts Group the present application and database situation, and to ask the group for further enhancements and improvements. The new TRACECA GIS web application, as well as the migrated TRACECA GIS database, was presented to and discussed with the GIS Experts Group at the December meeting in Brussels. The actual state of the TRACECA GIS activities was presented at the said meeting, and potential future enhancements and improvements to the systems were proposed and explained. After discussion, questionnaires were handed out, and all present GIS experts from the TRACECA countries filled out the questionnaire. For contents and results of the questionnaire, see Annex 7. Results of the questionnaires were evaluated and ranked, and the necessary actions were triggered to implement the proposed improvements.






A working meeting was held with the IDEA IT expert in Baku in end-March 2011 to discuss the best options how to implement the proposed measures.

Future Activities

The further validation of the TRACECA transport model can only be made after the training. A questionnaire, distributed to the countries to obtain feedback on model specifics for calibration and validation, found very low response due to lack of knowledge how to use the model and despite the distributed VISUM licenses.

The use of the model by the TRACECA countries shall be supported by a series of training sessions on:

• compilation and inclusion of transport data tables,

• finalisation of metadata and embedment into new TRACECA website, and

• application of GIS web map.

This is a repetitive process with the countries and will be launched during the training and continued during the Modelling Experts’ Group information interchange. Regional meetings will take place periodically to create ownership and know-how transfer ensuring sustainability beyond the IDEA life cycle.

With reference to the TRACECA GIS web map application and the TRACECA GIS database, the next steps will entail the implementation of the measures as ranked by the GIS Experts Group. It is expected that complete implementation of these measures will only be finished by end of the IDEA Project, however, it is envisaged that interim results or part-results will already be implemented through the year 2011.

The GIS experts at the GIS Experts Group Meeting noted and agreed upon the following conclusions, upon presentation and discussion of the TRACECA GIS web application and the TRACECA GIS database:

• TRACECA GIS database shall be further developed to become the “one-stop-shop” for all transport-related data in the TRACECA framework. Any interested stakeholder, administrator or the public in general shall consult the TRACECA GIS web application for any transport information;

• GIS web application provides the technical basis for the “one-stop-shop”;

• information on infrastructure networks will have to be updated annually. Statistical data may be updated more often, as appropriate;

• PS will develop a special website, where registered users from the GIS Experts Group can announce any needs for updates of infrastructure-project data; the web form will enable the user to enter a short project description, and to upload any supporting maps or documents. The PS will forward this information to the relevant expert in charge for implementing these updates in VISUM;

• DG MOVE will provide WMS services of their database which, as soon as they are published, shall be included as new layer in the TRACECA GIS web application;

• IDEA team will prepare a paper on “Strategy on Database Updates and functional Improvements of the GIS Web Application” which will be distributed to the GIS Experts Group within the next four weeks for approval. Both Modelling and GIS Experts agree to keep the cycle of periodical meetings.

A rough estimation of deadlines for individual tasks of this work package is given in the following table:






Table 4: Tasks and timeframes

# Task Estimation time frame

1 Improvements GIS Web Application Jul-Aug 2011

2 GIS Database update strategy Aug 2011

3 Join VISUM results end of 2011

4 Geodata from other TRACECA projects IDEA project end in 2012

5 Improvements / follow up transport data end of 2011

3.4 Training programme

During the fifth reporting period, the IDEA Project will offer extensive training on transport modelling and project appraisal in the TRACECA countries.

The IDEA Project prepared a detailed plan (including concept, schedule, location, attendance, etc.) of the modelling training sessions:

• Duration will be one week, with sessions starting on Monday with the arrival of the participants and ending on Friday with the departure of the participants;

• Total number of six sessions is foreseen for transport modelling and four for project appraisal;

• Central locations are planned for the sessions to be conducted in to permit easy access for participants from other TRACECA countries;

• Total number of attendees is ideal between 10 to 15 participants per session;

• Training will be held in English with Russian translation, where necessary, its contents will be tailored and derived from the countries’ requirements;

• Train-the trainer concept: Deploying local tutors will ensure the understanding quality and close supervision for non-English speakers, the local trainers will receive a special training prior to the course start (if necessary);

• All training will focus on interactive work with TRACECA tools, additional training as continuing education will be available on an E-IDEA website platform; and

• A certificate of attendance will be issued to candidates who attended 100% of the course hours.

Training on Transport Modelling

Training sessions on transport modelling will cover the following topics:

• Introduction into transportation planning fundamentals;

• Using the VISUM Software, understanding VISUM and its basic functions;

• Working with the TRACECA model (updating input data / understanding results / adding new infrastructure / understanding VISUM outputs / export of data); and

• Towards a national model.

The IDEA Project has created a profile of minimum requirement for the trainees (see Annex 8). This includes the involvement of the trainees with the application of the training subjects, either directly or indirectly. This profile was sent to the National Secretaries of the TRACECA member countries. The NSs have communicated this profile to the respective institutions in their countries.

The TRACECA members have provided the IDEA Project with details on the suggested trainees. For the modelling training a total of 108 persons were nominated. As the capacity for training is limited, a filter to choose the most suitable candidates for the training was set. The filter is responsive to the profile set and was communicated to the countries. The limited number of the trainees is based on the possibility to accommodate






the maximum number of participants in a session without undermining the training efficiency. The current number of trainees was therefore reduced to 68 participants, over six training sessions. Countries have been merged together to enable an efficient conduct of the training. Adding countries followed the rational of spoken languages (Russian and English).

For modelling training, two international trainers plus a local trainer will be deployed for each session. A detailed deployment plan will be provided to the Commission for approval before starting the training sessions. For schedule and participants of the training sessions see also Annex 8. There will be ad-hoc training on communication for the PS staff, who will be also involved in the training sessions that will take place in Baku.

In order to be responsive to the interest of the member countries to train, and to enable a large number of trainees (as expressed by the countries) to use this training, the IDEA team shall employ a special e-training platform (e-IDEA, as described above) provided by TRT and an international short-term expert to grant access to additional number of trainees on line, but also to the trainees who attended the physical training. The local tutors will be a reference point for the trainees to come back with questions. Local tutors also serve beyond the IDEA Project life cycle by leaving know-how within the TRACECA countries. Also, notebooks or PCs will need to be made available. The IDEA Project will find locations where the host might offer appropriate facilities. A full VISUM license to run the transport model will be given to each TRACECA country in exchange of the PS network VISUM license.

Training on Project Appraisal

The overall training objective is to add know-how to trainees from TRACECA stakeholders’ institutions to use the TRACECA tools developed through the IDEA Project. These are in particular:

• TRACECA Appraisal Tool; and

• TRACECA Investment Manual.

The objective of the appraisal training is to respond to the current needs of the TRACECA beneficiary countries which include the understanding of cost-benefit analysis and feasibility studies. The participants shall be able to define the tasks necessary for project appraisal and to develop an understanding if projects are economically viable or not. The training shall illustrate how the documents for project appraisal have to be interpreted and what is necessary for the evaluation of an initial project assessment.

All training units will comprise of thematic introductions, discussions, group work and presentations by the trainees. Specific contents will be as follows:

• Scope of cost-benefit analysis, data needs, project cycle, steps in cost-benefit analysis;

• Transport externalities - what they are and how to measure them;

• Distribution of costs and benefits and cross-border projects, appraisal of transport demand, sensitivity and risk analysis, economic and financial appraisal;

• Frameworks for the provision and financing of transport infrastructure, forms of private-sector participation, sources of financing; and

• Risk-sharing schemes in the different procurement models, risk-allocation strategies, risk analysis, funding of infrastructure, methods and tools for project development, infrastructure procurement.

At the project-appraisal sessions, training will make large use of case studies to underline the theoretical background and to provide evidence of the different issues and






steps in the appraisal. These case studies will cover different transport modes: road, rail, ports, intermodal centres.

The IDEA Project has created profiles of minimum requirement for the trainees (see Annex 9). These include the involvement of the trainees with the application of the training subjects, either directly or indirectly. This profile was sent to the TRACECA members (National Secretaries). The NSs have communicated the profiles to the respective institutions in their countries.

For the appraisal training, a questionnaire (see also Annex 9) was developed and circulated to all NSs to obtain a clearer picture of which training component is most required in every individual country. This will enable the IDEA team to produce tailor-made training best fitting the trainees’ requirements.

For the related training, a total of 76 persons were nominated by the countries. After verification of the individual curriculum vitae according to the set profile filter, 60 participants were chosen, proposed to and agreed with the EC. Participants from different countries have been put together to enable an efficient conduct of the training. Adding countries followed the rational of spoken languages (Russian and English). The IDEA Project prepared a detailed plan (including concept, schedule, location, attendance, etc.) of the training sessions.

At each of the four appraisal training sessions, the content will be tailored and derived from the countries’ requirements. The number of attendees will be approximately 15 participants. This number allows in addition to lecture with focus on communicative teaching and effective group sessions (in groups of 3 to 5 people depending on the discussed topic) during which the attendees will have the good opportunity to discuss case studies and exchange multinational knowledge for a sustainable know-how transfer during the entire training cycle.

In each session, the trainers will be supported by a local trainer to lead and accompany the activities. The trainings will be held in one of the official TRACECA languages, in Russian or English. Translation will be provided where necessary, all training materials will be offered in both languages. All modules will make use of case studies to provide evidence of the different issues and steps in economic appraisal. Case studies will cover different transport modes: road, rail, ports, intermodal centres etc. Exercises will also be made available. For schedule and participants of the training sessions, also see Annex 9. PS staff will be also involved in the training sessions that will take place in Baku.

To enable a large number of trainees (as expressed by the countries) to use this training, the IDEA team shall utilise the e-training platform (e-IDEA) to be provided by the consortium and an international short term expert to grant access to additional number of trainees on line, but also to the trainees attended the physical training.

Training activities will end in January 2012. The last TRACECA training sessions will be devoted to the preparation of the TIF 2012, which is due to take place in the following month of February. To this aim, a training concept on project preparation will be produced, based on freely accessible information of IFIs, banks and other financial institutions.






4. Key Result 3: Identification, Prioritisation and Presentation of TRACECA Transport-Infrastructure Project Proposals

The objective of the following tasks is the contribution to the development and agreement of TRACECA regional investment plans for transport infrastructure in support of project identification, project definition and appraisal, leading to mobilisation of funding and project implementation.

4.1 Stakeholder dialogue for project appraisal and training requirements

Objective of this activity was to sound out the short-listed projects with IFIs and other stakeholders, by initiating a dialogue with potential providers of funds for each short-listed project based on existing knowledge of IFI priorities and via direct consultation with IFIs. In addition to IFIs, the IDEA team will consult with all other identified regional, national and international banks and other potential stakeholders to gain support and sponsorship for individual short-listed projects.

Need assessment was undertaken of the TRACECA countries with the aim to verify and improve communication with countries by

• following up the TIF 2010 with relevant ministries, banks and IFI resident missions;

• meeting stakeholders of new TRACECA projects and of projects presented at the TIF;

• discussing training concept, components and participants;

• explaining second project prioritisation principles;

• inquiring border-crossing procedures; and

• inquiring requirements for assistance by the IDEA Project.

Past Activities

The stakeholder dialogue is based on an analysis performed during previous reporting periods. During the past reporting period, this analysis was amplified on a country and a project level to provide an understanding of (1) TRACECA countries’ macroeconomic and social variables, (2) project infrastructure specifics, and (3) interests of individuals, groups, and institutions that have something to win or lose.

The overall aim of the country analysis was to evaluate the key variables specific to transport infrastructure for each country.

Additional to the risks involved in the projects, financial institutions and private investors base their decision on macroeconomic and social facts. Therefore, the country analysis included a macroeconomic and political study. It is a database with the relevant key factors in terms of recent improvements and status quo. A transparent database for their evaluation might help to attract investors from outside the region.

To keep on the momentum created by the TIF 2010, the whole IDEA team went to Armenia as an initial mission assessing what may be also needed for other countries. Each mission assured that both investors/banks and countries’ respective partners in industry and politics are available.

The missions were structured in agreement with the NSs and focused on communication with banks, ministries of finance and resident missions of the different IFIs. Objective of the missions was to convey the information how IDEA plans to continue to work, main activities and planned actions.






Following key aspects have been worked out:

Tajikstan:

IFC, EBRD and ADB are interested in financing the priority project “Logistic Centre Nizhnij Pyanj“, project evaluation undergoing.

Uzbekistan:

Turkish and Chinese investors are in talks with Uzbek railways to realise the priority project „Optic Fibre Cable“.

Georgia:

Very active IFIs in the country, where road sector development is the main focus of the Government.

Moldova:

EBRD has a high interest as main IFI in the market. 30 projects related to TRACECA are available for presentation during new prioritisation cycle.

Ukraine:

High potential of cooperation exists for projects in the port and road sectors.

Kyrgyzstan:

Huge inflow of donor money and grants spoils a realistic market-oriented approach to develop investment projects (not only) in the transport sector; a new PPP-law is required.

Starting in November/December 2010, the key experts visited the regions and individually continued the dialogue with stakeholders in all countries. Beside the NSs, the experts visited the respective ministries of transport and the modal administrations entrusted with the TRACECA Investment Forum / priority projects.

The Investment Climate Analysis for each of the beneficiary countries was validated by the TRACECA National Secretariats and is published on the TRACECA webpage under the section “Investments”. All information are essential assumptions for future project feasibility studies as well as for economic growth and traffic forecasts.

To optimise the utilisation of funds, TRACECA as an organisation needs to verify and, if possible, improve its communication with IFIs, whereby IDEA will facilitate this process. Starting after the investment forum, the IDEA Project developed a communication strategy to effectively promote the TRACECA benefits.

4.2 Second projects prioritisation round

After the TRACECA Investment Forum in October 2010, the European Commission recommended that the IDEA Project will re-start a new cycle with new projects. The TRACECA countries, with assistance from the IDEA Project, consequently initiated a second prioritisation cycle. The prioritisation process for the TIF 2012 follows the same approach as the previous one. Evaluation meetings started at the end of April 2011 with the first regional meeting in Almaty, followed by Kiev and Tbilisi. It was not possible to have the internet voting system already available in this prioritisation round, as it could not be activated in time.

A significant learning curve was made by the countries, all project presentation were made autonomously without much support needed from the IDEA key experts.






Past Activities

During the stakeholders’ meetings with NSs and country representatives, the IDEA team collected the preliminary ideas about the projects that will be presented at the prioritisation process. The picture is quite different among the countries. Country delegates revised the weight of the evaluation sheets prior to the start of the process with a somewhat lower on political and higher emphasis on economic criteria.

As agreed with the PS, three meetings to evaluate project proposals took place:

• For the Central Asia region in Almaty on 28 April 2011. Presenters were from Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Evaluators from other TRACECA regions came from Armenia and Moldova. Despite invitations, no external participants attended the meeting.

• For the Southeast Europe region in Kiev on 11 May 2011, with presenters from Bulgaria, Moldova, Romania and Ukraine. Evaluators from other TRACECA regions came from Tajikistan and Turkey; external observers from the local EC delegation, EIB and WB.

• For the South Caucasus & Turkey region in Tbilisi on 20 May 2011. Presenters were from Armenia, Azerbaijan, Georgia and Turkey; evaluators from other TRACECA regions came from Ukraine and Uzbekistan; external observers from the local EC delegation and USAID.2

A new attitude could be observed at the meetings, as the delegates seem to move now toward a proper regional view in discussing the different projects. 39 projects in total were presented, spanning from small (Euro 2 million) to large ones (Euro 2 billion): 16 in Central Asia, 10 in Eastern Europe and 13 in the South Caucasus & Turkey. A detailed list of project proposals is attached as Annex 10. Some of these projects come from the Commission’s TRACECA TA projects on MoS and ILC. In some other cases, these projects are further developments of those already presented for the 2010 prioritisation round. There is a fair representation of all modes of transport: 14 road, 9 rail, 4 maritime, 7 intermodal and 5 air. All modes (except for rail in Eastern Europe and maritime in Central Asia) are represented in the three TRACECA regions.

The best-ranked project proposals, as prioritised by the TRACCA countries, reflect the distribution across modes of the projects presented during the prioritisation process. Therefore, the selected projects were presented on the basis of their distribution by mode at the Infrastructure Working Group (wrap-up meeting) on 8 June 2011 in Milano.3

A short description and the estimated investment required of these best-ranked project proposals are also included in Annex 10.

Future Activities

As the project documentation presented by the TRACECA countries is sometimes insufficient, the TRACECA responsible officials will need to invest efforts into the improvement of project documentation and into an optimum use of IDEA training towards this target.

The IDEA project will assist the TRACECA countries to substantiate the selected projects by elaborating

2 The Tbilisi regional meeting and the Milano Infrastructure Working Group meeting are both included in this

Fourth Interim Progress Report, although being beyond this reporting period, since the three regional meetings constitute a united action, and the wrap-up meeting concludes the project prioritisation process.

3 This is underlined also by the IDEA team as a first step toward the implementation of a proper prioritisation

process where there is no guarantee that each TRACECA country will have at least one project in the priority list.






• actual and forecast traffic flows derived from the model;

• solid investment and operating cost estimates, by project component;

• identification and quantification of project benefits;

• for revenue generating projects, quantification of revenues;

• emphasis on the importance of the project for TRACECA, regional value;

• background information on legislation, planning process, etc.;

• provision of training; and

• publication of project proposals on TRACECA website.

In view of a third project prioritisation cycle, the IDEA Project recommends to

• move from a country based perspective toward a corridor and regional one, which should reflect the regional priorities in terms of modes and transport strategy, and

• decide whether to continue to have prioritisation meetings regionally on site or through the website (after having identified a neutral owner of the process).

4.3 Evaluation of prioritised projects

This component has as major objective the achievement of effective and sustainable coordination with IFIs for identification of “bankable TRACECA originated projects” for funding by IFIs and other financial institutions. Basis would be:

• TRACECA pre-feasibility study guidelines;

• EC visibility guidelines;

• Investment Manual as practical tool;

• Forecast model to verify impact; and

• Screening of available feasibility studies and other documents.

Activities will concentrate on in-depth analysis of priority projects. TRACECA countries’ ownership will be obtained through their participation in the training process.

Past Activities

During the past reporting period, the IDEA experts completed the careful screening of the TRACECA Investment Forum (TIF) 2010 priority projects, in order to identify project proposals for which the IDEA Project should carry out prefeasibility studies as been in the Project’s Terms of Reference. The aim of the screening was to assure completeness and plausibility of technical, economic and financial documentation and to clarify which are the candidate projects for appraisal and evaluation in order to guarantee as far as possible that the short-listed projects have a reasonable chance of success.

The screening, which was duly discussed with the European Commission Programme Manager, highlighted that the majority of the projects already had enough documentation on their technical, economic and financial aspects. At the same time it emerged that private investors or national governments had already shown interest in funding the very few projects that still did not have pre- or feasibility studies.

In January, the IDEA Project completed screening of the priority projects. The results of the screening were presented to the EC in a working paper.

IDEA identified four priority-project proposals that did not have an economic and financial pre-feasibility. However, two projects were decided to be financed independently; IDEA therefore did not see any need for a pre-feasibility study. A third project proposal is from Turkey and thus cannot receive direct technical assistance, as






Turkey is an indirect TRACECA beneficiary country. The fourth project proposal already has a technical study and IDEA proposed to complete it with a financial and economic pre-feasibility analysis, starting from the technical solutions already identified. Given the negative reaction from the concerned government authorities, the proposal was dropped.

Future Activities

It was decided that no pre-feasibility studies will be selected from project proposals of the second prioritisation round, as their selection process would be controversial. As a consequence, the EC agreed that the IDEA Project should re-focus its activity and, instead of preparing two pre-feasibility studies, should devote more efforts on supporting the TRACECA countries for the preparation of the projects’ documentation in view of the TIF 2012. This is also due to the fact that, as emerged during the stakeholder consultation and the second regional prioritisation meetings, the proposed projects are less mature compared to those of the TIF 2010 and their documentation needs to be significantly improved.

Nonetheless, the IDEA Project will produce TRACECA Pre-Feasibility Study Guidelines4. These guidelines should form the minimum requirements for future TRACECA projects to avoid different approaches for the same group of beneficiary countries, let alone being EU funded projects with different approaches and results. EU visibility guidelines will apply.

4.4 Investment manual

The Investment Manual is written to

• assist the TRACECA countries in the preparation and implementation of transport infrastructure projects with private financing; and

• illustrate a set of different procurement approaches and key issues affecting the development of successful projects with private sector financing.

Its main focus is to provide a knowledge base for procurement, financing and funding of transport infrastructure. The Investment Manual aims to act as a practical guidebook for designing sustainable infrastructure projects to implement private capital and opportunities to raise financing for infrastructure funding. The examination of case studies and examples within this investment manual illustrates a number of key principles for private-sector financing.

Each of the chapters includes several examples to underline the theoretical knowledge of infrastructure procurement. The frameworks discussed in the investment manual are based on scientific concepts and practical experiences and allow drawing generalised conclusions of what might be necessary to attract private-sector financing and to maximise value-added to the society and economy. At the same time, the manual takes in due account the specificities of the TRACECA countries, for instance in respect to the current legal framework and regulation of the transport sector.

At the end of each chapter, a different case study presents important aspects which do not allow generalising but illustrate the concepts discussed on an individual case.

The Investment Manual is part of the TRACECA appraisal tool within the “TRACECA Tool Kit”. The first version of the document has been finished before the start of the training process (June 2011) and will be fine-tuned during this period. It will be part of the training modules on project appraisal that bear a tailor-made component in line with

4 A pre-feasibility study is defined as the initial stage of the feasibility study in which the accuracy of the factors

involved such as costs and revenues is +/-25%. Should the pre-feasibility study be positive, the company would move to the final feasibility study.






the TRACECA countries’ needs. It will then be revised on basis of the outcome of the sessions and be delivered to the Commission at the end of the year 2011.

4.5 TRACECA Investment Forum

The First TRACECA Investment Forum (TIF) was held on 12 October 2010 in Brussels. Representatives of twelve TRACECA member countries presented 20 projects (1-3 per country) to the financial community – IFIs (EBRD, EIB, IFC, JICA, World Bank) and several commercial banks, to the European Commission (Director Level) and to transport operators (European and TRACECA). Representatives of over 25 countries participated in the TIF 2010. Following project presentations by the TRACECA countries, a large proportion of the presented priority projects found the interest of IFIs and private operators:

• 2 TRACECA infrastructure projects financed (road project in Turkey; road project in Georgia);

• 3 projects with loan schemes appraisal (road project "North-South Corridor” - EIB to develop a loan scheme in cooperation with the EBRD and NIF grant; Road Zestaponi-Samtredia Motorway Widening - EIB to develop a loan scheme in cooperation with the EBRD and NIF grant; logistics/international centres in Central Asia - IFC agreed to act as Lead Advisor for the ILC in Central Asia);

• 2 projects closely followed up by IFIs (Maritime/Logistics Ukraine Euroterminal Odessa - EIB and JICA to follow up to verify engagement for the bridge construction of the terminal, - Polzug and Ukrainian Operator follow-up an EU funded project for the operation of the block train Georgia/Ukraine. Railway/Kazakhstan Mojinty-Aktogay Railway Electrification – World Bank visits to the countries to verify cooperation opportunities); and

• 8 countries in investment negotiations (TIF triggered negotiations currently undergoing between IFIs / operators for the projects presented in 8 countries: Moldova, Ukraine, Kazakhstan, Uzbekistan, Tajikistan, Georgia, Armenia, Azerbaijan).

Future Activities

The TRACECA Investment Forum will ideally become a regular event to attract private and public funding and to promote TRACECA activities in terms of transport.

The TRACECA Investment Forum 2012 is planned for 28 February 2012 in Brussels. It will be based on investment projects developed during the second prioritisation process. The TRACECA countries will have the opportunity to present additional projects provided that they fulfil minimum data requirements. The TIF 2012 will not copy the first event in October 2010, but use the experience made. The focus shall be oriented more on the countries’ efforts on corridor improvement and involve globally acting financial players including Europe-based banks. In addition, private investors, funds and banks from China, India or Arabian countries will be invited. Lessons learnt from shortcomings will be considered, and as one example the dialogue with investors was triggered earlier, in the beginning of 2011. TIF 2012 main characteristics will be:

a) Add focus to the TRACECA countries’ efforts to act on international financial markets: transport policy, soft measures related to cross-border corridors, legal context, etc.;

b) Involve more European private banks;

c) Invite also global private investors and banks, logistic and transport operators as well as sovereign funds and banks from China, India, Arab countries, etc.; and

d) Present the new projects selected through the second prioritisation process.






Better and more homogenous documentation (particularly on financial figures) will be required on the priority projects to be presented at the TIF 2012. The TRACECA countries will be supported by the IDEA Project in order to achieve such an objective. Extensive use will be made of the work already done, the model, the appraisal toolkit etc. in the preparation of the candidate projects and short abstracts with the country key information will be prepared, based on the country reports, stakeholders analysis and analysis of the legislation, to be distributed at the TRACECA Investment Forum. The TIF 2012 will be made more visible on the TRACECA website. EC representatives will attend the preparation meetings with banks within the EU.

Major tasks will be:

• a new newsletter that will be periodically sent to the potential participants (banks/IFIs) in order to keep them informed on the progress toward the TIF 2012;

• additional transport operators will be attracted to the TIF 2012: a database has been created in Baku, and the existence of private railways operators from the TRACECA countries will be investigated;

• a short publication will be prepared showing the success of the TIF 2010 to be distributed together with the information about the TIF 2012 and also through the TRACECA website; and

• TRACECA countries will deliver fact sheets, project fiches and country information by latest autumn 2011.






5. Annexes to the Progress Report






Annex 1: Updated Logical Framework Matrix

Project Title : Transport dialogue and interoperability between the EU and its neighbouring countries and Central Asian countries

Project number : EuropeAid TRACECA 155-683

Countries : all TRACECA member countries

Planning period : November 2010 - May 2011 Prepared in: June 2011 Consultant : Consortium TRT, DoCo, Alfen, PTV

Results to be achieved Output and verifiable Indicators Constraints and Assumptions

Overall development goal: To improve the transport links of the EU TEN-T with the neighbouring countries (South Caucasus) and the Central Asian countries, thus facilitating trade and enabling socio–economic and environment development in the region.

Partner governments and authorities should be ready to cooperate where necessary in priority areas, take measures required in terms of endorsement of adopted legal, technical & institutional reforms and adequate resource allocation.

Overall project purpose: To enhance regional transport dialogue and transport intermodality between the EU and the countries belonging to the ENPI East Region and Central Asia region, in the context of supporting the further development of the transport system in the region and its interconnection to the major TEN-T axes.

Effective coordination mechanism between the Consultant, the IGC TRACECA Permanent Se-cretariat and the IFIs are in place for adequate evaluation of the TRACECA Long–Term strategy and selection of bankable projects

The continued strong political commitment and technical support to be provided by the IGC TRACECA Permanent Secretariat and the beneficiary countries is expected. Openness and willingness by IFIs to be fully cooperative in the desired coordination activities and for joint project preparation.

Key Result 1 – Strengthen the political and transport dialogue mechanisms

Coordinated strategy in place and working between countries to strengthen regional transport cooperation, together with demonstrated legal, institutional and regulatory system transport re-alignment in the region

SWOT analysis of the beneficiary countries Possible changes in key stakeholder organisations of a member country

At least two regional transport and infrastructure conferences at Ministerial level organised for promotion of the European Transport policy and to promote TRACECA transport and policy dialogue

Conference can be scheduled by Ministers

Agreed changes to governance and organisation structure of the TRACECA PS are implemented together with proposed amended funding mechanisms

Concept study regarding the setup of an task force

Continued strong political commitment and technical support from TRACECA PS and beneficiary countries is expected

continued on next page






continued from previous page


Thematic working-group structure established and work-ing, producing focused and structured output in support of regional investment planning and definition of infra-structure and transport projects; at least eight working groups to be convened during the course of the project

Technical papers Working groups can be programmed by EU/TRACECA

Updating, producing and disseminating TRACECA mar-keting material; web-page is assumed to be main media

Project web-site will be set up and run for the entire duration of the project

Key Result 2 – Support the implementation of the TRACECA Long Term Strategy and related Action Plans

Organising coordination meetings with IFIs, PS, NSs, EC TRACECA Project Manager, EC Delegations, national transport coordination units and project stakeholders

Two coordination meeting will be organised per year

Meetings will be aimed at elaboration and subsequent updates on communication and dissemination strategy of the project

Specific actions required by Action Plan 2008-2009 will be followed up, and input for Action Plan 2010-2012 will be defined

Action Plan Monitoring Reports Continued strong commitment and technical support from TRACECA PS and beneficiary countries is expected

Specific objectives, targets and activities requiring re-balancing within the TRACECA Long Term Strategy to 2015 are identified; monitoring tool is rolled out to assess progress on implementation of the long term strategy

Effective coordination mechanism between IDEA, TRACECA PS and IFIs in place for ad-equate evaluation of TRACECA Long–Term Strategy and selection of bankable projects

Continued strong political commitment and technical support to be provided by TRACECA Permanent Secretariat and beneficiary countries

At least two IFI regional coordination meetings are convened

Project documentation Openness and willingness by IFIs to be fully coop-erative in the desired coordination activities and for joint project preparation

High quality and successful training, including “Train the Trainers”, programme consistent with demands and needs of TRACECA PS and member countries delivered

Curriculum and performance of two five–days training sessions

Good collaboration, input and initiatives from TRACECA/NS with Consultants

Established “working community” in place comprising IFIs and TRACECA network with dedicated coordinators, inter-national and national banks and other financial institutions working in close consultation and co-operation on agreed transport investment priorities for TRACECA countries and extension of TEN-T to neighbouring countries

Project progress reports

Partner governments and authorities should be ready to cooperate where necessary in priority areas, take measures required to endorse adopted legal, technical & institutional reforms and adequate resource allocation

continued on next page






continued from previous page


Demonstrated progress aimed at ensuring the sustainability of GIS transport database for collection, collation and processing of traffic data for forecasting, analysis, investment planning and project identification

GIS database established and accessible on TRACECA web page

Coordination meeting organised between TRACECA PS, National Secretaries, EC, EC Delegations, National transport coordination units, project stakeholders and IFIs

Structured training programme customised and delivered to raise expertise levels in financing & best practices for promoting IFI and private sector investment; gain maxi-mum leverage from training offered by other TA projects

Curriculum and performance of tailor-made training sessions

Input, pro-active collaboration and initiatives from by TRACECA/NS with Consultants

Key Result 3 – Contribute to the development and agreement of TRACECA regional investment plans for transport infrastructure

Sustainability of TRACECA’s transport and traffic database system will be ensured

Frequent use of database through TRACECA Website and Tool Kit for planning & evaluation

Training on TRACECA Tool Kit was accepted by countries, its contents are applied

TRACECA project pipeline database in place and working to permit screening, selection and evaluation of potential TRACECA projects

Questionnaire to elaborate evaluation criteria; long list of lenders, sponsors and operators

Openness and willingness by IFIs to be fully cooperative in the desired coordination activities and for joint project preparation

Short list of transport infrastructure projects will be established meeting criteria of a TRACECA regional project; Support of preparation of TRACECA project documentation will be in line with IFI standards

List of short–listed projects; preparation of up to five road show meetings (organisation and content)

Desire by individual country to secure highest returns for itself, rather than taking a regional view; regular WG meetings foreseen will help to overcome these difficulties and misconceptions

At least two bankable TRACECA originated projects have IFI commitments for investment or co-financing arrangements; these IFIs have accepted to undertake full feasibility studies

Analysis of IFI internal criteria for “bankable” projects; minimum of two projects considered as bankable by IFIs; recommendations on next steps to project development

No working traffic flow model or data-base exists as a tool useful for IDEA Project purposes

A documented methodology in place for use by the PS covering the project cycle for project identification and project definition

Seminar, training and conference material Access to transport-cost tariffs and tariff setting procedures not readily forthcoming due to concerns over commercial secrets of transport operators.

“Investment Manual” for operational use and awareness training is prepared as part of TRACECA Tool Kit

Investment Manual for the TRACECA PS and TRACECA governments

TRACECA accepts Investment Manual as tool

TRACECA Investment Forums are convened; effective interfaces and working relationships are built with the IGC TRACECA and PS

Organisation of coordination meetings with the EC and IFIs for assessing developments and role of the TRACECA Investment Forums

Openness and willingness by IFIs to be fully cooperative in the desired coordination activities and for joint project preparation






Annex 2: IDEA Missions

Meetings on Second TRACECA Project Prioritisation Cycle (objectives, venues, dates)

Missions on Preparation of First TIF Venue Date

1. Stakeholder Dialogue Meetings for Armenia Yerevan Nov 30 – Dec 02, 2010

2. Central Asia Country Dialogue Mission 2011 Almaty, Astana, Bishkek, Tashkent, Dushanbe Jan 16 – Feb 18, 2011

3. Stakeholders dialogue - Interaction for Romania Bucharest Jan 24-31, 2011

4. Stakeholders dialogue / interaction for Ukraine Kiev Jan 31 – Feb 8, 2011

5. Stakeholders' dialogue for Bulgaria and Moldova Sofia, Chisinau Feb 13 – 18, 2011

6. Stakeholders' dialogue for Turkey Ankara, Istanbul Feb 21 – 23, 2011

7. Stakeholders' dialogue for Georgia Tbilisi Feb 28 – March 2, 2011

8. Prioritisation meeting Central Asia Almaty April 27 – 29, 2011

9. Prioritisation meeting SE Europe Kiev May 7 – 12, 2011

10. Prioritisation meeting S. Caucasus/Turkey Tbilisi May 18 – 21, 2011

Source: Consultant’s information

Technical meetings covering TRAX, TRACECA Transport Model, GIS and others

Meetings and Training Sessions Venue Date

1. Progress, SG, GIS meetings Brussels Dec 08 - 11, 2010

2. Completion of Roads TRAX 2010 Methodology Kiev Dec 20 - 23, 2010

3. TRACECA Model - Implementation and Deployment Berlin Jan 12 - 17, 2011

4. TRACECA Work Model, TRAX, Synergy with Ukraine Model Kiev Jan 18 - 24, 2011

5. ENPI workshop on communicating a project Brussels Feb 28 - March 1, 2011

6. Central Asian countries for the final events MoS and ILS Brussels Feb 10 - 11, 2011

7. DG MOVE workshop “Transport policy meeting with the Eastern Partnership countries

Brussels 24 March 2011

Source: Consultant’s information





Fourth Interim Progress Report, May 2011 36/113

Annex 3: Monitoring and Evaluation Plan of past Reporting Period

Project title : Transport dialogue and interoperability between the EU and its neighbouring countries and Central Asian countries

Project number: EuropeAid 155-683 Countries: all TRACECA member countries

Period: 12 November 2010 –11 May 2011 Prepared in: June 2011 Consultant : Consortium TRT, DoCo, Alfen, PTV

TIME FRAME (months) INPUTS (person-days)

12 November 2010 – 11 May 2011 Key Experts Senior Short-Term Experts Junior Short-Term Experts

No ACTIVITIES IMPLEMENTED Nov Dec Jan Feb Mar Apr May

1 Progress Meetings x 11.0 9.0 0.0

2 Transport Model x x xxx xxxx x xxx x xx x x x x xx x x x 7.0 98.0 0.0

3 Stakeholders dialogue x x x x . x xx x X x x x x x x 72.0 8.0 0.0

4 Follow-up works on GIS database & TRAX x x x x Xx x x x x x x x x x 18.0 20.5 44.0

5 Revision of investment manual x x x x x x x x x x x x 0.0 17.5 7.0

6 Revised country reports x x x 15.0 0.0 0.0

7 Harmonisation of legislation x x xxx 7.0 11.0 7.0

8 Data Collection (Rail) x xxx x x xx xx x xx x x x x x x x x x x 0.0 0.0 120.0

9 TRACECA updated map x x x x 7.0 5.5 7.5

10 Analysis of priority projects documentation x x xx xxx xx xx x x x x 0.0 61.5 55.5

11 Second prioritisation process x x x xx xxx xx xx 30.0 13.0 8.0

12 Preparation of TIF 2012 x x x xx x 39.0 0.0 0.0

13 Training for transport model x x x X 8.0 0.0 0.0

14 Training for projects appraisal x xx xxx xx xx 10.0 76.5 28.5

15 Website and communication x xx xx x xx x x x x x x x 7.0 0.0 23.0

16 Coordination, management, logistics x x x x x x x x x x xx x x 38.0 32.5 2.5

TOTAL 269.0 335.0 303.0





Fourth Interim Progress Report, May 2011 37/113

Annex 4: Annual Work Plan for next Reporting Period

Project Title : Transport dialogue and interoperability between the EU and its neighbouring countries and Central Asian countries Project number: EuropeAid

TRACECA 155-683 Countries: all TRACECA member countries

Planning Period : 12 May–11 November 2011 Prepared in : June 2011

Consultant : Consortium TRT, DoC, Alfen, PTV

Political objective: enhance regional transport dialogue and transport inter-modality between EU and these countries through enhanced co-ordination and working with IFIs, closer collaboration and participation of IFIs and private sector in TRACECA transport projects. Technical objective: improve the transport links of EU Trans European Networks with neighbouring countries (Caucasus, including Armenia, Azerbaijan, Ukraine and Georgia) and the Central Asian countries, thus facilitating trade and enabling socio-economic and environment development in the region.

No ACTIVITIES

TIME FRAME INPUTS

12 May–11 November 2011 PERSONNEL (person-days)

May June July Aug Sep Oct Nov Key Experts Senior STEs Junior STEs

1 Second prioritisation process X X X X 10 10 10

2 Progress Meetings X X X 15 10 0

3 Transport Model X X X X X X 5 15 0

4 Data Collection (Rail TRAX) X X X X X X X X X 0 0 50

5 Integration of TEN-T and TRACECA maps X X X X X 10 10 0

6 Follow-up works on TRACECA GIS database X X X X X X 5 20 100

7 Enhancement of IFI coordination X X X X X X 10 20 0

8 Evaluation multimodal TRAX X X X X X 15 10 30

9 Joint case studies following IFI methodologies X X X X 20 5 35

10 Border crossing regulations X X X X 10 0 25

11 Website and communication X X X 5 10 10

12 Preparation of priority projects documentation X X X X X X X X X 20 60 40

13 Preparation of Second TIF 2012 X X X X X X X X X X X X X X 50 70 75

14 Training for projects appraisal X X X X 10 65 60

15 Training for transport model X X X X X X X X 35 70 25

16 Communication and dissemination strategy X X X 15 5 10

17 Coordination, Management, Logistics X X X X X X X 35 35 10

TOTAL : 270 415 480






Annex 5: Annual Resource Schedule and Budget for next Period

Project title : Transport dialogue and interoperability between the EU and its neighbouring countries and Central Asian countries

Project number: EuropeAid 155-683 Countries: all TRACECA member countries

Planning period : 12 May 2011 –11 November 2011 Prepared in: June 2011 Consultant : Consortium TRT, DoCo, Alfen,

PTV

Resources / Inputs Total

planned Modified

(per May 2011) * Previous periods

This period

Total realised

Available for remainder

Personnel

Key Experts 1 600 1 800 967 269 1 236 564

Short-Term Intern. Experts 2 382 2 332

1 309 335 1 644 688

Short-Term Local Experts 2 080 1 708

410 303 713 995

Total 6 062 5 840 2 686 907 3 593 2 247

Incidental Expenditures (Euro): 800 200 828 800 125 000

(*) The revised distribution of IDEA personnel among key experts and short term international and local experts has been approved by the EC in May 2011v






Annex 6: TRACECA Technical Meeting on Traffic Forecast Model and On-Line GIS Database

Agenda

TRACECA Technical Meeting on Traffic Forecast Model

Thursday, December 9, 2010 – Traffic Forecast Model Experts Meeting

9:00 -09:30 Participants Registration

09:30-10:00

Opening Session

Ms Barbara Bernardi TRACECA Project Coordinator, DG EuropeAid Cooperation Office, Unit A.3

Ms Svetlana

Gligorovska

Policy Officer, Unit A2 International Transport & Enlargment, Directorate

Mobility and Transport – DG MOVE

Mr Eduard Biriucov TRACECA Secretary General

Tour De Table Introduction Round for the Participants / Introduction for new Participants

(Name / experience in modelling / GIS)

10:00 - 10:30

Status of the forecast model Chair: Ms Svetlana Gligorovska

• Network Updates / Socio Economic parameters

• Resulted Flows / Comparison to base year

• Feedback from the countries / Questions and answers

PTV

10 30 - 11 30

National Development Scenarios / Presentation by the countries

• Future networks

• Socio Economic scenarios

Azerbaijan / Bulgaria / Turkey/

Kazakhstan/ Tajikistan/

• Third Countries network DG – MOVE

Experts to prepare a list of future network updates envisaged for 2020 for national transport projects (See attachment to the Agenda)

11:30 - 11:45 Coffee break

11 45 13:00

Modeling Workshop PTV

Russian Language group English Language group

• Installation of VISUM

• Hands on working with the model, inserting new project links

13:00 : 14:00 Lunch

14:00 : 14:30

Modelling Training

• Content of the training Dr. Uwe Reiter

• Discussion on where , when / feedback on number of

training participants from the countries

14:30 – 15:00

Updating the TRACECA Model

• Update mechanism in VISUM PTV

• Required updates into the forecast model PTV






• Road map / Communication track between IDEA project and

the national experts (TRACECA Modelling Experts Group)

PTV

15:00 – 15 30

Dissemination of Model Results Chair: DG AIDCO

• Updating TRACECAC Atlas (Flows / Maps / TRAX)

• Partners for sharing information (definition of

Stakeholders)

15:30 – 15:45 Coffee break

15:45 – 16 30

TRACECA ROUTE INDEX

• Countries Intervention Georgia

• Methodology / Update Dr. Ashraf Hamed

16:30 – 17 00

TRACECA Prioritisation Process

• Understanding the Process

• Providing National Secretary using the model to pre-select

priority projects for TRACECA corridor prioritisation cycles

Dr. Ashraf Hamed

TRACECA Technical Meeting on On-Line GIS Database

Friday, December 10, 2010 – TRACECA GIS DATABASE Experts Meeting 9:00 -09:30 Participants Registration

09:30-09:45

Opening Session

Ms Barbara Bernardi TRACECA Project Coordinator, DG EuropeAid Cooperation Office, Unit A.3

Ms Svetlana

Gligorovska

Policy Officer, Unit A2 International Transport & Enlargement, Directorate

Mobility and Transport – DG MOVE

9:45 : 11:00

Review of the TRACECA GIS

Chair: DG AIDCO

• 3 pillars approach (TRACECA GIS Web Application,

TRACECA GIS Database, TRACECA Transport Data)

• The TRACECA Web Map Applications: Discussion about

functional enhancements / need for improvements of

user interface and new functionalities

• Country interventions /Discussion by GIS experts group

11:00 - 11:15 Coffee break

11:15 – 13:00

The TRACECA GIS Database: contents

• Existing layers of current database: new data

requirements , data collected by countries, ‘data wish-

list’ , organization future data updates (part of GIS

strategy)







13:00 : 14:00 Lunch

14:00 : 15:00

The TRACECA transport data

• The online transport data repository: Tables of the on

line database , new data requirements

• organization future data updates / database update

strategy

• Interaction with the model


15:00 – 15:15 Coffee break

15:15 – 16:00

Organization GIS Experts Group

Chair: DG AIDCO

• Strategy: Meetings, responsibilities, division of work

(database updates and maintenance, GIS strategy)

• training needs

Conclusions

TRACECA Technical Meeting on Traffic Forecast Model and On-Line GIS Database

Brussels, December 9-10, 2010

Traffic Forecast Model meeting participants:

1. Support TRACECA model which has been developed by the IDEA Project as working tool essential for TRACECA stakeholders and corridor;

2. Agree with the socio-economic database used for the preparation of the 2020 base forecast of the TRACECA model;

3. Agree that active cooperation is needed from the side of the TRACECA countries in order to improve the base forecast with reference to planned infrastructures (domestic projects, projects in non TRACECA countries) and socio economic scenarios for third countries;

4. Recognize that, in order to make it possible that countries assume ownership of the model, training will be one of the main activity, which will be organized by the project IDEA in 2011;

5. Agree that the selection of the participants to the modelling experts group will have to be based on the profile set by the IDEA project together with the European Commission: candidates need to already have knowledge of modelling; The deadline for nominating the participants is agreed to be January 15, 2011.






6. Receive a preliminary training session to have a first glance of the software capabilities and the possibilities to use it in the TRACECA countries;

7. Agree that TRACECA Atlas is a useful tool to share data and flows and routes’ attractiveness with the industry and the stakeholders. An electronic version through the web site is adequate for yearly updates. A print version can be sought when substantial changes take place (e.g. 3-5 years).

8. Agree to assume ownership of the TRAX and endorse to extend it to multi modal index to reflect all TRACECA modes.

9. Endorse the road map for the future activities of the modelling experts group.

GIS On-Line Data Base Meeting Participants:

1. Agree that the TRACECA GIS Database shall be further developed to become the “one-stop-shop” for all transport-related data in the TRACECA framework. Any interested stakeholder, administrator or the public in general shall consult TRACECA GIS Web Application for any transport information.

2. Agree that the GIS Web Application provides the technical basis for the “one-stop-shop”.

3. Noted that the Infrastructure networks will have to be updated annually. Statistical data may be updated more often, as appropriate.

4. Agree that the PS will develop a special website, where registered users from the GIS Experts Group can announce any needs for updates of infrastructure projects; the web form will enable the user to enter a short project description, and to upload any supporting maps or documents. The PS will forward this information to the relevant expert in charge for implementing these updates in VISUM.

5. Noted that DG MOVE will provide WMS services of their database, which as soon as they are published shall be included as new layer in the TRACECA GIS Web Application.

6. Agreed that the IDEA team will prepare a paper on “Strategy on database updates and functional improvements of the GIS Web Application” which will be distributed to the GIS Experts Group within the next 4 weeks for approval. Both Modelling and GIS Experts agree to keep the cycle of periodical meetings.

The forecast model was distributed to all countries along with VISUM software and dongle for the software operation.






Annex 7: Questionnaire on further enhancements of TRACECA GIS Web Application and GIS Database

The questionnaire was circulated in both English and Russian language. It was divided into three parts, i.e. one part per pillar. The first part dealt with the further development of the TRACECA GIS Web Application, the second part with the TRACECA GIS Database and the third part with the transport data. For each of the three fields, a number of several enhancements were proposed. The interviewees were asked to rate their level of agreement or disagreement, by checking the respective fields with check marks, with each of these proposals in a scale of six levels, comprising

• strongly agree;

• somewhat agree;

• neutral;

• somewhat disagree;

• disagree;

• strongly disagree.

The results of the questionnaires will be taken as basis for the further enhancement and improvements of the TRACECA GIS Web Application and the TRACECA GIS Database. The various measures proposed by the questionnaire were ranked by the GIS Experts Group.

The overall results of the questionnaires are very convincing. A total of 19 questionnaires have been returned. There were only very few disagreements on the proposals (Table 1). Most of the answers strongly agree or somewhat agree to the proposed improvements, only some answers took a neutral position.

Table 1: Questionnaire evaluation






Table 2 ranks the improvement proposals according to the number of votes that strongly agree. The result is quite interesting: Most GIS experts emphasise enhancements towards a better interconnection of the different databases and applications. A better integration with the VISUM modelling results and the inclusion of geo-data from other TRACECA TA projects deserve overall highest importance (17), followed by a better link with the transport data (15) and linkages with other EC/TEN-T databases (14).

Another important question is to ease map navigation in the TRACECA GIS Web Application. The measures “zoom to selected country” (15), “Google zoom experience” (13) and “Reset to default extent” (13) gained high scores as well.

In this context somewhat surprising was the rather poor evaluation of the measures “Link to documents” (12) and “Zoom to selected TRACECA project” (11) aiming at establishing a tight integration between the TRACECA GIS Web Application and the documentation of the investment projects by combining the best of both the GIS world (cartographic representation) and the verbal presentations (text documents).

Table 2: Ranking of measures

Anyway, the evaluation results provide a good guidance on the further development of the TRACECA GIS system through the prioritisation of the measures. It was decided to implement all measures that gained 10 or more votes (strongly agree) in the evaluation. The proper implementation of the prioritised measures concerns different experts of the IDEA team. As regards the better integration of the VISUM modelling results, the IDEA GIS experts and the traffic-modelling experts need to discuss different ways how to reach this. A close cooperation with other TRACECA TA projects is required to reach agreement to include geo-data from these projects in the GIS Web Application. A web programmer with MapXtreme skills is needed to implement the various proposals for easier map navigation and for the linkage with the transport data.






TRACECA Website Questionnaire The team of the Project “Transport Interoperability and Dialogue between the EU Caucasus and Asian” is supporting the initiative of development of the existing TRACECA website. Within the framework of this development process, this questionnaire serves obtaining feedback from the TRACECA stakeholders towards prioritizing the featured being considered for development. Your answers will be the base for fine tuning the technical specifications for the new TRACECA web-portal.

Please fill out this Questionnaire and hand it out to one of the IDEA teams.

NAME: …………………………………………………………………………….……………………

Stakeholder National Secretariat / Country >> …………….…………….……………………

Project: >>………………………………...…………………...………………………..... .………..………………………………………………………....................……..………

EC (please specify DG) >>………………….…….............................................……………………………………..

Other (please specify) >>……………………………….....……………..........................................……………….

The objective of the new web site development is to create a multi-channel communication and information-sharing platform enabling interaction amongst stakeholders. The TRACECA web site will become a portal and entry point to all TRACECA activities and content.

In my opinion, the new TRACECA web portal should:

1. Include central, searchable library for TRACECA publication

Strongly Agree

Somewhat Agree

Neutral Somewhat Disagree

Disagree Strongly Disagree

-------- -------- -------- -------- -------- --------

− Project reports and Terms of Reference

-------- -------- -------- -------- -------- --------

− Events and Proceedings -------- -------- -------- -------- -------- --------

− Presentations -------- -------- -------- -------- -------- --------

− Protocols and Agreements

-------- -------- -------- -------- -------- --------

2. Include upload area by stakeholders (e.g. IFIs) for relevant documents of transport modes, projects or country reports

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

3. Provide space and tools for creating country web pages by the National Secretaries

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

− Local language TRACECA content

-------- -------- -------- -------- -------- --------

− Country’s Stakeholders contacts

-------- -------- -------- -------- -------- --------






− Country’s transport sector reports

-------- -------- -------- -------- -------- --------

− Other country specific data

-------- -------- -------- -------- -------- --------

4. Provide space and tools for creating projects web pages to prevent loss of knowledge after project implementation, This will include project contacts, Technical documentation, Presentations, Events’ Calendar etc….

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

5. Hold Event Calendar for all TRACECA events

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

6. Include newsletters to registered Stakeholders -------- -------- -------- -------- -------- --------

7. Link to the on-line GIS database’ upload area for country infrastructure data and transport information (password protected) managed by the country’s National Secretary

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

8. Include attractive present-ation of investment projects for investors, private sector

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

9. Include personalized content page for registered stakeholders (e.g. transport administrations of member states, freight forwarders associations, IFIs officers) to follow TRACECA active-ties and upload documents.

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- --------

10. Have new design to match the new functionalities

Strongly Agree

Somewhat Agree



-------- -------- -------- -------- -------- -------- 11. Include other features you

may regard important ? Please describe in clear and readable script

Please return the questionnaire to IDEA-project team during the coordination meeting. Thank you

The IDEA-Project TEAM






Annex 8: TRACECA Transport Forecast and

Investments Impact Assessment Training

Profile for model training participants

Profile of the Modelling Training Participant

Required skills

Minimum of 5 years relevant transportation Planning experience / Work exposure

Knowledge of transportation planning procedures in home country

Understanding of transport policies, and data demand of transport models

Knowledge of home country’s transport network and access to validation data

Knowledge of home country transport forecast scenarios

Work is related transportation planning in the Ministry of Transport / Modal administration (Roads / Rail / Maritime) or in Urban administration

Preferred additional skills

Fluent in English language

Name Age Position Linguistics capabilities

English Russian

Note: Please, make sure that the suggested persons fulfil the following profile.






Training schedule and participants – Traffic Modelling

Date Location and

Origin of Participants

Nr. Participants

local

Nr. Participant travelling

Nr. Training nights

Nr. Travel nights

Nr. Trainers Key Expert

1 June 20-24 Turkey 6 5 1

2 1 Georgia 2 5 1

2 July 4-8

Bulgaria 6 5 1

2 1 Moldova 2 5 1

Romania 2 5 1

3 August 22-26 Ukraine/Odessa 13 5 1 2 1

4 September 5-9 Ukraine/Kiev 11 5 1

2 1 Armenia 3 5 1

5 October 3-7 Kazakhstan 8 5 1

2 1 Tajikistan 2 5 1

6 November 7-11

Azerbaijan 3 5 1

2 1 Uzbekistan 1 5 1

Kyrgyzstan 5 5 1

Georgia 2 0 0

Total 47 19 65 13 - -






Annex 9: TRACECA Investment Appraisal Training

Profile Economist / Financial Expert for Appraisal Training in TRACECA Countries

General skills

• University degree • 2 or more years experience in economics / financial management/ transport

engineering, work exposure • Employment in a governmental structure, modal administration (or university) • Previous education / trainings on project appraisal, financial assessment or banking

are an advantage • Experience as trainer of small groups (up to 15 people) is an asset

Additional skills

• Knowledge of English (oral and written) • Full computer literate (MS-Office package)

Language Skills

Name Position Age Russian English

Please, provide the names of your candidates for training participations for your country and note that the participants fulfill the requirements according to the above mentioned profile.

The experts shall assure continuity in your country over a longer time span by means of later know-how transfer from information provided by IDEA project or other trainings.






Questionnaire - TRACECA Appraisal Training

The team of the Project “Transport Interoperability and Dialogue between the EU Caucasus and Asian” in the framework of its activities will provide a training cycle that aims at capacity building and improvement of capabilities related to infrastructure investment project appraisal. Within the framework of this training process, this questionnaire serves obtaining feedback from the TRACECA stakeholders towards prioritizing the features considered. Your answers will be the base for fine tuning the content and form of the envisaged training sessions on regional and country levels.

Please fill out this Questionnaire and return it by mail.

NAME: …………………………………………………………………………………..………………………

Stakeholder

National Secretariat / Country >> ……………………….....……………………………

Other (please specify) >>………………………………………………………………….

Other (please specify) >>………………………………………………………………….

The objective of the training is to provide information and assure know-how transfer to all TRACECA member countries. It is one of the main objectives to create an experts’ pool in each country that will be able to assure continuity of knowledge transfer as well as a sector related capacity development. The training activities are restricted to governmental structures and administrations. The planned days are tentative indications only.

Please describe what specific topics you would like to be treated in the training and or any particular request?

Please describe in clear and readable script






The TRACECA appraisal training should:

Strongly Agree

Somewhat Agree



Provide Knowledge for Project Appraisal (2,5 days)

Sharing guidelines on how to prepare and read an appraisal (prefeasibility and a feasibility study)

How to deal with trans-border projects

Demand Analysis and Projections

(models output, simplified approaches, pricing policies)

Strongly Agree

Somewhat Agree



Financial and economic analysis differences and similarities (1,5 day)

Financial Analysis (profitability and sustainability)

Social Cost Benefit Analysis (shadow prices, consumer surplus, environmental costs)

How to deal with uncertainties Sensitivity and Risk Analysis

Strongly Agree

Somewhat Agree



Provide Knowledge for Project Management and preparation of a funding strategy (3 days)

Project finance

Contractual arrangements – contract monitoring and enforcement

Forms of financing - multi-source facilities, forms of PPP

Strongly Agree

Somewhat Agree



Include components about transaction management (1 day)

Understanding of risks by investors

Market information

Commercial incentives

Please return the questionnaire to the IDEA-project team.

Thank you. The IDEA-Project TEAM






Training schedule and participants – Project Appraisal

No Date Location

and Origin of Participants

Nr. Participants

local

Nr. Participant travelling

Demand Analysis and Projections

(2 days)

Cost-Benefit analysis (1.5 day)

Contractual arrangements

(0.5 day)

Financing and transactions

(1 day)

Nr. Trainers

Key Expert

1 June 20-24

Turkey 6 2.0 1.5 0.5 1.0

3 1 Romania 6 2.0 1.5 0.5 1.0

Georgia 1 2.0 1.5 0.5 1.0

Bulgaria 2 2.0 1.5 0.5 1.0

2 August 29 – September 2

Ukraine 14 2.0 1.5 0.5 1.0 3 1

3 October 10-14

Kazakhstan 7 2.0 1.5 0.5 1.0

3 Armenia 5 2.0 1.5 0.5 1.0

Kyrgyzstan 3 2.0 1.5 0.5 1.0

4 October 31-November 4

Azerbaijan 5 2.0 1.5 0.5 1.0

3 Uzbekistan 3 2.0 1.5 0.5 1.0

Moldova 3 2.0 1.5 0.5 1.0

Tajikistan 4 2.0 1.5 0.5 1.0

Total 32 27 24.0 18.0 6.0 12.0 - -






Annex 10: TRACECA Transport Infrastructure Projects presented and evaluated during Second Prioritisation Cycle

Project proposals presented during second prioritisation cycle

Project Code Mode Project Name

ARM1 Intermodal Yerevan logistic center

ARM2 Road Rehabilitation of key highway connections

AZR1 Rail Baku-Alyat-Beyuk-Kesik railway rehabilitation

BUL1 Maritime Varna Ferryboat

BUL2 Intermodal Ruse Terminal Construction

GEO1 Intermodal Western NIS and Caucasus International Logistic Center

GEO2 Intermodal Black Sea optic fiber cable

GEO3 Rail Georgian railway level crossing automation

GEO4 Rail Poti Baku container block train

GEO5 Maritime Ilyichevsk-Samsun shipping line

GEO6 Maritime Varna-Ilyichevsk Poti shipping line

GEO7 Road Rikoti-Zestaponi highway

GEO8 Road Zestaponi-Kutasi-Samatredia highway

KAZ1 Rail Almaty-Aktogay railway electrification

KAZ2 Rail Aktogay-Dostyk railway electrification

KAZ3 Rail Aktogay-Mojinty railway electrification

KAZ4 Road Tashkent-Shimkent road reconstruction

KYR1 Road Osh-Batken-Isfana road rehabilitation

KYR2 Air Aeronavigation

KYR3 Multimodal Implementation of Single Window System

KYR4 Air Osh airport reconstruction

KYR5 Air Issyk-Kul airport reconstruction

MLD1 Road Unguri-Brosnitsa border crossing

MLD2 Intermodal Prut river multimodal link

MLD3 Road Slobozia bypass on Chisinau-Giurgiulesti road

MLD4 Air Balti airport construction

ROM1 Road Mures-Iasi-Ungheni motorway section

ROM2 Road Constanta-Varna-Veche motorway

TAJ1 Rail Kolkhozabad-Dusty-Nizhnij Pyanj railway

TAJ2 Rail Vakhdat-Dzirgatal (-Kyrgyzstan) railway

TAJ3 Road Guliston-Dusti road rehabilitation

TAJ4 Road Khorog-Kulma road rehabilitation

TAJ5 Rail Vakhdat-Yavan new railway

TUR1 Road Gerede Gurbulak road border gate improvement

TUR2 Air Istanbul airport passengers rights information center

UKR1 Maritime Yuzhny port infrastructure development

UKR2 Intermodal Ilyichevsk port

UZB1 Road Ecological control system

UZB2 Road Centralised information web for customs






Project proposals calculated as best-ranking

Project Code

Project Name

Investment Amount

Description

KAZ4 Tashkent-Shimkent road reconstruction

71,2 Million EURO

(75 Billion Tenge)

Reconstruction of road between Shimkent – Tashkent (Uzbekistan), Length - 102 km, 4 lanes.

UZB2 Centralised Information Web for Customs

15 Million EURO Introduction of modern information technologies and means of control on road checkpoints-Alat, Yallama, Gisht-Kuprik, Dustlik, Dautota and on railway crossing points - Hozhidavlet

MLD3 Slobozia Bypass on Chisinau-Giurgiulesti road

15,6 Million EURO

Construction of a 20.5 km road bypass of 3 villages (Slobozia Mare, Cislita Prut, Giurgiulesti) along the M3 Corridor Chisinau-Giurgiulesti ensuring a connection with the international Free Port Giurgiulesti and rail terminals.

ROM1 Mures-Iasi-Ungheni motorway section

6,1 Billion EURO

The new motorway Targu Mures – Iasi - Ungheni/ border with Republic of Moldova is going to be part of the extended TEN – T network and part of TRACECA corridors.

Length: approx. 310 km, 4 Lanes.

KYR2 Aeronavigation 15,59 Million EURO

Equipping of main airports of Kyrgyz Republic (Manas, Osh, Issyk-kul) by modern radar complexes of air traffic service facilities and by system of meteorological service of flights according to international norms and ICAO standards.

TUR2

Istanbul Airport Passengers Rights Information Center

5 Million EURO

Implement at the Atatürk Airport a Centre responsible for the enforcement of European Regulation 261/2004 to assist passengers in the event of denied boarding, cancellation, long delay of flights.

TAJ2 Vakhdat-Dzirgatal (Kyrgyzstan) railway

1,6 Billion EURO

Construction of a new railway link of 296 km in a mountainous area; the project requires several engineering works (about 70 bridges, 12 overpasses, 8 tunnels for a total estimated length of 16 km, etc.). The project encompasses also the construction of 6 rail stations.

GEO4 Poti Baku container block train

8,5 Million EURO*

Provision of a Block train service interconnecting Black Sea and Caspian Sea.

*The cost estimation is related to: • 100 fitting platforms; • 100 LPG Tank container • Staff education

AZR1 Baku Alyat Beguk Kesir railway rehabilitation

1,03 Billion EURO

(1,5 Billion USD)

Capital repairs of 317 km railway in order to increase speed and safety. Upgrading of signalization system, renovation of the rolling stock, renovation of the centralized dispatcher management system based on modern technologies.

BUL1 Varna Ferry Complex

0,9 Million EURO

Repair and rehabilitation of the Ferry Complex in Varna, a port of TRACECA corridor; it is connected with the national railway and with the main road networks and operates the following lines: • Varna-Ilichevsk • Varna-Poti/Batumi/Ilichevsk; • Varna-port Caucasus.

UKR2 Ilyichevsk Port 6.85 Million EURO

(10 Million USD)

Further development of the intermodal centre through the construction of the pier of the 3rd basin of the Sukhoy estuary; modernization of the railway-station “Illichivsk Paromnaya”.

ARM1 Yerevan Logistic center

24,38 Million EURO

Develop a multimodal logistic centre in the area of Zvartnots International airport.

The project will require construction of new warehouses, transport infrastructure and other facilities.






Annex 11: Working Papers

12.1 TRACECA Route Attractiveness IndeX - TRAX

12.2 Approximation of Transport Legislation and Harmonisation of National Transport Policies

IDEA PROJECT - TRANSPORT DIALOGUE AND INTEROPERABILITY BETWEEN THE EU AND ITS NEIGHBOURING

COUNTRIES AND CENTRAL ASIAN COUNTRIES CONTRACT: 2008/155-683 A TRACECA PROGRAMME PROJECT COORDINATED BY TRT TRASPORTI E TERRITORIO


Working Paper on TRACECA Route Attractiveness IndeX - TRAX

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Working Paper 11.1

TRACECA Route Attractiveness IndeX - TRAX

TABLE OF CONTENTS

List of symbols ...................................................................................................................... 2

1. Executive Summary ............................................................................................................ 3

1.1. Abstract ........................................................................................................................ 3

1.2. TRAX Rationale ............................................................................................................ 3

1.3. TRAX vs LPI ................................................................................................................ 4

1.4. Summary of the Methodology ....................................................................................... 4

1.5. Results ......................................................................................................................... 6

2. Index Calculation Methodology ......................................................................................... 7

2.1. Data Collection and Processing .................................................................................... 7

2.2. Generation of alternative routes for analysis ................................................................. 8

2.3. Weighing of the evaluation criteria .............................................................................. 13

2.4. Assumptions for the TRAX Calculation ....................................................................... 14

2.5. Input Data for the Calculations .................................................................................... 15

2.6. Segmentation of the Routes ....................................................................................... 20

2.7. Regional adjustment of values for Stretches ............................................................... 20

2.8. Regional approach for Nodes ..................................................................................... 21

2.9. INDEX Calculation ...................................................................................................... 23

3. Future development and use of TRAX ............................................................................. 26

4. References ........................................................................................................................ 27

5. Annex 1. TRACECA TRAX Questionnaire ....................................................................... 28





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List of symbols INDEX (R) Route INDEX INDEX (S) Stretch INDEX INDEX (N) Node INDEX (R) Route (S) Stretch (N) Node I Number of Stretch, if no any other indication J Number of Node, if no any other indication N Total Number of Stretches, if no any other indication M Total Number of Nodes, if no any other indication EU European part of the Route MID Middle (Central) part of the Route CA Eastern (Central Asian) part of the Route ADJ

Adjusted value Av Average value TrC(S)

Transportation cost on stretches TiC(S) Transportation Time cost on stretches ReC(S) Transportation Reliability cost on stretches SeC(S) Risk cost (Safety) cost on stretches Α Specific weight α(S)TrC Specific weight of the Transportation cost on stretches α(S)TiC Specific weight of the Transportation Time cost on stretches α(S)ReC Specific weight of the Reliability cost on stretches α(S)SeC Specific weight of the Risk (Safety) cost on stretches C(N) Total Cost on Node AvC(N) Average Total Cost on Node TiC(N) Time cost on node ReC(N) Reliability cost on Node α(N)C Specific weight of the Average Total Cost on Node α(N)TiC Specific weight of Time cost on node α(N)ReC Specific weight of the Reliability cost on Node L (S) Length, km C Costs Tr Travel Ti Time Re Reliability Se Safety, Security K(N)w Specific weight of indexes of the utmost western node along the regional K(N)e Specific weight of indexes of the utmost eastern node along the regional C(o) Official Costs, EURO C(no) Unofficial Cost , EURO Tmin Minimum Time, in hours Tmax Maximum Time, in hours Avt Average Time, in hours VOT Travel time cost per hour, (EUR) AvS(S)i Average speed FC (S)i Total Fuel Cost on the stretch (EURO) AFC Average 1 lt. Fuel Cost, (EURO/L) RiC(S)i Risk Coefficient (SAFETY PENALTY) CE Average Fuel Consumption adjusted in the standard conditions - 0,3 lt./ 100 TrT Travel time ST Stop time T Total travel time





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1. Executive Summary

1.1 Abstract

This report presents TRACECA methodology for measuring Corridor attractiveness for the transport industry. In addition, it shows comparable calculations for the attractiveness of the TRACECA routes through the Caucasus, through Turkey / Iran and the alternative route through the Russian Federation. TRAX stands for TRACECA Route Attractiveness Index.

The methodology considers the attractiveness of the transport corridor as such for the logistics chain and not on country by country basis. Based on the World Bank definition, the transport corridors are defined from a physical perspective, as a collection of stretches “constructed from the transport networks of adjoining countries and bounded by gateways”. The gateways are in many cases multi modal and mainly are the border crossings points.

A corridor such as TRACECA has a primary economic function of promoting inter- and Intra- trade links of member countries. The rationale behind creating corridors is to ensure quality improvements along the corridor (Safety / Reliability / Cost / Transit Time of shipment).

The results of TRAX shows that TRACECA corridors require further development and substantial improvements in all aspects of the logistics of a corridor as indicated above.

1.2 TRAX Rationale

To identify the order of magnitude and benchmark the TRACECA attractiveness as a corridor, the IDEA Project considered it imperative to deploy a TRACECA own tool to measure the attractiveness of the TRACECA routes and benchmark it with alternative routes. This document illustrates the methodology adopted to develop a TRACECA Routes Attractiveness Index, which can be continuously measured to monitor improvements.

TRAX stands for TRACECA Route Attractiveness indeX. The index is an objective and numeric tool to measure the attractiveness of a transport corridor in terms of its power to attract / accommodate inter-modal freight traffic.

This document focuses on the methodology of calculating such an index for the roads based transport. This methodology will be extended in 2011 to include the inter-modal systems prevailing on TRACECA and the alternative routes.

TRAX can also be used as a tool to monitor the improvements of the TRACECA routes based over a time series through periodic re-run of TRAX for example yearly.

Therefore, the methodology was not developed as a theoretical exercise but with the following operational objectives in mind:

– Assess the attractiveness of the TRACECA routes in comparison with the competitive / alternative routes.

– Determine “the revealed preferences” in the process of route choice decision- making by the transport operators;

– Use revealed short comings affecting TRACECA attractiveness to develop solutions on the improvement of the attractiveness of the TRACECA corridor for the freight operators.

– Prioritize actions with the maximum impact on the improvement of the route attractiveness.

– Carry out the periodical monitoring of the route attractiveness index (for instance, on the annual basis)





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1.3 TRAX versus LPI

A viable question that may arise here is why not use the LPI developed by the World Bank and revised in 2009 for the purposes of TRACECA.

TRAX is developed to measure the attractiveness of a physical logistic route (corridor) and based on real measured verifiable information. It differs from the Logistics performance index LPI developed by the World Bank which measures the logistics sector “performance” in a country, providing a basis for monitoring the improvement. However as the LPI is questionnaire based. It practically measures the performance in “perceived” and hence subjective fashion.

1.4 Summary of the Methodology

This methodology has the following underlying principles:

TRAX illustrates the attractiveness indications of a route chosen by a transport operator. The set of criteria utilized had to match the views of the operators. The weighing of the criteria must also reflect the priorities and weights considered by the transport operators. The criteria chosen are particularly:

Time the transport time needed to move cargo from its origin to the final destination (OD)

Costs the transport costs used to move cargo from its origin to the final destination

Reliability The transport reliability as an essential pre-condition for state-of-the art logistics transport providers in the global business

Safety and security Cargo safety and security also as an essential pre-condition for state-of-the art logistics transport providers

The selection / weighing of the criteria ave been based on several interviews with transportation operators in the TRACECA region and in Western Europe. The criteria meet the state-of-the-art experience in transport research.

The methodology deployed followed a 4-step approach:

Step 1: Data Collection

IRU Nelti Project collected real-life drivers’ journals from a set of operators running haulage service between Europe and Central Asian / Caucasus regions. IRU provided the drivers’ journals to the TRAX approach as a courtesy.

Obtaining the “drivers’ journals” from IRU reflect the real cost and time of the transportation to / from the EU – Central Asia via alternative routes. The routes names in TRAX (Trans-Russia, Trans-Caucasus, Trans-Turkey) differ however from those used in NELTI (northern, central and southern route). TRAX routes have been renamed to reflect the territories it passes. This also avoids confusion with the TEN-T routes’ names.

It is important to note, TRAX defines routes in a broader sense as each route may comprise alternative paths. For the index calculation an averaging was built across parallel stretches to obtain the attractiveness of this particular stretch.

The drivers Journals revealed the following information:

- Identified routes for analysis (Trans-Russia, Trans-Caucasus, Trans-Turkey)





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- Time: Minimum and maximum time spent across each route (Stretches / Nodes) divided by stretched: travelling / waiting / rest time (including the border procedures)

- Cost: Minimum and Maximum actually money spent along the route (Stretches / Nodes) including official, unofficial expenditures incurred during the roads, at the border or at the ports.

Step 2: Interaction with the Industry

In this step, interviews were carried out with representatives of the transport industry and freight forwarding agents in Europe / Caucasus / Central Asia. This serves to determine the weight of various criteria. The interviews delivered information on the following issues:

- Insight on how the route choice decisions are made

- Judgment of the criteria as transportation cost, time, reliability and security through the pair-wise judgment of these criteria

- Qualitative indication of safety and security aspects (Risk)

- Identification of other topics of the special importance from the business standpoint

Step 3: Running the Calculation

Each route was divided in number of stretches and nodes along the entire corridor:

– Stretches are roads or ferries

– Nodes represent boarder points, ports, transhipment points, logistics centres and other units which presumably do not have physical size

The route index - INDEX (R) comprises two sub-indexes: stretch sub-index - INDEX (S) and node sub-index - INDEX (N).

Stretch Index INDEX (S) is calculated as a sum of the main Stretch criteria (Adjusted weights of Transportation Costs / Time / Reliability / Safety and Security) multiplied by the specific weight of each these criteria.

Node Index INDEX (N). Is calculated as a sum of the main Node criteria (Average Total costs / Time and Reliability throughout the node) multiplied by the specific weight of each these criteria.

As routes have different lengths the final index value has been adjusted to corridor length.

Step 4: TRAX Analysis

In this final step, the outcome of the index has been analyzed and prepared for communication:

• Overall comparison of TRAX for the three routes

• Assessment of Time and Reliability on Stretch

• Assessment of Time and Reliability on Node

• Transportation costs on Stretch and Node

• Time costs on Stretch and Node

• Reliability costs on Stretch and Node

• Safety and Security costs on the route

• Comparison of routes and regions in terms of Transportation Costs, Time, Reliability and Risk.





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1.5 Results

This chapter reflects the results of the methodology outlined above after deploying the information collected. It is important to note that the route attractiveness index, reflect the resistance a route has from the prespective of a freight forwarder. The higher the index, the less attractive the route will be. As every index, the figures can only be evaluated in comparison to one another.

Index Comparison for the TRACECA / alternative routes

ROUTE Total INDEX TRAVEL COST TIME COST Reliability Safety/Security

TRANS-RUSSIA ROUTE 3114 1685 6767 6373 137

TRANS-TURKEY ROUTE 6646 3408 7776 8839 300

TRANS-CAUCASUS ROUTE 8258 3446 11243 10849 221

The figures above shows, that the Trans-Russian route compared to the other two routes, is the most attractive one based on general Index, but also based on each of evaluation criteria: Travel cost, time cost, reliability and safety/security.

In particular, The Trans-Russia route attractiveness is double of the route going through the Turkish territories and almost three times ((2,75) as attractive as the Trans-Caucasus route.

Taking a differentiated look at the criteria building up the index, shows that the Travel cost factor index is almost the same for Trans-Turkey and Trans-Caucasus routes, yet double as high as the Trans-Russian Route.

The time cost factor does look much different. The time cost criteria going through Russia or through Turkey seem to be almost similar. Yet going through the Caucasus territories, the attractiveness drops to almost half of this of Trans-Russia and Trans-Turkey.

The reliability criterion reveals also that Trans-Russian route is the most attractive one, followed by the Trans-Turkey. Again Caucasus segments and nodes rank last in their appeal to the industry.





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Safety/Security criterion shows that going for the Trans-Turkey route is the least attractive option.

The above analysis is very broad and to understand a closer look much be taken at the reasons behind this. A separate document will be published on the results and its analysis on the routes attractiveness.

2. Index Calculation Methodology

The starting point of the TRAX methodology is the fundamental assumption that transports logistics companies minimizes their expected transport cost based on the so-called generalized cost (cost-based approach). This approach is generally accepted in the current transport research literature and assumes that time is also an important scarce resource in the transport decision making process. The generalized cost of a transport trip undertaken is the sum of the monetary and non-monetary costs of a journey

The reason for that proposed behavior of transporters is derived from basic microeconomic theory, assuming transport companies face stiff competition (“penny stock business”) and will act as profit maximiser to keep the business running.

Monetary ("out-of-pocket") costs might include tolls, non-monetary out-of pocket-costs, fees as well as costs of fuel and wear and tear. Non-monetary costs refer to the time spent undertaking the journey. Therefore, transport time is envisaged as a economic resource in terms of opportunity costs. In this concept, transport time -needed to move cargo from the origin to final destination-is converted to a money value using a proper value of time figure, which can vary according to trip purpose.

The generalized cost is equivalent to the price of the service in supply and demand theory, and so demand for journeys can be related to the generalized cost of those journeys using the price elasticity of demand. Supply is equivalent to capacity (for roads, road quality) on the network or transport corridor.

2.1 Data Collection and Processing

The following two sources were used for the index calculation:

1) IRU - “drivers’ journals” that have been pursued in the framework of the New Eurasian Land Transport Initiative (NELTI) Project by the International Road Union (IRU).

2) Questionnaires developed by the TRAX experts and used for interviews with the operators.

The NELTI Project is an IRU’s activity associated with the development of the Eurasian transport network. The main goal of NELTI was to create appropriate environment for the regular commercial freight traffic from the borders of China towards the final consumers in the Western and Central Europe. The first stage of the Project (September 2008 – April 2009) focused on the logistic chain from China along the historical Great Silk Way. More detailed information on the NELTI Project is available on http://www.iru-nelti.org .

The Project was officially launched on 16 September 2008 in Tashkent (Uzbekistan). The transportation under the NELTI project is performed with the use of the TIR procedure in three main directions and covers the territories of 24 countries from the borders of China with Kazakhstan and Kyrgyzstan on the East towards Belgium and the Netherlands on the West, from the Baltic ports on the North towards Iran and Turkey on the South. The total number of





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the road transportation means simultaneously operating in the framework of the NELTI project amounts to an average of 20 trips per month.

The cargo transported and covered by NELTI is quite wide: Food, consumer goods, household appliances, industrial intermediate products and equipment, drugs, diplomatic and military base cargos.

The driver journals were developed as a part of the NELTI project on the basis of the UN ESCAP monitoring methodology, when the Project’s members recorded the data on their itinerary, travel, border crossings, idle time, status of the road and support infrastructure, official fees, unofficial payments and other challenges.

The original drivers’ journals containing all specific data were obtained by TRAX / IDEA experts upon an agreement between IRU and the TRACECA Permanent Secretariat during a visit to the IRU Moscow office on January 25, 2010. (Annex 2).

In addition to the drivers’ journals; a questionnaire (Annex 3) was developed to ensure adequate input of the industry’s particularly in the weighing of the different criteria. The Questionnaire also allowed obtaining transport logistics companies views on the routes concerned. The questionnaire was divided into four parts:

− The first part inquired background information on the company and its business activities in the different countries,

− The second part inquired individual paired judgment of the transport criteria: Cost, Time, Reliability and Security& Safety. The interviewers explained the definition of each of those criteria,

− The third part was dedicated to ask for the individual risk profile of the countries on a scale ranging from risk-free to high risk,

− The fourth part allowed the interviewed person to add some comments and to address topics of special importance for her/him.

Depending on the results provided by the recipients, the TRACECA experts carried out the following activities:

− Fine-tuning of the methodology

− Calculate weight of the criteria for the index calculation.

− Calculate risk factors for the countries along the relevant routes. This serve as a basis to calculate perceived Security and Safety of Cargo for specific Countries.

2.2 Generation of alternative routes for analysis

Based on the drivers’ journals the paths along the three routes were constructed and plotted on a map.

The routes were divided in stretches inter-linked by the nodes.

Node 1

Node 2

Node 3

Stretch 1 Stretch 1





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This allows efficient exploitation of the information obtained. The routes driven within EU territories were eliminated to avoid bias of the routes. In other works, the alternative routes started and ended at the EU borders.

The transportation nodes within the TRAX framework represent state border crossing points / ports.

In several cases a single stretch is served by a number of nodes. Each node (border crossing / customs point) processes certain types of good. The selection of the crossing point by the drivers is frequently determined by the cargo type and “unofficial contacts” enabling the simplification of the border crossing process. For calculation reasons, these nodes were combined into a single node.

Based on the Drivers’ Journals three sets of routes were created as shown in the next figure:

- Trans-- Russia route

- Trans-- Caucasus route

- Trans-- Turkey route

Exploiting Drivers’ journals

For the above constructed routes, information were extracted from the drivers’ journals and incorporated into a specially developed calculation tool based on MS-Exсel.

Tables 2.2.1 and 2.2.2 illustrate the input structure of the information for the stretches and nodes, respectively. Each line of the table reflects the information extracted from one driver’s journal. Cost for fuel was not included into the transportation costs at that stage. They were added at a later point of calculation.

All expenses given in local currencies were converted into EURO at the effective rate at the date of the trip.





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Table 2.2.1 Standardized Table for Stretches

Name of Stretch, length

Time on route Costs on route

Trip №

Travelling time

Stops time (rest, loading, others)

Total time Official costs

Unofficial costs

Total

1 Trt(1) St(1) t(1) C(o)(1) C(no) (1) C(1)

2 Trt(2) St(2) t(2) C(o)(2) C(no) (2) C(2)

3 Trt(3) St(3) t(3) C(o)(3) C(no) (3) C(3)

…. …. …. …. …. …. ….

n Trt(n) St(n) t(n) C(o) (n) C(no) (n) C(n)

Average travelling time

Average Stops time

Average total time Average official costs

Average Unofficial costs

Average total costs

AvTrt= (Trt(1)+Trt(2)+Trt(3)…+Trt(n))/n

AvSt= (St(1)+ St(2)+ St(3)…+ St(n))/n

Avt= (t(1)+t(2)+t(3)…+t(n))/n= AvTrt+ AvSt

AvC(o)= (C(o)(1)+ C(o)(2)+ C(o)(3)…+ C(o)(n))/n

Av C(no)= (C(no)(1)+ C(no)(2)+ C(no)(3)…+ C(no)(n))/n

AvC=(C(1)+C(2)+C(3)…+C(n))/n= AvC(o) + Av C(no)

Table 2.2.2 Standardized Table for Nodes

№ Name of Node Time at node Costs at node, Euro

Time at crossing (including waiting)

Stop time (rest)

Total time at node

Official costs Unofficial costs total

1 TC(1) TR(1) T(1) C(o) (1) C(no) (1) C(1) 2 TC(2) TR(2) T(2) C(o) (2) C(no) (2) C(2) 3 TC(3) TR(3) T(3) C(o) (3) C(no) (3) C(3)

…. …. …. ….

…. …. ….

m TC(m) TR(m) T(m) C(o) (m) C(no) (m) C(m)

Average time for crossing (incl waiting)

Average time for rest

Average total time at node

Average official costs

Average not official costs

Average total costs

AvTC=(TC(1)+TC(2)+TC(3)+…TC(m))/m

AvTR=(TR(1)+TR(2)+TR(3)…+TR(m))/m

AvT=(T(1)+T(2)+T(3)…T(m))/m=ATC+ATR

AvC(o) =( C(o) (1)+ C(o) (2)+ C(o) (3)…+ C(o) (m))/m

AvC(no)=( C(no) (1)+ C(no) (2)+ C(no) (3)…+ C(no) (m))/m

AvC=(C(1)+C(2)+C(3)…+C(m))/m= Av C(o)+ AvC(no)

The average data on stretches and nodes were used for further calculations.

In cases where –the drivers’ journal comprises parallel (alternative) stretches within one country without nodes (i.e. identical transportation environment), stretches were consolidated into a single one Stretch with the average values of the total (Table 2.2.3).





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Table 2.2.3 Average Data on Stretch per Country

Average Data on Stretch per Country

Average Distance Av

L(s)= ∑(L(S)i)/n Where Av

L(s - Average Distance, km L(S)i – Length of stretch, km i= 1…n, n – total number of stretches

Average travelling time in the country,h (Av

TrT(s))

Average Stop time on stretches in the country,h (Av

ST(s))

Average total traveling time in the country,h (Av

T(S))

Average official costs in the country, EURO (Av

C(o) (s))

Average unofficial costs in the country, EURO (Av

C(no) (s))

Average total costs in the country, EURO (Av

C (s))

AvTrT(s) =

∑( Av

TrT(S)i)/n

AvST(s) =

∑(Av

ST(s) i)/n

AvT(S)=

∑(Av

T(S)i)/n=

AvTrT(s) +

AvST(s)

AvC(o) =

∑( Av

C(o) (S)i)/n

AvC(no)=

∑( Av

C(no) (S)i)/n

AvC =

∑( Av

C(S)i )/n=

AvC(o) +

AvC(no)

Where as , i= 1…n, n – total number of stretches

In Analogy, the same approach was applied to the node calculations. If there were several nodes operating in parallel between two countries serving the same stretch, their data were combined into single node with the average values (Table 2.2.4).

Table 2.2.4. Average Data on nodes between two countries

Average Data on nodes between two countries (ADCN) Average node time at crossin

g , h (Av

TrT(N

))

Average

stop time on

nodes (rest time),

h (Av

ST(N

))

Average total node time, h (Av

T(N))

Average official costs on nodes, EURO

(AvC(o)(N))

Average unofficial costs on nodes, EURO (Av

C(no) (N))

Average total node costs, EURO

(AvC(N))

AvTrT(N)

=∑

AvTrT(N)

j/m

AvST(N)

= ∑

AvST(N)j

/m

AvT(N) =

∑ Av

T(N)j /m= Av

TrT(N)+ Av

ST(N)

AvC(o)(N)=∑

AvC(o)(N)j/m

AvC(no) (N) =

∑ Av

C(no) (N)j /m

AvC(N) =

∑ Av

C(N) j/m= Av

C(o)(N)+ Av

C(no) (N)

Whereas , j= 1…m,

m – number of nodes between two countries

The average data were used for further calculations.

Consideration of Risk Criteria

Best option to consider the risks of a transport would use the insurance premium. During this work, insurance companies were not willing to share their experience in transport chain risk // i.e. safety and security of cargo) rating of TRACECA countries. For this, the freight forwarders interviewed were asked to rate this risk based on their experience for each country. Risk was classified in the categories “High Rusk”, “Average Risk”, “Minor Risk” / “Low Risk” or “No Risk”.

The risk assessment was done solely for the stretches. According to the freight forwarders, risk hazards were limited to the rod stretches and did not indicate any risk hazards at nodes.





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Section C of the questionnaire / Interviews, the consultant obtained the “estimation” of the operators on the risk of cargo transport within a specific country. Despite the fact that the risk may increases with the value of goods, the judgment was requested for a base type of goods. As an example, Garments was given as a type of good to evaluate. Not all companies evaluated all countries. Evaluators limited their evaluations to the countries in which they have operational experience.

Based on the classification, a risk percentage was calculated for every country. The calculation was based on an exponential function with a base of 1.26. While risk free receives a base weight value of 1, the High risk receives a weight of 2. Low risk receives a weight of 1.26 and medium risk a weight of 1.59.

Country total votes

High Medium Low Free

Total Relative value (W. Europe)

Risk index

Risk

marks

% marks

% marks

% mark

s %

Armenia 8 5 63% 3 38% 0 0% 0 0% 1,85 1,53 1,53 0,5

Azerbaijan 12 6 50% 2 17% 3 25% 1 8% 1,66 1,38 1,38 0,4

Bulgaria 16 0 0% 3 19% 8 50% 5 31% 1,24 1,03 1,03 0,0

Georgia 21 8 38% 9 43% 2 10% 2 10% 1,66 1,38 1,38 0,4

Kazakhstan 20 3 15% 8 40% 4 20% 5 25% 1,44 1,19 1,19 0,2

Kyrgyzstan 12 5 42% 3 25% 3 25% 1 8% 1,63 1,35 1,35 0,4

Moldova 15 1 7% 5 33% 7 47% 2 13% 1,38 1,15 1,15 0,1

Tajikistan 13 6 46% 3 23% 4 31% 0 0% 1,68 1,39 1,39 0,4

Turkey 18 0 0% 5 28% 6 33% 7 39% 1,25 1,04 1,04 0,0

Turkmenistan 12 4 33% 1 8% 6 50% 1 8% 1,51 1,26 1,26 0,3

Ukraine 17 1 6% 4 24% 5 29% 7 41% 1,27 1,06 1,06 0,1

Uzbekistan 12 3 25% 2 17% 3 25% 4 33% 1,41 1,17 1,17 0,2

Iran 10 4 40% 1 10% 2 20% 3 30% 1,51 1,25 1,25 0,3

Russian Fed. 21 1 5% 8 38% 7 33% 5 24% 1,36 1,13 1,13 0,1

Rumania 10 0 0% 2 20% 6 60% 2 20% 1,27 1,06 1,06 0,1

Belorussia 9 0 0% 5 56% 2 22% 2 22% 1,38 1,15 1,15 0,1

Baltic Countries 6 0 0% 1 17% 2 33% 3 50% 1,18 0,98 1,00 0,0

Western Europe 7 0 0% 2 29% 1 14% 4 57% 1,21 1,00 1,00 0,0

Eastern Europe 8 0 0% 2 25% 3 38% 3 38% 1,24 1,03 1,03 0,0

China 9 0 0% 0 0% 3 33% 6 67% 1,09 0,90 1,00 0,0

South Korea 1 0 0% 0 0% 1 100% 0 0% 1,26 1,05 1,05 0,0

India 1 0 0% 1 100% 0 0% 0 0% 1,59 1,32 1,32 0,3

Based on the above, the share of the countries in the risk classes is calculated by the percentage of the risk class by the class weight. This represents the absolute value for risk. In a next step, the risk of the different countries was referenced to Western Europe as a benchmark. The “risk factor” for every country along the comparative routes is calculated by dividing the absolute value for each country by the benchmark of Western Europe give.

The value of risk is usually expressed in monetary term. To obtain the monetary value for every stretch, the cost of transport along this stretch is multiplied by Risk Index .





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2.3 Weighing of the evaluation criteria

As indicated above, the Questionnaire was utilized to obtain the industry’s views on the relative importance of the four evaluation criteria for the route choice. Four different categories could be choose as shown in the table below.

To allow objective capture of the criteria, paired judgment approach was pursued. In this approach every two criteria are judged. Based on this judgment; the rank of the criteria was calculated. This approach utilized the Analytic Hierarchy Process (AHP). The Analytic Hierarchy Process (AHP) through its structured approach best fits dealing with the complex decisions of setting the ranking of the criteria based on paired judgment rather than prescribing the weights. The questionnaire is given in (Annex 1)

Table2.3.1: Setting the relative importance for the criteria

Transport Cost are

4 More Important

3 Slightly more Important

2 Equally Important

1 Slightly less Important

0 Less Important

compared to

Transport Time

Transport Cost are compared to

Transport Reliability

Transport Cost are compared to

Transport Safety and Security

Transport Time are compared to


Transport Time are compared to



are compared to


The judgment scale of 0-4 proves to be practical in the TRAX case. Further distinction will not affect the final result in a statistically significant way.

Calculation was made for the 4 criteria being compared leading to a total of 6 pair comparisons. The formula applies herefor is 2 P = (N (N – 1) ,

Whereas; P is the number of Paird comparison and N is the number of criteria. The total number of point is obtained by multiplying the P by the scale of judgment scale (0-4), The total number of points in the TRAX case is 6 x 4 = 24.

Each pair has therefore a ‘weight’ of 0.16667 (or 16.70 %) in the explanation of how relevant criteria are. At the same time, the result of each comparison is expressed on a rating scale (“More important”, “Slightly more important”, and “Equally important”). To keep this into account, the total weight of each pair has been split between the two criteria as follows:

− When one criteria is rated as “more important” (rate 4) it gets the whole weight (4/24 = 0.16667) while its counterpart gets 0;

− When one criteria is rated as “slightly more important” (rate 3) it gets a weight of 0.125 while its counterpart gets 0.041667;

− When one criteria is rated as “equally important” (rate 2) it gets a weight of 0.08333 and also its counterpart gets 0.08333;





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− When one criteria is rated as “slightly less important” (rate 1) it gets a weight of 0.041667 while its counterpart gets 0.125;

− When one criteria is rated as “less important” (rate 0) it gets 0 while its counterpart gets the whole weight 0.16667.

The final score of each criterion has been computed through the average of all the answers given by different evaluators:

Table 2.3.2 Weight of the criteria

WEIGHT (α) FOR STRETCHES

(S)

FOR NODES

(N) weight of the Cost (αC) 13% 22%

weight of the Transportation Time Costs (αTiC) 17% 29%

weight of the Transportation Reliability Costs (αReC) 29% 49%

weight of the Risk costs (Safety) (αSeC) 41% -

2.4 Assumptions for the TRAX Calculation

Estimates of Value of Travel Time

To enable numerical calculation of the index an estimation for the Value of Travel Time (VOT) was required. The Value of Travel Time refers to the cost of time spent on transport, i.e. travel and waiting times. A desk research was made and the approach chosen is based on the recently published Monetary Estimates of VOT. This was published by Victoria Transport Policy Institute (www.vtpi.org) as a study on Transportation Cost and Benefit Analysis II. Travel Time Costs and the Study have been presented at the meeting of International Transport Forum in 2009.

This Study use travel surveys to determine the value of travel time for Europe and other regions.

The study found that travel time has an overall average value of about $10/hour, but that for a portion of trips (estimated at 10-15% overall and up to 24% during non-working days), travel time has positive rather than negative value.

The table below summarizes typical values of time used for transport project evaluation in Europe

For TRAX calculation for road transport the value of 43 EURO has been used as a value of time.





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Fuel costs

The calculation of Index is based on officially published Fuel Prices on the following web sites

− International Road Union (www.iru.org), as primary source

− www.issa.ru, as secondary source.

2.5 Input Data for the Calculations

Input Data for the Calculations for STRETCHES

Data on Stretches obtained from the drivers’ journals:

1. Length, km (L(S)i )

2. Average Travel Time, hours (Avt(S)i )

3. Minimum Travel Time on Stretch, hours (Tmin(S)i ) – this is the minimum value of time used by the driver to travel across this stretch

4. Maximum Travel Time on Stretch, hours (Tmax (S)i ) – this is the maximum value of time used by the driver to travel across this stretch

5. Average Official costs on the Route, EURO (AvC(o) (S)i )

6. Average Unofficial costs on the Route, EURO (AvC(no) (S)i )

7. Average Total Cost on the Route, EURO - (AvC(S)i )

For the purposes of a unified approach the following assumptions were used:

1. Travel Time costs per hour, EURO (VOT). The value of this index refers to 43 EURO.

2. Average fuel consumption by the vehicle in the standard conditions – 0,3 lt. per 100 km (CE)

Calculation of the basic input values:

1. Average speed (AvS (S)i )

AvS (S)i = L(S)i / Avt(S)i

2. Reliability in hours (Re (S)i ) – this is a difference between the maximum and minimum value of the travel time, i.e. how much time may potentially be lost on stretch.

(Re (S)i ) = Tmax(S)i - Tmin (S)i )

3. Level of the Unofficial costs, %. (Cno (S)i ))

Cno (S)i ) = AvC(no) (S)i /

AvC(S)i *100%

4. Total Fuel Consumption Cost on Stretch, EURO/L, (FC (S)i ))

FC(S)i= AFC*CE* L(S)i = 0,22*0,3* L(S)i )

5. Risk Coefficient (Safety Penalties) (RiC(S)i )) – the calculation of this index is given in Section 2.2 Consideration of Risk Criteria.

Calculation of the INDEX criteria for STRETCHES

Based on the exploitation of information from the drivers’ journal; the set of input data were used for the calculation of each of the criteria for stretches:





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1. Transportation Costs

2. Risk Costs (Safety)

3. Transportation Time Costs

4. Transportation Reliability Costs

Transportation costs for Stretch (i) - (TrC(S)i ) were calculated by addition of all types of costs incurred throughout the itinerary, including official and unofficial, total cost of fuel being consumed by the vehicle in the average conditions to travel across this stretch. The value of any other costs associated with the transportation prime cost (amortization, interest, driver’s salary etc.) was not taken into account.

TrC(S)i = FC (S)i + AvC(S)i

Risk Costs (Safety) (SeC(S)i ) on stretch (i) were calculated by multiplying the cost of transportation across this stretch by the risk coefficient of the same stretch. This criterion enables the assessment of a possible increase in the transportation cost on any stretch in terms of safety and security level (Risk Premium).

SeC(S)i = TrC(S)i * RiC(S)i

Transportation Time Costs ( TiC(S)i ) were calculated by multiplying the Average Travel Time on stretch (i) by the Travel Time cost factor / hour (43 EURO).

TiC(S)i = Avt(S)i )* VOT

Reliability Costs (ReC(S)i) were calculated by multiplying the Transportation Reliability cost / hour by the Travel Time cost / hour. This criterion reflects the costs of low predictability of cargo delivery time and final costs.

ReC(S)i = Re(S)i* VOT

The results of calculations of the criteria, main indexes and basic data were brought together in a single Table for each stretch (Table 2.5.1).

IDEA PROJECT - TRANSPORT DIALOGUE AND INTEROPERABILITY BETWEEN THE EU AND ITS NEIGHBOURING COUNTRIES AND CENTRAL ASIAN COUNTRIES CONTRACT: 2008/155-683 A TRACECA PROGRAMME PROJECT COORDINATED BY TRT TRASPORTI E TERRITORIO



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Table 2.5.1 Standardized table with the Stretch estimated data

Num

ber

of S

tretc

h

Short

Desc

ription

Type o

f In

frastr

uctu

re

Countr

ies

Tra

nsp

ort

ati

on

co

st

Ris

k c

ost

(safe

ty)

Tra

nsp

ort

ati

on

Tim

e c

ost

Tra

nsp

ort

ati

on

Reliab

ilit

y

co

st

Length

of th

e s

tretc

h (

km)

Avera

ge T

ota

l T

ravel T

ime

(hours

)

Min

imum

Tra

vel T

ime

Maxim

um

Tra

vel T

ime

Relia

bili

ty in h

ours

Avera

ge s

peed

Avera

ge T

ota

l cost

s, E

UR

O

Avera

ge O

ffic

ial c

osts

, E

UR

O

Avera

ge U

noff

icia

l cost

s,

EU

RO

Level of U

noffic

ial costs

,%

Tota

l F

uel C

ost on S

tretc

h

(EU

RO

)

Avera

ge 1 lt. F

uel C

ost

(EU

RO

/L)

Tra

vel tim

e c

ost per

hour

(EU

R)

Ris

k C

oeff

icie

nt (S

AF

ET

Y

PE

NA

LT

Y)

(Si) Name of

Stretch

Road/ ferry

Name TrC(S)i SeC(S)

i TiC(S)i ReC(S)

i L(S)

i

Avt(S)i Tmin (S)i

Tmax (S)i

Re(S)

i

AvS(S)i AvC(S)i

AvC(o)

(S)i

AvC(no)

(S)i Cno

(S)i FC

(S)i AFC VOT RiC(S)i

AFC(S)i+ Av

C (S)i

TrC(S)i )

*

RiC(S)i

Avt(S)i *

VOT Re(S)i

* VOT

Source: Drivers Journals

Tmax

(S)i - Tmin

(S)i

L(S)i /

At(S)

i


AvC(no)

(S)i / Av

C

(S)i *100%

AFC*CE*

L(S)i

0,22 43 Source:

Interviews and

calculations





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Input Data for the Calculations for NODES

Data on Nodes obtained from the drivers’ journals are:

1. Average Total Costs on Node, EURO (AvC (N)j)

2. Average Official Costs on Node, EURO (AvC(o) (N)j )

3. Average Unofficial Costs on Node, EURO, (AvC(no) (N)j )

4. Minimum Waiting Time on Node in hours , (Tmin (N)j )

5. Maximum Waiting Time on Node in hours, (Tmax (N)j )

6. Average Waiting Time on Node in hours (Avt (N)j)

For the purposes of a unified approach the following assumptions were used:

1. Travel Time cost per hour, EURO (VOT). The value of this index refers to 43 EURO.

Calculation of the basic input values:

1. Reliability in hours (Re (N)j) – this is a difference between the maximum and minimum value of the travel time, i.e. how much time may potentially be lost on a node.

Re (N)j= Tmax (N)j - Tmin (N)j

2. Level of Unofficial costs, %. (Cno (N)j)

Cno (N)j= AvC(no) (N)j/

AvC (N)j*100%

Calculation of INDEX criteria for NODES

Based on the exploitation of information from the drivers’ journal; the set of input data were used for the calculation of each of the criteria for nodes:

1. Average Total Costs on Node

2. Time Cost on Node

3. Reliability Costs on Node

Average Total Costs on Node, EURO (AvC(N)j), as already stated, have been obtained from the drivers’ journals and include all types of costs incurred within the node, be it official or unofficial. The value of any other costs associated with the transportation prime cost (amortization, interest, driver’s salary etc.) was not taken into account.

Time Costs on node (TiC(N)j)were calculated by multiplying the Average Total time on node (j) by the Travel time cost factor / hour (43 EURO).

TiC(N)j= Avt(N)j* VOT

Reliability Costs on Node (ReC(N)j) were calculated by multiplying the node Reliability cost / hour by the Travel time cost / hour. This criterion reflects any possible losses or gains that could occur on this node in the favorable or unfavorable circumstances resulting to any delays in transit.

ReC(N)j= Re(N)j* VOT

The results of calculations of the criteria, main indexes and basic data were brought together in a single table for each node (Table 2.5.2).




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Table 2.5.2 Standardized table with the Node estimated data

Num

ber

of N

ode

Short

Description

Type o

f B

ord

er

Countr

ies

Avera

ge T

ota

l C

osts

on

N

od

e (

EU

R)

Tim

e c

ost

on

no

de

Reli

ab

ilit

y co

st

on

No

de

Avera

ge O

ffic

ial c

osts

on

Node, E

UR

O

Level of

Unoff

icia

l costs

, %

.

Avera

ge U

noffic

ical costs

on

Node ,

EU

RO

Min

imum

Waitin

g T

ime o

n

Node in h

ours

Avera

ge tota

l Waitin

g T

ime

on N

ode in h

ours

Maxim

um

Waitin

g T

ime o

n

Node in h

ours

Relia

bili

ty in h

ours

Tra

vel tim

e c

ost p

er

hour,

(E

UR

)

(N) Name of

node

Road /

Sea

Name AvC (N)j TiC(N)j ReC(N)j AvC(o) (N)j C(no) (N)j

AvC(no)

(N)j Tmin

(N)j

Avt (N)j Tmax

(N)j Re (N)j) VO

T

AvC(o) (N)j + AvC(no) (N)j

Avt (N)j * VOT

Re (N)j * VOT

Sou

rce

: D

rivers

Jo

urn

als

AvC(no)

(N)j / AvC

(N)j *100%


Tmax

(N)j - Tmin

(N)j

43





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2.6 Segmentation of the Routes

The calculation of the index TRAX was made by adding the values along stretches and nodes as described above. To enable comparison and improvements monitoring, an intermediate step was introduced by creating regional sub index (R-TRAX). Each route was appropriately divided in three sections:

- European section,

- Middle/ Central section

- Central Asia

Consequently, the data on any route section comprise all data on nodes and stretches within this region of the route.

The spatial distinction for the regions is given below:

Trans – Russia route Trans – Caucasus route

Trans – Turkey route

European section Belorussia Ukraine

Rumania

Bulgaria

Bulgaria

Turkey

Middle (Central) section

Russia Black Sea Ferry, Georgia, Caspian Ferry, Azerbaijan

Iran

Eastern section

(Central Asia)

Kazakhstan/ Uzbekistan/ Kyrgyzstan/

Kazakhstan

Uzbekistan

Kyrgyzstan

Turkmenistan

Uzbekistan

Kyrgyzstan

2.7 Regional adjustment of values for Stretches

As stated above, the criteria for the Stretch index calculation were as follows:

1. Transportation Costs (TrC(s))

2. Risk Costs (Safety) (SeC(s))

3. Transportation Time Costs (TiC(S))

4. Transportation Reliability Costs (ReC(s))

The data on these criteria derived from the calculations described above were adjusted to fit the regional approach as follows:

European section Middle (Central) section

Eastern section (Central Asia)

Transportation costs TrC(s) TrC(s)EU = ∑ TrC(S)i TrC(s)MID = ∑ TrC(S)i TrC(s)CA = ∑ TrC(S)i

Risk costs (Safety) SeC(s) SeC(s)EU =∑ SeC(S)i SeC(s)MID =∑ SeC(S)i SeC(s)CA =∑ SeC(S)i

Transportation Time costs TiC(s)

TiC(s)EU = ∑ TiC(S)i TiC(s)MID = ∑ TiC(S)i TiC(s)CA = ∑ TiC(S)i





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Transportation Reliability costs ReC(s)

ReC(s)EU =∑ReC(s)i ReC(s)MID=∑ReC(s)i ReC(s)CA=∑ReC(s)i

Length of the regional section, km L(S)

L(S)EU= ∑L(s)i L(S)MID= ∑L(s)i L(S)CA= ∑L(s)i

i=1…n,

n- number of stretches on the European section of the route

i=1…m,

m- number of stretches on the Middle (Central) section of the route

i=1…k,

k- number of stretches on the Eastern section of the route (Central Asia)

It is important to mention that the adjustment of the total index value to the length (for comparison reason as mentioned above) was made at the regional level and not for the entire corridor. This does not only ensure the comparability of the total index TRAX but also for the regional index R-TRAX. There was no adjustment made for the Node data.

Furthermore, for the data adjustment purposes, the average length, km (AvL(S)) was specified. The average length of the route is calculated as an average value of all integrated regional sections of this route.

AvL(s)=( ∑ L(s)i)/N, i=1….N (N – number of the regional parts)

The adjustment was applied to the following main values of each regional section of the route:

European section Middle (Central) section


Adjusted Transportation costs (

ADJTrC(S))

ADJTrC(S)EU

= TrC(S)EU

/

L(S)EU * Av

L (S)

ADJTrC(S)MID

= TrC(S)MID

/

L(S)MID* Av

L (S)

ADJTrC(S)CA

= TrC(S)CA

/

L(S)CA* Av

L (S)

Adjusted Risk (Safety) costs SeC

ADJs

SeCADJ

s(EU)= SeCEU

s / L(S)EU *

AvL (S)

SeCADJ

s(MID)= SeCMID

s / L(S)MID*

AvL (S)

SeCADJ

s(CA)= SeCCA

s / L(S)CA*

AvL (S)

Adjusted Transportation Time costs

ADJTiC(S)

ADJTiC(S)EU

= TiC(S)EU

/

L(S)EU * Av

L (S)

ADJTiC(S)MID

= TiC(S)MID

/

L(S)MID* Av

L (S)

ADJTiC(S)CA

= TiC(S)CA

/

L(S)CA* Av

L (S)

Adjusted Reliability costs ReC(S)

ADJReC(S)EU

= ReC(S)EU

/ L(S)EU * Av

L (S)

ADJReC(S)MID = ReC(S)MID

/ L(S)MID* Av

L (S)

ADJReC(S)CA =ReC(S)CA/

L(S)CA* Av

L (S)

2.8 Regional approach for Nodes

In analogy to the regional approach for stretches, nodes representing the border crossing points and ports were also classified in accordance with the regional principle described above. For nodes at the borders between two regions, it was necessary to divide the node data into two sub-nodes. The division of the cost, time and the reliability values of a node were calculated by dividing them according to the length of the stretch they are connected to. For example for the Node (N) that accommodates two stretches, one is European (Sw) and one Eastern (Se). The lengths of the both stretches are known (L(S)w, L(S)e ), then one might assume that the node accommodates the route with the following magnitude: (L(S)w + L(S)e). However Sw and Se refer to the different regional sections of the route, and the node (N) accommodates two regional stretches. Now therefore:

1) Specific Node (N) weight (KN) for the Stretch (Sw) will be equal to:

K(N)w = L(S)w / (L(S)w + L(S)e)

2) Specific Node (N) weight (KN) for the Stretch (Se) will be equal to:

K(N)e = L(S)e / (L(S)w + L(S)e).





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As stated above, the node index calculation is based on the following three main criteria:

1. Average Total Costs on Node, EURO (AvC(N)j) ,

2. Time Costs on Node (TiC(N) j)

3. Reliability Costs on Node (ReC(N) j)

Therefore the specific weight value has been calculated with the use of the indicated criteria:

Node European section Middle (Central) section


Average Total Costs on node, EURO (

AvC(N))

AvC(N)EU=

K(N)w* Av

C(N)jw +∑ Av

C(N)j+ K(N)e*

AvC(N)je

AvC(N)MID=

KNw* AC N(jw) +∑ACN(j)+ KNe* ACN(je)

AvC(N)CA=

KNw* ACN(jw) +∑ACN(j)+ KNe* ACN(je)

Time Costs on node (TiC(N)) TiC(N)EU=

K(N)w* TiC(N) jw +∑ TiC(N)j+ K(N)e* TiC(N)je

TiC(N)MID=


TiC(N)CA=


Reliability Costs on node (ReC(N))

ReC(N)EU =

K(N)w* ReC(N)jw +∑ ReC(N)j+ K(N)e* ReC(N)je

ReC(N)MID =


ReC(N)CA =


Definitions j=1…n, n – number of nodes on the European section,

jw- utmost Western node on the European section

je – utmost Eastern node on the European section

j=1…n, n – number of nodes on the Middle section,

jw- utmost Western node on the Middle section

je – utmost Eastern node on the Middle section

j=1…n, n – number of nodes on the Eastern section

jw- utmost Western node on the Eastern section

je – utmost Eastern node on the Eastern section

The results of calculations have been consolidated in the summary table for each route section shown below.

Name of Route

Region European

Central (Middle)

Eastern (Central Asia)

Total Country Names Names Names

ST

RE

TC

H D

AT

A

Transportation Costs TrC(S)EU TrC(S)MID

TrC(S)CA

TrC(S)= TrC(S)EU

+ TrC(S)MID

+ TrC(S)CA

Adjusted Transportation Costs ADJ

TrC(S)

EU

ADJTrC(S)

MID

ADJTrC(S)

CA

ADJTrC(S)=

ADJTrC(S)EU

+

ADJTrC(S)MID

+

ADJTrC(S)CA

Transportation Time Costs TiC(S)EU TiC(S)MID

TiC(S)CA

TiC(S)= TiC(S)EU

+ TiC(S)MID

+ TiC(S)CA

Adjusted Transportation Time Costs

ADJTiC(S)

EU

ADJTiC(S)

MID

ADJTiC(S)

CA

ADJTiC(S)=

ADJTiC(S)EU

+

ADJTiC(S)MID

+

ADJTiC(S)CA

Transportation Reliability cost ReC(S)EU ReC(S)MID

ReC(S)CA

ReC(S)= ReC(S)EU

+ ReC(S)MID

+ ReC(S)CA

Adjusted Transportation Reliability Costs

ADJReC(S

)EU

ADJReC(S)

MID

ADJReC(S

)CA

ADJReC(S)=

ADJReC(S)EU

+

ADJReC(S)MID

+

ADJReC(S)CA





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Risk (Safety) Costs SeC(S)EU SeC(S)MID

SeC(S)CA

SeC(S) = SeC(S)EU

+ SeC(S)MID + SeC(S)CA

Adjusted Risk (Safety) Costs ADJ

SeC(S

)EU

ADJSeC(S)

MID

ADJSeC(S

)CA

ADJSeC(S)=

ADJSeC(S)EU

+

ADJSeC(S)MID +

ADJSeC(S)CA

Length, km L(S)EU L(S)MID L(S)CA L (S)= L(S)EU +L(S)MID +L(S)CA

Average Length, km Av

L (S)

NO

DE

DA

TA

Average Total Costs on Node Av

C(N) EU Av

C(N)MID Av

C(N)CA Av

C(N) = Av

C(N) EU+

AvC(N)MID+

AvC(N)CA

Time Cost on Node TiC(N)EU TiC(N)MID TiC(N)CA TiC(N)= TiC(N)EU + TiC(N)MID +TiC(N)CA

Reliability Costs on Node ReC(N)EU ReC(N)MID ReC(N)CA ReC(N)= ReC(N)EU + ReC(N)MID +ReC(N)CA

NODES Names Names Names Names

2.9 INDEX Calculation

As noted above, the Route Index consists of two sub-indexes: stretch sub-index and nod sub-index.

TRAX - Roads INDEX (R)= INDEX (S) + INDEX (N)

Stretch INDEX (S)

The INDEX (S) for stretches is calculated as a sum of stretches’ criteria (Adjusted Transportation Costs, Adjusted Time Costs, Adjusted Reliability Costs, and Adjusted Safety Costs) multiplied by the specific weight of each criterion specified in Section 1.4. The adjustment relates to the length of each stretch. The following formula applies for the calculation of INDEX (S):

INDEX (S) = (ADJTrC(S) * α(S)TrC + ADJTiC(S) * α(S)TiC + ADJReC(S) * α(S)ReC + ADJSeC(S) * α(S)SeC ),

However; this index was first calculated on the basis of the regional approach indicated above region (section) of the route, while the specific weights of criteria remained unchanged:

INDEX (S)EU = (ADJTrC(S)EU* α(S)TrC + ADJTiC(S)EU* α(S)TiC + ADJReC(S)EU * α(S)ReC + ADJSeC(S)EU * α(S)SeC )

INDEX (S)MID = (ADJTrC(S)MID * α(S)TrC + ADJTiC(S)MID * α(S)TiC + ADJReC(S)MID * α(S)ReC + ADJSeC(S)MID * α(S)SeC )

INDEX (S)CA = (ADJTrC(S)CA * α(S)TrC + ADJTiC(S)CA * α(S)TiC + ADJReC(S)CA * α(S)ReC + ADJSeC(S)CA * α(S)SeC )

The total index can also be calculated by adding up the regional index. The following formula is valid.

INDEX (S) = INDEX (S)EU +INDEX (S)MID+ INDEX (S)CA =

= (ADJTrC(S) * α(S)TrC + ADJTiC(S) * α(S)TiC + ADJReC(S) * α(S)ReC + ADJSeC(S) * α(S)SeC )





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Node INDEX

The INDEX (N) for Nodes is calculated as a sum of the nodes’ criteria (Average Total Costs on Node, Time Costs on Node and Reliability Costs on Node) multiplied by the specific weight of each node criteria specified in Section 2.3. Therefore:

INDEX (N) = (AvC(N) * α(N)C + TiC(N)* α(N)TiC + ReC(N)* α(N)ReC),

However, this index was first calculated on the basis of the regional approach indicated above for each region (section) of the route, while the specific weights of criteria remained unchanged:

INDEX (N)EU = (AvC (N)EU* α(N)C + TiC(N)EU * α(N)TiC + ReC(N)EU * α(N)ReC)

INDEX (N)MID = (AvC (N)MID * α(N)C + TiC(N)MID * α(N)TiC + ReC(N)MID * α α(N)ReC)

INDEX (N)CА = (AvC (N)CA* α(N)C + TiC(N)CA * α(N)TiC + ReC(N)CA * α α(N)ReC)

The total index can also be calculated by adding up the regional index. The following formula is valid.

INDEX (N) = INDEX (N)EU +INDEX (N)MID+ INDEX (N)CA =

= (Av C(N) * α(N)C + TiC(N)* α(N)TiC + ReC(N)* α(N)ReC)

The results of index calculations were calculated separately for each route on the basis of the regional approach and further combined in the summary table

.




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ROUTE TRANS - RUSSIA TRANS - CAUCASUS

TRANS - TURKEY Region Europe Middle (Central) Part East part (Central Asia)

Total

Countries Names Names Names

Total INDEX INDEX(R)EU =

INDEX (S) EU + INDEX (N) EU

INDEX(R)MID =

INDEX(S) MID + INDEX(N) MID

INDEX(R)CA =

INDEX(S) CA + INDEX(N) CA

INDEX (R)=

INDEX (S) + INDEX (N)=

INDEX(R)EU +INDEX(R)MID +INDEX(R)CA

Stretch INDEX

INDEX (S)EU =

(ADJTrC(S)EU* α(S)TrC + ADJTiC(S)EU* α(S)TiC + ADJReC(S)EU * α(S)ReC + ADJSeC(S)EU * α(S)SeC )

INDEX (S)MID =

(ADJTrC(S)MID * α(S)TrC + ADJTiC(S)MID * α(S)TiC + ADJReC(S)MID * α(S)ReC + ADJSeC(S)MID * α(S)SeC )

INDEX (S)CA =

(ADJTrC(S)CA * α(S)TrC + ADJTiC(S)CA * α(S)TiC +

ADJReC(S)CA * α(S)ReC + ADJSeC(S)CA * α(S)SeC )

INDEX (S) =

INDEX (S)EU +INDEX (S)MID+

INDEX (S)CA= (ADJTrC(S) * α(S)TrC + ADJTiC(S) * α(S)TiC + ADJReC(S) * α(S)ReC + ADJSeC(S) * α(S)SeC )

Node INDEX INDEX (N)EU =

(AvC (N)EU* α(N)C + TiC(N)EU * α(N)TiC + ReC(N)EU * α(N)ReC)

INDEX (N)MID =

(AvC (N)MID * α(N)C + TiC(N)MID * α(N)TiC + ReC(N)MID * α α(N)ReC)

INDEX (N)CA =

(AvC (N)CA* α(N)C + TiC(N)CA * α(N)TiC + ReC(N)CA * α α(N)ReC)

INDEX (N) =

INDEX (N)EU +INDEX (N)MID+

INDEX (N)CA=

(Av C(N) * α(N)C + TiC(N)* α(N)TiC + ReC(N)* α(N)ReC)





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3. Future development and use of TRAX

TRAX methodology for road transport and calculations results shall be published on the TRACECA web site illustrating the reference year 2010. Regular update shall be made for TRAX to show the improvement in the TRACECA route attractiveness compared to alternative routes.

In this regard and in the course of 2011, TRAX will be further development to Intermodal Index TRAX by including the railway born transport links along the TRACECA routes and the Trans-Russian routes.

For intermodal index, a similar methodological approach for all its components will be applied, namely: road and rail transport indexes.

In analogy to road-TRAX; the rail TRAX will be calculated to reflect the attractiveness indicators of a route chosen by a transport operator particularly time, cost, reliability of transportation and safety. The weighing of the criteria must also reflect the priorities and weights considered by the transport operators.

Data collection, definition of criteria weights, formation and segmentation of the route will be made in cooperation with transport companies and operators by questionnaires and interviews based on actual cargo logs and documentations.

Planned integrated approach to data collection at the national and international level:

4) Questionnaire survey and Interviews with some national railway administrations / companies - to provide national data on individual countries on route lines, tariff scale, costs of transportation on stretches and processing in the nodes, indicative time of the transportation through the route (stretch) and carry out the necessary operations in the nodes.

5) Questionnaire survey and Interviews with operators / companies / freight forwarders, providing services of rail transportation - to receive data at the national level for individual countries about the time and cost of transportation by rail on a particular route (stretch/node)

6) Questionnaire survey and Interviews with operators / companies / freight forwarders, providing services of international rail transportation - to receive data at the international level about the time and cost of transportation by rail on particular route (stretch/node) in terms of non-resident.

Hence, each stretch or node gets three types of assessment on time and cost of transportation:

- In terms of national railway administration

- In terms of national rail transport operator / freight forwarders

- In terms of international rail transport operator / freight forwarders.

Further, the calculation of the reliability of railway transportation, average cost and time will be carried out in the same way as in the above described methodology.

The selection / weighing of the criteria have been based on several interviews with transportation operators in the TRACECA region and in Western Europe. The criteria meet the state-of-the-art experience in transport research





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Intermodal index Trucks will be calculated based on value (specific gravity) of road and rail traffic for each route.

4. References

NEW EURASIAN LAND TRANSPORT INITIATIVE, Final report, Analysis of monitoring data collected on NELTI Project Routes in 2008 – 2009

Becker, G.S. (1965) A theory of the allocation of time, in: Economic Journal, Vol. 75 (3), Pages 493-517

Bruzelius, N. (1979) The value of travel time, 1st edition, Croom Helm, London

De Serpa, A.J. (1973) A theory of the economics of time, in: Economic Journal, Volume 81, Pages 825-841

Evans, A.W. (1972) On the theory of the valuation and allocation of time, in: Scottish Journal of Political Economy, Volume 19, Pages 1-17

Goodwin, P.B. (1981) The usefulness of travel budgets, in: Transportation Research, Volume 15 A, Pages 97-106

EURASIAN DEVELOPMENT BANK (2009) The EURASEC Transport Corridors – Sector Report

UNITED NATIONS (2008) Joint study on developing Euro-Asian Transport Linkages

SSATP (2008) Sub-Saharan Africa Transport Policy Program, Lessons of Corridor Performance Management- Discussion Paper No. 7, Regional Integration and Transport

Arvis, J.F., Raballand, G. and Marteau, J.F. (2007) The cost of being landlocked: logistics costs and supply chain reliability, WP 4258, The World Bank Group

The World Bank Group (2005) Best Practices in Corridor Management

11. EUCAM (2009) Optimization of Central Asian and Eurasian Trans-Continental Land Transport Corridors, working paper 09

NELTI (New Eurasian Land Transport Initiative – Final Report-2008

Catalany, M. (2009) Transport competition on a multimodal corridor by elasticity evaluation, University of Naples/Italy

NCHRP Report No 431,(2009) National Cooperative Highway Research Program, Valuation of Travel Time Savings and Predictability in Congested Conditions for Highway Use Cost Estimations

The World Bank Group and Turku School of Economics (2007) Connecting to Compete- Trade Logistics in the Global Economy-The Logistics Performance Index and its Indicators, accessible on online World Bank resources

U.S. Department of Transportation, Federal Highway Administration, (2004) Freight Transportation Improvements and the Economy





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5. Annex 1. TRACECA TRAX Questionnaire

The team of the Project IDEA “Transport Interoperability and Dialogue between the EU, Caucasus and Asian” is supporting the initiative to improve the attractiveness of the TRACECA Transport Corridor. Within this framework, this questionnaire serves obtaining feedback from the TRACECA stakeholders towards prioritizing the main features for development. Your answers will be the base for identification of the existing bottlenecks and fine tuning of the priority ranking of future transport investments in the TRACECA Corridor.

Please fill in this questionnaire and return it to the IDEA team

Part A. General questions on company’s scope of activity

Name of the Company:

…………………………………………………………………………………………………………………

Company address

…………………………………………………………………………………………………………………

Contact Partner / Phone number

…………………………………………………………………………………………………………………

Business field

…………………………………………………………………………………………………………………

Number of staff

…………………………………………………………………………………………………………………

Number of trucked containers per year

…………………………………………………………………………………………………………………

Client locations in TRACECA countries:

Yes No Under Planning

Armenia

Azerbaijan Bulgaria Georgia Kazakhstan Kyrgyzstan Moldova Tajikistan Turkey Turkmenistan Ukraine

Uzbekistan Romania

Islamic Republic of Iran





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Client locations in other countries:

Yes No Planning

Western Europe

Eastern Europe

Russian Federation

People’s Republic of China

South Korea India

Do you make use of multimodal operations on the TRACECA transport route?

Yes No Planning

Part B. Specific questions on criteria for selection of transport routes

(In the following specific section, please indicate by pair-wise comparison which of the following statements hold for your particular transport decisions. Please tick proper middle box (√)

Decision Criterion I

Relevance Please, tick the box Decision Criterion II

Transport Cost

less important

Transport Time

slightly less important

equally important

slightly more important

more important

Transport Cost

less important



equally important


more important

Transport Cost

less important

Tracking and Safety slightly less important

equally important





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more important

Transport Time

less important



equally important


more important

Transport Time

less important

Tracking and Safety


equally important


more important


less important

Tracking and Safety


equally important


more important

To finish this questionnaire, please tell us about the risk-profile of carrying through (transit) and in-between the above-listed countries.

Country High Risk Medium Risk Low Risk Risk-Free Armenia

Azerbaijan Bulgaria Georgia Islamic Republic of Iran Kazakhstan Kyrgyzstan Moldova People’s Republic of China

Russian Federation Tajikistan Turkey Turkmenistan Ukraine

Uzbekistan Romania

Please address more topics in the next field you might find of importance

Thank you very much for your time spent to answer our questions.

The IDEA-Project TEAM




Working Paper on Approximation of transport legislation and harmonisation of national transport policies

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Working Paper 11.2

Approximation of transport legislation and harmonisation of national transport policies

Table of Contents

1. Outline of the existing situation and general approach ............................................... 2

1.1 General situation ..................................................................................................... 2

1.2 Working approach and activities conducted ............................................................ 3

1.3 Review and analysis of the existing situation ........................................................... 4

1.3.1 Community guidelines for development of the TEN-T....................................... 4

1.3.2 Questionnaire survey ....................................................................................... 4

1.3.3 Review of existing country and regional strategy documents ............................ 5

1.3.4 Legal recommendations from other TRACECA projects ................................... 6

2. Identification of priority sub-sectors and activities ...................................................... 8

2.1 General principles and methodology ....................................................................... 8

2.1.1 The approximation process .............................................................................. 8

2.1.2 Feedback on the questionnaire survey ............................................................. 9

2.2 Technical standards for enhanced interoperability ..................................................10

2.3 Institutional standards ............................................................................................13

2.4 Legal framework relating to non-physical barriers and standards ...........................16

2.5 Legal framework relating to the attraction of additional investments .......................20

3. Conclusions and recommendations for further actions .............................................24

3.1 General observations, constraints and conclusions from the review phase ............24

3.2 Recommendations on implementation support .......................................................25

3.2.1 International Conventions ................................................................................26

3.2.2 Bilateral and multilateral agreements ..............................................................27

3.2.3 Facilitation of border crossing ..........................................................................27

1.3 Next activities .........................................................................................................28





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1. Outline of the existing situation and general approach

1.1 General situation

The limited co-ordinated development by TRACECA member countries of regulatory and legal systems, aimed at enabling the development of an effective cross-border transport network, is a principle problem of the TRACECA countries. As part of the IGC Long-Term Strategy, TRACECA member countries have agreed to gradually harmonise their legal and regulatory frameworks across all transport sectors in accordance with international and European standards.

It is quite obvious that a well-developed transport legal framework on several levels is an integral part of any construction, installation and maintenance of sound, reliable, safe and also profitable transport systems: it comprises the participation in international agreements for all modes of transport as well as the public law (the legal format of the transport policy) and the civil transport law (the relationship between the transport operators/providers and the professional and private transport users).

Furthermore, when addressing the legal framework in transportation, we refer to:

• Technical standards for enhanced interoperability, safety and security in all modes of transport;

• Institutional standards mainly related to competition in the sector, i.e. unbundling of policy making, executive and operating functions in each TRACECA country;

• Legal framework relating to non-physical barriers and standards in each TRACECA country and cross-border;

• Legal framework relating to the attraction of additional investments, e.g. concession laws;

• Bi- and multilateral transport agreements and conventions and their ratification, application and enforcement, including the MLA and its technical annexes;

in each of the TRACECA countries.

Aggravating the problem in keeping up with the actual situation is that each national and the entire international legal framework are undergoing frequent alterations and adaptations. In this respect it has also to be mentioned that, with each international agreement signed by a certain country, there is the need of transposing the convention into national legislation in order to enable legal implementation and enforcement.

Multiple attempts have been undertaken on several intervention levels – internally by countries themselves, externally by international development partners and partner countries, international organisations and associations, regionally, bi-laterally and multi-laterally in order to harmonise the policy and legal framework for international and multi-modal transport.

In this huge range of transport-related legal and policy settings, there was a strong need to focus on certain crucial issues which impede the smooth flow of goods and passengers between EU-TRACECA and between most critical TRACECA-TRACECA links.

The terms of reference of the IDEA Project request to address above issues and further strengthen the coordinated mechanisms for strengthening transport cooperation, together with demonstrated legal, institutional and regulatory transport-system approximation in the region (Objectives 1 and 2 with related Result 1 of the ToR). IDEA’s approach for this task is given in the following based on the Consortium’s proposal, on elaborations and findings of related tasks arising during project implementation and on further discussions within the project team.





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The principle mandate for this task is given by the TRACECA countries themselves, quoting from Chapter 2.3 “From Proposals to Actions” of the adopted IGC Long-Term Strategy:

“TRACECA countries will realign their existing transport legislations towards international transport conventions and agreements and bring them closer to the EU transport legislation (transport acquis).”

In the course of investigations there is an important issue to be recalled:

The EU aquis , its transport procedures and laws are frequently more demanding then international standards. UN standards, for instance, very often adopt only a minimum consensus acceptable for all involved countries.

Especially in transport safety, security and environmental matters, free trade or technology-application matters, the EU goes beyond international or former Soviet Union standards.

The experts oriented their activities towards the more demanding EU standards and herein towards the priorities for applying those standards to TRACECA countries.

1.2 Working approach and activities conducted

The IDEA experts followed a stepwise working approach as shown with the arrows below:

The following activities were carried out and are described further in the following chapters:

• Review the latest EU trade and transport-related acquis communautaire and elaboration / adaptation of an Explanatory Note;

• Compile a legal matrix for TRACECA countries;

• Compile a list of conventions and identifying TRACECA countries ratification status;

• Elaborate an questionnaire survey on the basis of the legal matrix and the list of conventions for obtaining TRACECA countries view on the status of harmonisation. The questionnaire survey was sent to all TRACECA countries;

• Gather and review TRACECA countries’ national transport strategies on approximation issues;

• Gather and review TRACECA project reports on approximation issues;

• Gather and review activities / projects of third parties in this respect;

• Suggest recommendations and define possible next steps.

Stress was mainly laid on land-based transport and to a minor extent on maritime transport and civil aviation, as presently there are other TRACECA projects in implementation which already tackle related maritime and civil aviation issues.

The next subchapters describe in more detail the background and underlying principles as well as the approach and preliminary statements on review findings.

1

Present

Situation

2

Gap

Analysis

3 Dissemi-

nation, Commu-

nication, Infor-

mation and Coordination

4 Recom-

mendations

and

Further





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1.3 Review and analysis of the existing situation

1.3.1 Community guidelines for development of transport infrastructure

Within this important step, the approach used was to promote the main goals and tools of European Union policy towards the beneficiaries.

The ultimate policy objective of the EU is the establishment of a single, multimodal network covering both traditional ground-based structures and equipment (including intelligent transport systems) to enable safe and efficient traffic. Increasingly, it also involves the deployment of innovative systems that not only promise benefits for transport but also have substantial potential for industrial innovation.

On the basis of such defined objective of the EU policy, activities were focused on the description of the basic EU legal acts and on the explanation and a summary of the main objectives. Following topics were analysed:

• European Community guidelines for the development of the transport-infrastructure network;

• Trans-European networks: towards an integrated approach;

• Integration of the European transport-infrastructure network into the common transport policy;

• Intermodal transport: The Marco Polo II Programme;

• Intermodal transport: Intermodality of goods transport;

• Interoperability of the trains: European rail system; and

• Interoperability of the European air traffic management network.

Specific attention was given to the main definitions provided by legislation in order to create a common understanding of the fundamental concepts and contents. The necessity arose to proceed with the description of each one of the EU legal acts with its main objectives in details, stating also all the amendments and alterations chronologically in the following transport subsectors.

• road,

• rail,

• air,

• waterborne transport,

• positioning and navigation systems, and

• intelligent transport systems.

The description also contains the correlatives of some issues with other legal acts of the acquis communautaire system.

1.3.2 Questionnaire survey

In order to have a better understanding of the status-quo and to target new support measures more efficiently, the experts in cooperation with the Permanent Secretariat launched an questionnaire survey in two parts.

The first part of the questionnaire survey concentrates on international conventions and agreements for all modes of transport in the following fields:

• infrastructure,

• road traffic and signals,





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• road vehicles,

• other legal instruments related to road traffic,

• inland water transport,

• border crossing facilitation,

• dangerous goods,

• perishable foodstuffs, and

• wreckage and salvage.

The questionnaire survey is supposed to show the progress, during the last five years, in ratification and implementation by the TRACECA countries. The main focus is given to any impediments for implementation of conventions and indications about the reasons and whether it is envisaged to sign in the near future.

At the same time the questionnaire survey for the EU acquis communautaire was created. The purpose of the questionnaire is to collect information from the TRACECA member states covering the main principles in the EU legislation about objectives, priorities and broad lines of measures. The questionnaire is structured by the main components of the transport infrastructure. There are the following parts:

• Bi-lateral or multi-lateral agreements in the field of each component;

• Domestic legislation in this field;

• Competent state authority for implementation;

• Methodology for the involvement of the private sector; and

• Existing national plans and programmes with a view to develop the transport network.

Each objective has its own value in the research and the assessment of the improvement of the legal / regulatory framework and progress achieved in national transport policies in terms of legal / regulatory convergence and harmonisation with EC standards.

1.3.3 Review of existing country and regional strategy documents

The experts gathered and analysed the following strategy documents for approximation and harmonisation issues:

• Armenia: Transport Sector Development Strategy 2020, November 2008, financed by ADB Technical Assistance Special Fund, mainly Chapter 3.4 International transport facilitation conventions/agreements;

• Armenia’s Transport Outlook, Transport Sector Master Plan, ADB 2011;

• Azerbaijan: Strategy of Development of the Transport Sector of Azerbaijan - Republic Azərbaycan Respublikasının Nəqliyyat Sektorunun Đnkişafı Strategiyası;

• Azerbaijan: Transport Sector Development Strategy 2006 – 2016, financed by ADB, 2005;

• Bulgaria: Strategy for Development of the National Transport System of the Republic of Bulgaria until 2015, April 2005, chapter 4.3.3 approximation of transport legislation;

• Georgia: Contribution to the Transit Strategy of Georgia, June 2004 submitted to the World Bank;

• Georgia: Programme of the Government of Georgia 2008–2012, Georgia without Poverty;

• Moldova: Strategy land transport infrastructure for 2008-2017, approved Government Decision Number 85 from February, 2008;





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• Kazakhstan: TSRF Republic of Kazakhstan till 2015, approved by Presidential Decree from 11.04.2006, Number 86;

• Kyrgyzstan: Strategy for Development of Road Transport for the period 2011 – 2015;

• Romania: Sectoral Operational Programme – Transport (SOPT), 2007 – 2013, Ministry of Transport, Construction and Tourism;

• Tajikistan: Developing Tajikistan’s Transport Sector, Transport Sector Master Plan, ADB 2011, as no specific country related government strategy could be identified;

• Turkey: Transport Infrastructure Needs Assessment (TINA) for Turkey, final report 2003;

• Turkey: Transport Operational Programme, 2007 – 2009 relating to the papers on Transportation Master Plan Strategy (only excerpts), Ministry of Transport;

• Turkey: Turkey’s Programme for Alignment with the EU Acquis 2007 – 2013, Chapter 14 Transport Policy;

• Turkmenistan, no specific country related strategy was identified;

• Ukraine: Strategy for the development of seaports of Ukraine till 2015;

• Ukraine: Strategic Objectives for Transport, Communication and Road Facilities in 2009, Ministry of Transport and Communications of Ukraine, Kiev 2009;

• Uzbekistan: Transport Sector Strategy 2006 – 2020, financed by ADB – Japan Special Fund.

Concerning regional strategies, the following documents were reviewed:

• Multilateral Agreement (MLA) plus its technical annexes;

• All IGC decisions including appendixes;

• IGC TRACECA Long-Term Strategy;

• CAREC (Central Asia Regional Economic Cooperation) - Transport and Trade Facilitation Strategy, endorsed by the 6th Ministerial Conference, November 2007;

• BSEC (Black Sea Economic Cooperation) – Transport Action Plan;

• IRU - New Eurasian Land Transport Initiative (NELTI) - Final Report.

It can be stated that most chapters of the IGC TRACECA Long-Term Strategy require activities for harmonisation. In addition, most TRACECA national transport strategies have a paragraph referring to the strong will for increasing and improving international and multi-modal transport.

1.3.4 Legal recommendations from other TRACECA projects

Most TRACECA TA projects were either entirely or with certain tasks concerned with approximation of transport legislation and harmonisation of national transport policies.

The following project documents (latest progress reports placed on the TRACECA website or handed over to the IDEA experts) were reviewed and analysed, and follow-up measures identified. Where needed, contacts were established with relevant project staff and project counterparts.

• Analysis of Traffic Flows for TRACECA countries and Interregional Transport Dialogue between EU and NIS;

• Trade Facilitation and Institutional Support Project (all TRACECA countries);

• National Development of Coordinated National Transport Policies in Central Asia (Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan);





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• TRACECA Land Transport Safety and Security;

• Support to the preparation of the project strengthening transport training capacities in NIS countries;

• Strengthening transport training capacities in NIS countries;

• Improvement of Maritime Links;

• Motorways of the Sea for the Black Sea and the Caspian Sea;

• Common security management system;

• Training civil aviation administration and personnel;

• International Logistics Centres/Nodes Network Central Asia at the Republic of Kazakhstan, Kyrgyz Republic, Republic of Tajikistan, Republic of Uzbekistan and the Republic of Turkmenistan;

• International Logistic Centres for Western NIS and the Caucasus (Armenia, Azerbaijan, Georgia, Moldova and Ukraine;

• TRACECA Civil Aviation Safety, Security and Environment Project;

• Development of Equipment Certification Centres for the Transportation of Perishable Goods in Kazakhstan, Kyrgyz Republic, Tajikistan, Uzbekistan and Turkmenistan in the frame of ATP agreement;

• Regulation on the Transport of Dangerous Goods along the TRACECA corridor (Azerbaijan, Georgia, Kazakhstan, Turkmenistan and Ukraine).

EU-supported bilateral projects were also identified as highly relevant, and project reports were reviewed as follows:

• Armenian-European Policy and Legal Advice Centre, Assessment of Institutional Standing in the field of road and rail transport, February 2008;

• Support for the integration of Ukraine to TEN-T;

• Ukrainian-European Policy and Legal Advice Centre (UEPLAC), Regulatory impact analysis of approximation of the Ukrainian legislation with the EU acquis communautaire road transport for the Ukrainian road hauliers;

• TACIS Project, Accession of and/or implementation by Ukraine of international agreements and conventions on transport;

• Georgian-European Policy and Legal Advice Centre (GEPLAC), Policy Paper on Road Transport;

• Armenian-European Policy and Legal Advice Centre (AEPLAC), Assessment of institutional standing in the field of road and rail transport;

• Transport law and policy, Sectoral Law Approximation Guideline Law Approximation to EU Standards in the Republic of Moldova, Chisinau, November 2010.

Common to all of them is that they either have a direct relation to the implementation of legal and policy harmonisation measures, international standards and conventions such as the Perishable Goods project in Central Asia, or an indirect relation with some related specific tasks.





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2. Identification of priority sub-sectors and activities

2.1 General principles and methodology

2.1.1 The approximation / approximation process

Transport systems worldwide are undergoing rapid change. Globalisation has created a demand for goods and services that makes improved infrastructure and more efficient transport systems a precondition of economic development. Appropriate transport costs, timely delivery and the quality of service are essential factors for improving the competitiveness of exports and thus contributing to the welfare of the TRACECA countries.

Experience shows that countries adhering to international standards and having a harmonised, integrated and interoperable transport system correspond best with above factors. In principal, the approximation / approximation process consists of three major stages:

• Transposition of the international standards and European acquis communautaire in the transport sector into the national legal system by using the appropriate national procedures and mechanisms (often laws passed by the Parliament, sometimes Presidential, Governmental or Ministerial Decrees and other normative acts);

• Implementation, by providing the institutions, budgets and implementing necessary to carry out the laws and regulations;

• Enforcement, by providing the necessary controls and penalties to ensure that the law is being complied with fully and properly.

Furthermore, as already outlined in Chapter 1.1 any legal transport framework relates to four principal sub-topics:

• Technical standards;

• Institutional standards;

• Non-physical barriers;

• General framework conditions relating to investments and concessions.

Having carried out activities given in Chapter 1 of this report, such as review of documents, analysis of the answers to the questionnaire survey, desk top research and interviews with selected stakeholders, the following chapters present the findings and conclusions drawn. They are given according to above topics and processes per TRACECA country.

However, the experts refrained from taking all TRACECA countries into account:

• Afghanistan is still a candidate country and is presently not yet in the focus of the TRACECA programme;

• Turkmenistan did not yet sign the MLA and hardly any information and documents are available to the Consortium;

• Iran as new member country since 2009 has not been taken into account, as there are yet no projects and other documents within the TRACECA library.

In order to have a clear and easy understandable view on findings and conclusions, a “signalling” system in the style of traffic lights is used as shown in the graph below.





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The colours indicate the following conclusions:

= very limited compliance with international standards with regard to the legal framework, its implementation and enforcement;

= change process towards international standards has started but implementation and enforcement is still in its infancy;

= change process has started and is gaining momentum, but there is still room for improvement in implementation and/or enforcement;

= minor further change processes required concerning the legal framework, implementation and/or enforcement;

= full compliance with international standards with a view to the existing legal framework, its implementation and its enforcement.

In all cases where there is not enough information available to the experts or where additional studies would be required in order to be able to give a validated expert opinion on a certain topic, the “signalling” system shows the white colour:

For the time being and as there are on-going EC-supported TRACECA projects in the civil aviation and the maritime sector, the experts concentrated its further analysis on land-based transport modes – road and railway.

2.1.2 Feedback on the questionnaire survey

Answers were presented from the following countries: Azerbaijan, Bulgaria, Kazakhstan, Kyrgyzstan, Romania, Turkey and Ukraine. For Armenia and Moldova, the experts based their work on available reports for legal approximation in the field of transport.

Regards the international conventions and agreements, the importance was stressed to explain the impediments against a legal, institutional and regulatory system transport approximation respectively against signing or implementing any international conventions and the interviewees were thus asked to properly fill out the last two columns of the Questionnaire on International Conventions – to indicate the status of implementation and any impediments against its implementation and the reasons in case the country did not sign or probably envisaged to sign in the near future.

On the basis of the survey regarding the components of the transport network, the IDEA experts were able to identify the range of national legal regulations in each component of TEN-T policy that regulates the matter as well as the competent national authority.

Deep analysis of domestic legislation of each one of the countries in TRACECA was out of the task, but is highly recommended in the future to identify the necessity of measures and steps for laws and sub-laws which have to be adopted, amended, supplemented or abolished in order to reach a common base/compliance with the regulation, directive or decision compared. It should be noted that adaptation to a directive, regulation or decision might involve several legal acts. Where the adaptation makes it necessary to adopt, amend, supplement or repeal a law and its implementing regulations, it is necessary to submit





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legislative proposals on both the law and implementing regulations even if the latter's entry into effect is expected at a later stage.

2.2 Technical standards for enhanced interoperability

The transport network must be combined with measures that will assure interoperability with no journey delays for passengers and freight. To improve interoperability encompassing all integral elements of the transportation system (transport modes, interfaces and infrastructure).

In transport, the term “interoperability” refers to the administrative, technical and organisational compatibility of the transport systems within and among the countries for the mutual satisfaction of transport traffic in a way that eliminate the barriers to uninterrupted network access and fast cross-border procedures. These are complementary policies affecting, by definition, all possible methods and modes of transportation. Interoperability can be considered as a prerequisite for intermodality because of its influence on the quality of the transport system as a whole.

Talking about technical standards for interoperability on the TRACECA Corridor, the importance of compatibility of the transport systems needs to be underlined. Such mentioned aspect means that standardisation activities need to face telematics and automated systems related to the modern criteria for designing and operating infrastructures for intermodal and, in particular, combined transport: intermodal terminals, container terminals, logistics centres (freight villages), related handling systems, innovative techniques for modal change, including those for the transport of complete road vehicles, using roll-on roll-off techniques (rolling road). The standardisation activity would even include telematics and automation for designing and projecting modern interoperable railways lines, including both infrastructure aspects and rolling stock, as well as the technological equipment of lines and trains.

Most technical requirements for road infrastructure standards refer to a network which shall guarantee users a high, uniform and continuous level of services, comfort and safety. They refer to such parameters as classification of international roads, geometric alignment characteristics, cross-sections and junctions, number and width of lines, intersections with railways, vertical signs and road markings, fences and barriers, traffic control, emergency communication, road lighting, safety of pedestrians and cyclists, rest areas, frontiers posts, toll areas, road side inspection of vehicles, environment and landscape and last but not least maintenance aspects.

Most technical requirements for road vehicle standards aim at creating a level playing field and to improve road safety and protect the environment. Standards on the dimensions and the weights of trucks and buses are the main key in this respect. For TRACECA countries this is a point of interest, especially given the deteriorated vehicles operated in the domestic markets.

Using the “signalling system” described in above item 2.1.1, the findings of the questionnaire survey regards the level of approximation with the international standards in the road sector could be illustrated for separate parties of the MLA:





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Table 1: Technical Standards - Road Sector

Country Infrastructure standards

Vehicle standards

Azerbaijan

Armenia

Bulgaria

Georgia

Moldova

Kazakhstan

Kyrgyzstan

Romania

Tajikistan

Turkey

Ukraine

Uzbekistan

In rail transport the picture is more mixed because the main hindrance to interoperability are the different gauges in former Soviet Union and Western countries.

In principal, the rail network shall offer users a high level of quality and safety, by virtue of its continuity and of the gradual implementation of its interoperability, which shall be brought about in particular by technical harmonisation. ERTMS harmonised command and control system recommended for the European railway network would also be a long-term vision for the TRACECA corridor.





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Rail infrastructure parameters are for example: high-speed geometric parameters, vehicle loading gauges, nominal minimum speeds, authorised mass-per-axle for locomotives and wagons, bridge design, maximum gradients, station design and lengths, tunnel envelopes, level crossings.

Table 2: Technical Standards - Rail Sector

Country Rail infrastructure and systems

Combined transport and multi-modal transport intersections

Azerbaijan

Armenia

Bulgaria

Georgia

Moldova

Kazakhstan

Kyrgyzstan

Romania

Tajikistan

Turkey

Ukraine

Uzbekistan

In order to be able to guarantee an efficient and expeditious flow of transport, necessitated by modern methods of production and distribution of goods, international combined transport services should fulfil certain requirements such as capability of carrying all types of standard





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containers and other loading units, high transport speed, direct trains, suitable and sufficient equipment and infrastructure capacities. To meet these requirements, trains and infrastructure should meet minimum standards for the performance parameters of trains such as minimum speed, lengths, axle loads and weight; minimum standards for terminals, intermediate stations, border crossing points, gauge interchange stations and, last but not of least relevance for TRACECA, port / ferry terminals. However, it is not just a question of minimum standards, but also of transport infrastructure and vehicle capacities.

2.3 Institutional standards

According to international standards and EU Aquis Communautaire, there is a basic structure for the functioning of the transport sector, as illustrated in the following picture:

The transport sector of all OECD-countries, e.g. Australia, Belgium, Canada, Denmark, France, Germany, Greece, Japan, Spain, UK and USA, complies with this basic structure.

For TRACECA countries, inheriting the Soviet Union institutional structure in which decision-making for all those transport sector functions was concentrated more or less within one entity, the challenging task is unbundling policy making, executive respectively regulatory functions and operating functions. Furthermore, it is most important to open up transport markets (infrastructure planning, construction and transport operations) to competition in the sector with regard to a fair levelled playing field between and within transport modes. When talking about a fair level playing field, we refer e.g. to road-user charging system, free access to rail network, or the introduction of public service obligations to compensate public transport companies for political or social obligations.

Civil/Company law

(shareholder is the state or the state

and a private investor or a private

investor only)

Constitutional/Ad-

ministrative/public

law

Administrative/public law

or

civil/company law

Budgeting and taxes

according to fiscal and

transport sector related

policy priorities

Profit & loss accounting

balance sheets

(possible deficits or profits

covered by owner of shares)

Policy

functions Executive functions Operational functions

Fees/Charges and

expenditures for provision

of required services

(possible deficits or profits covered

by State budget or owner of shares)

Government

officials and

civil servants

Civil servants

and/or

employees

Employees

Policy

functions

Executive

functions

Operational

functions

Ministry of

Transport

Transport

Agencies

Transport

Companies





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All TRACECA countries have started this challenging and complicated change process with varying efforts, commitment, dedication and pace. The above picture illustrates the main policy, legal and economic parameters to be tackled in this process:

The policy basis for above issues in the EC member countries are mainly the white paper European Transport Policy for 2010 – time to decide; the Communication – Greening Transport from 2008 and partly the latest white paper 2011 Roadmap to a Single European Transport Area – Towards a competitive and resource efficient transport system.

Furthermore, there are various EC legal documents such as the Regulation (EC) No. 1370/2007 of the European Parliament and of the Council of 23 October 2007 on public passenger transport services by rail and by road and repealing Council Regulations (EEC) No. 1191/69 and No. 1107/70 or the 85/383/EEC: Commission Decision of 10 July 1985 relating to a proceeding under Article 2 of Council Regulation (EEC) No. 1017/68 applying rules of competition to transport by rail, road and inland.

Table 3: Institutional Standards - Road Sector

Country Unbundling of functions

Private road construction and

maintenance

Non-discriminatory, fair and efficient

road user charges

Non-discriminatory market access for

operators

Azerbaijan

Armenia

Bulgaria

Georgia

Moldova

Kazakhstan

Kyrgyzstan

Romania

Tajikistan

Turkey

Ukraine

Uzbekistan





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On the basis of the review of country strategies and project documents and of desk research, and having above background in mind, the above table illustrates the state of compliance with those institutional standards first in the road sector and the below table in the rail sector of the individual TRACECA countries.

Table 4: Institutional Standards - Rail Sector

Country Unbundling of functions

Free access to rail infrastructure

Non-discriminatory, fair tariff system

PSO schemes

Azerbaijan

Armenia

Bulgaria

Georgia

Moldova

Kazakhstan

Kyrgyzstan

Romania

Tajikistan

Turkey

Ukraine

Uzbekistan

As a conclusion, it can be stated that in the road sector there is still some room for improvement concerning the institutional standards, related mainly to harmonisation of the charging and licensing system. In the rail sector, approximation with international standards is just in its infancy in most TRACECA countries. This is particularly critical because it deprives the railway companies of the potential to encounter the trend towards a major shift in the modal split from rail to road transport.





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2.4 Legal framework relating to non-physical barriers and standards

The problems of non-physical barriers and the alignment and harmonisation of non-physical standards are extensive, deeply rooted and inherently difficult to come to grips with. They have been observed since the beginning of the TRACECA programme, and different sub-topics were addressed in various working groups and projects.

Non-physical barriers and standards are increasingly important because transport and distribution-related activities, once considered secondary to production, are now being integrated. This process starts with the collection of raw materials and ends with distribution and delivery of the manufactured product to the final consumer anywhere in the world. Thus, the objective of removal of non-physical barriers and of harmonising non-physical standards is improving reliable, time-definite, door-to-door, freight-forwarding and multi-modal transport services.

When talking about non-physical barriers, we refer to those non-technical and non-institutional barriers to trade which to a large degree are “man-made”. These are for example:

• Protracted customs procedures at border crossing points, which significantly increase waiting times for vehicles among others often requiring sealed transit containers to be opened;

• Non-harmonised transit tariff across the TRACECA countries often despite of signing of international and bilateral agreements;

• Restrictive migration rules such as the visa regimes and times drivers are allowed to stay in a certain country.

The following lists legal frameworks where non-physical barriers are addressed:

a) International agreements

There are some key UNECE legal instruments that, if properly implemented, would significantly contribute to a smooth functioning of the TRACECA Corridor.

These instruments include three agreements that establish common technical parameters for major rail, road and combined transport infrastructure networks (AGR, AGC, AGTC), nine agreements related to road transport, two agreements on border-crossing facilitation, and two legal instruments pertaining to dangerous goods and special cargoes. However, it does not specify any time limits concerning the implementation of harmonized technical standards. Given the relatively recent acceptance of the TRACECA countries and the huge amount of investment that would be required for the adaptation of their track and structure gauges to AGC standards, full technical interoperability can be achieved only in the very long run. Nevertheless, it is possible to minimise border-crossing times by adopting specific measures to address differences in the gauge and other technical parameters. Such measures include transhipment of containers, use of rolling stock with gauge-adjustable bogies and other special devices.

To overcome the obstacles mentioned above through productive investment, a planning process on an international scale is called for. Policy makers in TRACECA countries ought to assure that national investment programmes are compatible with a coherent development of the land transport routes that have been agreed to date. In the countries with relatively mature legal systems and competitive markets, the authorities might want to consider long-term concessions and other forms of public-private partnership to finance the most urgent infrastructure projects. In most TRACECA countries, however, such projects may have to be financed or guaranteed by the government. Whenever





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possible, such publicly financed projects ought to utilise competitive tenders to assure the provision of adequate infrastructure at least cost.

b) National legislation

National legislation is not part of the investigation. However, the IDEA experts found good-practice examples for gap analysis in Armenia, Moldova and Ukraine. In different TA projects the countries have good gap analyses especially for legal approximation containing deep studies on all modes of transport.

During the survey the experts identified the area of national laws concerning the elements of transport infrastructure and the tools for it development – concessions, PPP, BOT, etc. While the aim of the policy is approximation of infrastructure legislation, there are recommended similar studies and gap analyses to be held in the relevant law area.

c) Implementation and enforcement rules and procedure

The next step in the process is implementation and enforcement. In principal it can be stated that, whatever is the requirement (physical, social, non-physical; institutional), it may only be deemed to be implemented if there exists an effective system of control and enforcement. Thus, this topic is as important as international agreements and national legislation. However, the experts can base any judgements only on third party studies, analysis and assessments and some own observations and interviews undertaken in the framework of other projects in the region. These do not give a very encouraging picture, as implementation and enforcement often lack very much behind the ratification and parliamentary approval processes.

A first reason might be the dispersed responsibilities for ratification, implementation and enforcement. A second bottleneck are the many governmental entities involved such as Ministry of Transport (and there within several ministerial departments and agencies), Ministry of Foreign Affairs, Ministry of Interior and Ministry of Finance.

Besides having a bird-eyes view on the

• status of ratification and adherence to international conventions and agreements,

• enabling national legislation reflecting approximation to international standards,

• appropriate and prompt implementation and enforcement rules and processes,

the expert team analysed in more depth two more of main non-physical topics important for the efficient transport and transit performance of the TRACECA countries – as below.

d) Harmonisation, simplification and standardisation of transit procedures and documentation

This topic relates to the efficiency of the clearance process (i.e. speed, simplicity and predictability of formalities) by border control agencies, including customs authorities. It plays a critical role in improving transit systems and contributes a considerable share to the transport costs of goods and passengers. The long-term goal in this respect is certainly the region-wide application of the one-stop border post and standardised e-documents.

All the TRACECA states participated to the Customs Convention on Containers (Geneva, 2 December 1972) and the International Convention on the Harmonization of Frontier Controls of Goods (Geneva, 21 October 1982).

The reports show that national measures for better implementation still have more capacities to improve the simplification and standardisation of cross-border procedures and transit documentation.





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e) Transport of specialised goods (mainly perishable and dangerous goods)

The European Agreement concerning the International Carriage of Dangerous Goods by Road (ADR) was signed in Geneva on 30 September 1957 under the auspices of the United Nations Economic Commission for Europe (UNECE), and entered into force on 29 January 1968. This agreement was modified (Article 14, Paragraph 3) in New York on 21 August 1975, though these changes only took effect on 19 April 1985. A set of new Amendments entered into force on 1 January 2009, and consequently, a consolidated restructured version was published as document ECE/TRANS/202, Vol. I and II (ADR 2009). Most recently on 1 January 2011, a new set of amendments became effective.

The main purpose of harmonising the legal framework for the transport of dangerous goods is to facilitate its transport, to enhance road safety and to set common standards of requirements for vehicles, training of staff, packages, marking and labelling, and last but not least classifications of dangerous goods. In the European Union, countries, that have undersigned for instance the ADR Agreement and implemented the related EU legislation, recognise foreign-plated vehicles which are approved in their native countries or in other EU member states. They are obliged to use the common classification of the dangerous goods. These provisions facilitate the international trade and transport of dangerous goods in the Union but also transport from EU member states to non-member states.

The agreement on the international carriage of perishable foodstuffs and on the special equipment to be used for such carriage (ATP) was drawn up by the Inland Transport Committee of the UNECE and presented in Geneva on September 1, 1970. It entered into force on November 21, 1976. In order to take into account the technological evolution, this agreement and its annexes have been regularly amended and updated since their entry into force by the Working Party on the Transport of Perishable Foodstuffs (WP.11) of the Economic Commission for Europe’s Inland Transport Committee. The ATP establishes harmonised and improved technical conditions for the preservation of the quality of perishable foodstuffs during their carriage. These conditions concern mainly the temperature to be observed during the carriage and the equipment used for the carriage. The ATP establishes the appropriate temperatures under which the various types of perishable foodstuffs should be carried. It also lays down the equipment requirements, including its refrigerating capacity, insulating capacity and efficiency of thermal appliances as well as methods and procedures for measuring and checking them.

Countries which are located on the TRACECA Corridor and have not yet signed the ATP agreement are Armenia, Georgia, Kyrgyzstan, Iran, Turkmenistan and Tajikistan. Turkey participates since 22 February 2010.



Working paper on approximation of transport legislation and harmonisation of national transport policies

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Table 5: Legal framework relating to non-physical barriers and standards

Country Ratification and adherence to major international

conventions and agreements

Enabling national legislation

Effective implementation and system of controls and

enforcement

Simplified and standardised transit and cross-border

procedures and documentation

Transport of specialized goods (perishable goods,

dangerous goods)

Azerbaijan

Armenia

Bulgaria

Georgia

Moldova

Kazakhstan

Kyrgyzstan

Romania

Tajikistan

Turkey

Ukraine

Uzbekistan





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2.5 Legal framework relating to the attraction of additional investments

IDEA experts have undertaken investigation and analysis of the legal framework for attracting investments in addition to the national transport sector budgets, i.e. mainly via enabling various forms of private-sector participation in the transport sector. Some findings are briefly discussed below on a selected country-by-country basis.

There is an acute need for adoption of a special law to unify, codify and harmonise the legal framework of PPP in Bulgaria. A specific PPP law has been discussed and will be specially created by an agency in the Ministry of Finance. For transparency there will be a responsible public register of PPP. Government departments are responsible for private sector infrastructure procurement:

A public-private partnership law (Nr. 179-XVI dated 10.07.2008) was implemented in Moldova and a Public Private Partnership Direction within the Public Administration Agency has also been implemented. Currently, the government does not have a great deal of experience with PPP. The government adopted amendments in the Concession Law, Investments in Entrepreneurship Law to promote PPP entered into force on 3 September 2010.

The attraction of investments from the private sector has been stated as a key priority by all Ukrainian Governments. Concessions are regarded the most attractive way to implement large scale long-term infra-structure projects in Ukraine. In private procurement there is no rigid, statutory system. However, from a practical point of view the easiest option for creating a procurement system in the private enterprise is the existing legal framework governing the procurement field.

In Turkey, a corridor approach will encourage the utilisation of maritime and railway transportation networks, and priority will be given to the implementation of PPP models in the construction and operation of large transportation projects. There is no responsible agency for private sector participation. Turkey’s investment legislation is simple and complies with international standards, while treating all investors equally.

In Azerbaijan, the Ministry of Transport has been the owner of transport projects using construction firms from the private sector and often private financial institutions too. Azerbaijan Export & Investment Promotion Foundation (AZPROMO) is a private public partnership established by the Ministry of Economic Development of Azerbaijan

Public-private partnerships in the transport sector have made relatively little headway in Georgia; they exist in ports and airports, but not in road sector. The Georgian National Investment Agency is responsible for the state promotion of investments. The Agency has the right to represent the relationship of administrative agencies and other entities to investors.

Basic PPP models, implemented nowadays in Kazakhstan, are concession, “build-finance-operate” model and establishment of so called Social-Entrepreneurial Corporations (SECs). The first law “On concessions in the Republic of Kazakhstan” was adopted on December 23, 1991 to regulate administrative, economic and legal environment concession agreements in Kazakhstan for foreign investors. This move followed amendments introduced in July 2008 to the Concession Law of Kazakhstan, which had been adopted in July 2006. . At present, a multitude of regulative and legislative acts on PPP aspects exist in Kazakhstan. In August 2008 Kazakhstan established its specialised PPP unit called Kazakhstan Public-Private Partnership Centre (Decree No. 693 of 17th July 2008 of the Government of the Republic of





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Kazakhstan “Concerning the Formation of a Specialised Organisation for Issues of Concessions”).

In Kyrgyzstan, the Ministry of Economic Regulation is now working on the draft law on a PPP that is to replace the existing PPP law that turned out to be ineffective. There is no specific agency responsible for PPP and the function of agency for private sector infrastructure procurement is done by the Government of the Kyrgyz Republic or local government.

Over recent years, the President and Government of Tajikistan have expressed a political will to facilitate private sector involvement, including by Public Private Partnerships, in order to implement investment projects. The Civil Code, Law on Concession and Law on Leasing must be considered during this process. At present, no agency is specifically responsibility for private sector infrastructure procurement.

The strength of legislation and its promoters has been plotted on the below table for most TRACECA countries.

Table 6: Strength of PPP legislation and promoters in the TRACECA region

>>> Legislation >>>

>>

> P

rom

ote

r >

>>

TUR

GEO

AZR BUL KAZ

UKR MLD

KYR TAJ

Generally, it is the former Soviet Union republics which show the lowest degree of PPP strength. Kazakhstan represents an exception as it constitutes, together with Turkey, a large and important transit country. Georgia, as another important transit country, also shows some strength in PPP project implementation.





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Following brief illustration rates the laws governing different kinds of PPPs based mainly on EBRD assessment of concession laws in its member countries, with adaptations by additional findings of above-mentioned activities within the IDEA Project. An additional column refers to the practical experience because governments may have decided to realise transport infrastructure projects with private sector participation (PSP) in any mode of transport, even if there are no explicit concession laws or if other important issues of legal framework might be missing or are just regulated for sectors other than the transport sector,.

Four principal PPP financing structures exist for the management / development of PPPs:

a) Leasing model: a property holding company takes care of the planning, implementation and financing of the ILC investments and then leases the entity to the state against a constant leasing rate. The government is responsible for the management of the ILC.

b) Operator model (DBOT): the government grants a license to a private company or consortium for the implementation of infrastructure investments. The private company finances, designs and builds the investments, but the ownership is still with the state. During operation, the private company is paid by the state until the license has to be given back to the state.

c) Concession model: the government tenders a certain infrastructure investment and grants the concession to an operator allowing the winning bidder to directly charge the users of the investment.

d) Project-based financing: the stakeholders of a project found a common project company mainly in the form of a joint venture which is the debtor for the required capital and which operates and maintains the business.

Table 7: Summary of potential PPP financing structures

PPP financing structure

Leasing DBOT Concession Project-based

financing

Ownership Company Government Government Company/JV

Private partner’s status Owner Licensee Concessionaire Owner

Planning, implementing, financing

Company Company Gov and Company

Company/JV

Management Government Company Company Company/JV

Private return derived from Rent from Government

Fee from Government

Profit from operation

Profit from operation

International standards are for example UNCITRAL (United Nations Commission on International Trade Law), EBRD – Core principles for a modern concession law, OECD Basic Elements of a Law on Concession Agreements and last but not least, the EU Communication on the application of Community Law on Public Procurement and Concessions to Institutionalised Public-Private Partnerships.




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Table 8: Legal framework for concessions

Country General Policy and Concession Legal

Framework

Definition and scope of the

Concession Law

Selection of Concessionaire

Project Agreement Security and Support Issues

Settlement of Disputes and

Applicable Law

Practical Experience in

Transport

Azerbaijan

Armenia

Bulgaria

Georgia

Kazakhstan

Kyrgyzstan

Moldova

Romania

Tajikistan

Turkey

Turkmenistan

Ukraine

Uzbekistan






3. Conclusions and recommendations for further actions

3.1 General observations, constraints and conclusions from the review phase

Not surprisingly, an exception from the general mixed picture are the EU member countries Bulgaria and Romania which, over more than one decade, placed a lot of effort combined with high political attention, commitment and willingness. Meanwhile, their transport infrastructure, transport systems and transport sector management is highly adapted to EU and international standards thus ensuring smoother, efficient, safer and more secure flow of goods and passengers on all transport modes.

Turkey as a candidate country is presently in this accession process of adoption of the aquis communautaire and improving its transport infrastructure. Particularly its very active road transport and forwarding industry is advanced compared to all other TRACECA countries.

Generally spoken, it can be stated that the EU neighbouring countries have aligned their legal basis, implementation and enforcement mechanisms with EU standards, or at least they have taken concrete measures in such direction.

A summary by region and criteria reveals that enactment and enforcement of transport legislation is relatively strong in Southeast Europe and becomes ever weaker towards the South Caucasus and Central Asia.

Table 9: Enactment and enforcement of transport legislation in the TRACECA region

Region / Criteria Country

Technical standards

Institutional standards

Non-physical barriers

Attraction of investment

Road Rail Road Rail Legislation Control Legislation Control

South

east E

uro

pe

Ukraine

Moldova

Romania

Bulgaria

South

Caucasus &

T

urk

ey

Turkey

Georgia

Azerbaijan

Armenia

Centr

al A

sia

Uzbekistan

Kazakhstan

Kyrgyzstan

Tajikistan

In general, it can also be stated that throughout the TRACECA region know-how on the general concept and overall essence of the implications of transport-related legal and policy harmonisation is rather dispersed or even missing at all. An aggravating factor surely is the fact that transport training institutes and academies in the TRACECA region do not have specific curricula for teaching international standards and legislation. In many cases they do not even possess the texts of the respective international conventions and legislation. Furthermore, it could also be derived that know-how of enforcement staff is not satisfying in






many aspects of enforcement and control. This lack was proven, for example, during data collection for NELTI and for the TRACECA route attractiveness index TRAX.

Investment in human resources development is recognised as one of the most fundamental and cost-effective factors contributing to economic growth. Countries should consider regional cooperation in this context and the IGC TRACECA Permanent Secretariat could play a major role in this development.

Some good practices were identified during the study at both national and international level by the questionnaire survey:

• As good practice on national level, the IDEA experts could show the Law No. 203/2003 regarding the construction, development and modernization of national and European interest transport network of Romania. The law itself was not analysed during the present study, but it presents the main desire of the state to stress on the transport network as an object of national and international interests.

• On international level, a good example is given by Ukraine ratifying the Convention concerning International Carriage by Rail of 9 May 1980 (COTIF) and its Protocol of 3 June 1999 for modification of the Convention. Although the Ukraine is a member of OSJD (as Bulgaria and Rumania are), we stress this fact because some member countries to OSJD excuse themselves for non-participation to COTIF based on that reason.

The questionnaire survey questionnaire also contained two important requests: to indicate any impediments for implementation of international conventions / agreements and, in case the country did not sign, to indicate the reasons. Unfortunately, none of the respondents gave any more details on this matter. There is a need for a detailed study regards the level of national measures for implementation and enforcement of international conventions and agreements.

At present, the readiness of the TRACECA countries for close cooperation in transport operation could be taken as a general conclusion. Development of the transport infrastructure should be a medium-term perspective because of funding.

TRAX also uncovered some deficiencies in this respect by reflecting the resistance a route has from the perspective of a freight forwarder. TRAX revealed that the Trans-Caucasus route, compared to the Trans- Russian and Trans-Turkey routes, is by far the least attractive one based on the general index, but also based on each of the three evaluation criteria: travel cost, time cost, and reliability. In particular, the time-cost criteria going through the Caucasus territories decrease the attractiveness of this route to almost half of the Russian or Turkish routes. In this case, the low attractiveness of the Trans-Caucasus route is debited to long waiting times at border crossings5, of which this route has a larger number than the two other routes north and south.

There is a long-term perspective for the TRACECA Corridor: the implementation of intelligent transport systems. Intelligent mobility describes a joined-up approach to development and management of highly effective transport systems involving transport management, infrastructure, mobile communications and logistics. Innovation will help to make transport more sustainable, which means efficient, clean, safe and seamless. New infrastructure cannot solve all transport problems of congestion and emissions, but TRACECA could address this issue in order to improve efficiency, save money and reduce carbon emissions. There are opportunities for collaboration with higher education institutions, research bodies and industry to ensure the goals.

Having in mind the above findings and conclusions, the IDEA experts elaborated recommendations on implementation support, and a short set of activities to assure integration of TEN-T and TRACECA.

5 Transport corridors are defined from a physical perspective, as a collection of stretches “constructed from the transport

networks of adjoining countries and bounded by gateways”, which mainly are the border-crossings points.






3.2 Recommendations on implementation support

In the following are three specific recommendations drawn from the above findings and conclusions.

3.2.1 International Conventions

Initially, sufficient implementation and enforcement capacity needs to be created or strengthened in the responsible entities within the TRACECA region. Subsequently, multiple parallel steps could be quickly taken in order to consider and apply all conventions:

• Review responsible entities for enforcement per TRACECA country and assess their present training and their future training needs, and set up and implement a training scheme (train-the-trainers) based on above findings;

• Establish a permanent TRACECA expert group (with participants mainly from the Ministry of Transport and Ministry of Foreign Affairs) under patronage of the Permanent Secretariat IGC TRACECA;

• Draft criteria and specifications for projects of common interest on infrastructure interoperability;

• Agree to a coordinated program within the TRACECA region to accede to the conventions;

• Define the technical assistance (and its provider) that might be needed or useful for accession and application;

• Define investment needed and identify sources to support enforcement;

• Review domestic legislation within the TRACECA region for conformity with the conventions;

• Revise domestic legislation to conform to best practice and draft normative acts as an improved basis for enforcement of international conventions and law in case of need.

Medium to long-term recommendations should bring the TRACECA MLA in line with latest EU policy referring to the TRACECA Corridor as EU’s south-eastern axis:

• Initiate common activities of TRACECA institutions with the existing TRACECA countries’ policy and legal advice centres with the aim to increasing the knowledge among stakeholders about the general concept and overall essence of the aquis and international conventions;

• Review national legislation, regulations and practices to verify that they do in fact conform with the conventions to which they are adherents, or shortly expect to become adherents;

• Investigate impacts of latest EU decisions, communications and other acts related to the TRACECA on MLA provisions and discuss with TRACECA stakeholders and preparation the respective IGC decision or eventually envisage a MoU between TRACECA and EC;

• Investigate willingness to elaborate and adopt a technical annex for construction, development and modernisation of common interest transport infrastructure network;

• Adhere to all of the conventions, and apply as and when the enforcement capacity and minimum necessary regional economic development allows.

Knowledge management referring to the status of application of international transport law / aquis communautaire should be improved by the following:

• Disseminate best practice examples of institutional restructuring and impact assessment within the TRACECA countries;






• Carry out assessment and impact studies6 per TRACECA country (excluding Bulgaria and Romania because they adopted already EU Aquis, and Turkey because this country is frequently monitored by EC because of its Accession Status).

Continuing international assistance with training in application and enforcement, and possibly the provision of enforcement equipment, would accelerate the process. Familiarisation and training should include officials from transport ministry and enforcement agencies such as traffic police as well as custom authorities, plus academics and key stakeholders from the private sector.

3.2.2 Bilateral and multilateral agreements

Legal harmonisation tasks need to be institutionalised on the TRACECA level. It is therefore recommended that all TRACECA member countries agree and confirm that multilateral transport agreements are the primary international engagements for cooperation and harmonisation of regulation. Consensus on this would then allow a review of the present portfolio of agreements, and decisions on their roles in coordinated regional transport development. Following multiple parallel steps are recommended:

• Establish a legal database within the Permanent Secretariat IGC TRACECA;

• Establish a TRACECA legal working group on a permanent (and not anymore on ad-hoc) basis;

• Provide human resources and budgets to maintain working contact between countries on a multilateral basis;

• Establish agreements that provide working rules for government officials and transport operators;

• Negotiate new agreements or make amendments to existing ones in response to technical development and commercial prospects in the region and cross-referenced with the existing framework of multilateral engagements;

• Rescind superfluous agreements;

• Apply agreements, and regularly review their effectiveness in satisfying commercial demand for their signatories.

3.2.3 Facilitation of border crossing

The Trans-Caucasus route is not very attractive due to long waiting times at its numerous border crossings. Major stakeholders suffering from these delays are the trucking companies and freight forwarders; private participation in border-crossing improvement should therefore be encouraged. Also public-sector agencies are negatively affected, as railway transport is almost entirely in public hands and many freight forwarders are semi-public companies. Key stakeholders naturally and foremost are the Ministry of Transport (or Railways in some TRACECA countries), but also the tax and customs departments within the Ministry of Finance. Major recommendations to focus on border-crossing issues and to improve the mentioned problems are the following:

• Establish an experts group consisting of delegates from key private and public stakeholders (Ministry of Transport, Ministry of Foreign Affairs for international agreements, Ministry of Interior for enforcement, Ministry of Finance for tax, VAT and customs issues) under patronage of the Permanent Secretariat IGC TRACECA;

• Invite private participation (e.g. customs brokers, information service providers);

• Monitor the actual delays at border crossings. This should be an objective joint exercise by trucking companies, rail operators, customs, and users (e.g. freight forwarders, customs brokers);

6 Experience shows that resources required for such a study would be one international expert for 35 person-days, one or two

country experts for 60 person-days, which amounts to about Euro 65,000 per transport sub-sector (road, rail) and country.






• Quantify and identify the cause of these delays;

• Develop remedial measures for administrative and technical delays identified;

• Automate (computerise) as far as possible all administrative and technical control processes with the aim to reduce errors and opportunities for corrupt practice;

• Propose investment for infrastructure improvements.

3.3 Next activities

The IDEA experts recommend following activities to assure integration of TEN-T and TRACECA:

• Disseminate, debate and coordinate recommendations with DEVCO, Permanent Secretariat IGC TRACECA and other stakeholders;

• Identify means, responsibilities and methods for implementing recommendations;

• Extend legal and policy harmonisation activities to other modes of transport and more technically advanced systems such as traffic management systems and positioning and navigation systems.






Published June 2011

This publication has been produced with the assistance of the European Union. The contents of this publication are the sole responsibility of

TRT Trasporti e Territorio in association with its Consortium Partners Alfen Consult GmbH, Dornier Consulting GmbH and PTV AG,

and can in no way be taken to reflect the views of the European Union.