RZD’s international projects include developing a unified strategy to grow Central Asian railways

Interview with Jean-Pierre Loubinoux, Director General UIC

Around 300 participants attended the second edition of the UIC Global Freight Conference in St Petersburg in July. Organised by the International Union of Railways (UIC) and Russian Railways (RZD), the two-day event addressed all strategic issues of freight development, focusing on management, products and international corridors and aimed to develop and promote exchanges and partnerships between all major stakeholders.

Railway Pro:
Who attended the event and what were the highlights?

Jean-Pierre Loubinoux: The event was attended by over 30 countries not only from the CIS countries but Europe, Asia, the US and Middle East. The event also welcomed other players such as the World Bank and the United Nations to enlarge the presence of partners from different horizons. The event was also a success because it was attended by many top decision makers such as Vladimir Yakunin and Vadim Morozov, president and first vice-president respectively of RZD, as well as representatives of major operators such as Deutsche Bahn, SNCF (France), OBB (Austria), RCA and SBB (Switzerland). The role of the UIC is to bring all these concerned actors and institutes together to anticipate the future to ensure the network is in a strong position to react.  Our mission is to offer a forum where competition is put aside in favour of open debate and discussion. We have a great interest in the strategic development of international transport, and therefore RZD, which plays the role of a landbridge on the main East–West and North–South routes, is of great interest to us, as well.  Cooperation with Russia is absolutely vital since it’s impossible for rail freight to bypass this nation. Here RZD is being extremely constructive in developing the freight market and international
cooperation between East and West.

Railway Pro: Was the recession high on the agenda or did other issues take precedence?

Jean-Pierre Loubinoux: Findings showed that despite the differences between countries, overall we have seen signs of recovery from the recession in the global freight market over the past six months, in terms of demand from customers and capacity from operators. This is good news considering how operators have lost volume and market share due to the crisis. Consequently one of the topics explored in St Petersburg was the necessity to anticipate growing needs as this recovery grows – firstly to be in the right place at the right time; secondly to prepare for a possible second crisis and have the tools and strategies in place to better cope. But despite lingering uncertainty over which way this crisis will swing, the railway market is in a good position because of its environmental strengths, capacity and mobility potential.
Another point raised was the importance of putting customer needs and expectations at the heart of operations. Here the answer is logistics, e.g. mass production, longer hauls and fewer but bigger hubs. Logistics should be combined with terminals for collection and distribution, longer haul transport chains and greater integration between modes, and not just on a European level but worldwide. We held the last Global Freight Conference in New Delhi in 2007, and at that time there was talk about longer hauls but little concrete action. Today we are making them happen with long international corridors in both Europe and Asia. This day and age sees international trade flows creating new perspectives and needs for efficient, safe and economically viable transport, boosting sustainable performances – particularly on long-distance routes. This evolution reflects current growth patterns in world trade and constitutes the basis for a successful globally-oriented rail freight network. Cross-border corridors and modal logistics complementarity along many development issues are the tools for regional and international development. The UIC, together with its railway members, is fully committed to meeting these new challenges and working together to transform these perspectives into reality.

Railway Pro: Is interoperability crucial for growing the freight market?

Jean-Pierre Loubinoux: When looking at interoperability we need to take into account both the technical and administrative aspects involved. And the administrative, i.e. tax issues, loading and consignment bills, is clearly a barrier to developing the rail freight business today. What is commonplace practice for maritime has yet to be established in rail operations. This is possibly due to political legacy – the Berlin Wall only came down at the end of the 80s and it isn’t so long since Russia opened up to international trade.  Shipping hasn’t been hindered by such issues. Hence one of the topics raised in St Petersburg was harmonising transport laws and this work was reinforced by the presence of other important institutions such the International Rail Transport Committee (CIT), European Intermodal Association (EIA), Community of European Railway and Infrastructure Companies (CER) and the Association of
American Railroads (AAR), amongst others, which took this opportunity to push their messages. The overall goal is to simplify, unify and harmonise rules. One of the difficulties of opening up freight to a wider, more international market and making it more fluid is its system of rules and regulations, which differ from country to country or are interpreted differently.  However it may well be that the economic crisis has forced the sector into adopting fresh approaches in order to pick up and grow in better conditions. For example the importance of growing opti-modality for longer routes with trains, for example corridors between ports.

Railway Pro: How can rail freight turn concerns about the environment to its advantage?

Jean-Pierre Loubinoux: From an environmental perspective – fuel consumption, emissions and congestion – rail offers a potentially better solution for transporting goods than roads.  But at the same time we are seeing group strategies that involve combining both modes, e.g. First One in Russia, DB Schenker Rail in Germany and Kéolis in France. Also the UIC launched its Eco-comparison tools in 2008 to calculate the environmental impact of freight trips on European routes. Available on Web, this ‘user-friendly approach’ can calculate and show in detail to every customer the energy consumption, CO2 emissions and local pollutants for each selected route, with a sound methodology.

Railway Pro: What about rolling stock? Sales of locomotives have been stagnating…

Jean-Pierre Loubinoux: Although infrastructure is being built and extended across Europe, at the same time this must be accompanied by growth in capacity via the volume of TUs. Recovery means capacity must be stepped up.

Railway Pro: How does Romania stand in Europe’s freight market?

Jean-Pierre Loubinoux: One strong point is that the country showed immense reactivity by liberalising its freight and passenger sectors before joining the European Community, to adjust its capacity to the European context. As a consequence it has grown its operations with many different players, who have invested in trains. So it has excellent rolling stock. But on the downside the rail infrastructure is in a poor state. Here it seems the country hasn’t invested using European funds that have been available; perhaps the roads have been given greater priority. However on numerous occasions I have hammered home the point that there’s little to be gained by investing in good trains without the infrastructure to carry them. And other Eastern European countries like Slovakia, Serbia and Slovenia are in the same situation. It’s vital local governments invest in improving their rail infrastructure – not only will local freight operators benefit, but also international. And since Romania is strategically located on the TEN-T rail corridor it is a transit country and must ensure it has sufficient capacity for transiting freight. Achieving this means raising awareness of the stakes at play. Also since infrastructure doesn’t grow overnight but takes years it’s vital to think ahead and, like I said earlier, anticipate the future state of the market.

by Lesley Brown

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