Publication: Eurasia Daily Monitor Volume: 3 Issue: 166

The countries of Northeastern Asia have long mooted new infrastructure projects to improve transportation links in the region. However, some routes tend to materialize more slowly than others.

Russia, China, Japan, and South Korea have now agreed to launch a new cargo and passenger sea route linking China and Japan. The route, which is expected to open in early 2007, is to connect Hunchun in China’s northeastern Jilin province, and Niigata in Japan, running through the Russian port of Zarubino and South Korea’s Sokcho. According to the agreement, China and Japan will be in charge of cargo, South Korea’s shipping company will be the carrier, and a Russian firm will deal with customs procedures in that country.

The route will be the only direct cargo and passenger transport line among the four countries around the Sea of Japan, Ren Puyu, vice mayor of Hunchun, announced on September 5. The new route is expected to reduce freight costs. “How much each party will invest in the joint venture has not been decided yet,” said Ren, adding that other Japanese ports, such as Tsuruga, Sakaiminato, and Akita, have also applied to become destinations along the route (Xinhua, Itar-Tass, September 5).

Initially, some 12,000 20-foot containers are expected to be funneled via the new route every year. A trip along the new route would take only one and one-half days, just one-eighth of the current run, which starts at the port city of Dalian in Liaoning province, more than 1,000 kilometers from Hunchun. Cargo is now sent to Dalian by train or truck before it is shipped to Japan.

Northeast Asia is emerging as a global trading hub. The six countries in the region, China, Russia, Japan, South Korea, North Korea, and Mongolia, account for 21% of world exports and 16% of imports, according to the United Nations Conference on Trade and Development (UNCTAD). Regional trade nearly doubled to some $320 billion from 2000 to 2004, and over the past five years has accounted for almost 40% of all Asian trade.

In the meantime, Russia, China, and North Korea have long eyed the Tumangan trade project, which envisions the development of the Tuman River basin, where the borders of Russia’s Primor region, China, and North Korea meet, into a major transit and trading area. The project was designed to give landlocked areas in northeast China, which border Primor region, better access to seaports.

Only 44,000 people live in the Khasan district, the southwestern part of Primor region. The Khasan district has seaports, Posyet and Zarubino, as well as border crossings into China and North Korea. The Khasan region is also known for its pristine environment, including a unique nature preserve, Kedrovaya Pad (Cedar Valley). A major transportation project could adversely affect the region’s environment, including the Gulf of Peter the Great, a habitat for more than 2,000 rare marine species.

Local officials in the Russian Primor region opposed the Tumangan project as its realization threatened seaports in the region. The Primor regional authorities have suggested a new route for shipping cargo between the United States and China through Russia’s Far Eastern ports instead of via South Korea and Japan. However, the proposed route, which would take cargo through Russia’s Far Eastern ports instead of via South Korea and Japan, is yet to materialize.

The Tumangan project was expected to give trade ties between Russia and North Korea a much-needed boost. However, the project still remains on the drawing board. The Soviet Union was a close ally of Pyongyang during the 1950-53 war, but relations experienced a downturn following the Soviet collapse in 1991. Russia, Pyongyang’s neighbor thanks to a narrow land border near Vladivostok, has sharply downgraded its ties with North Korea.

Russia has promised to help rebuild North Korean construction projects begun during the Soviet era, although Moscow’s would-be aid has been understood to be conditional on regular payments on Pyongyang’s Soviet-era debt, estimated at around $4 billion. On the other hand, Moscow reportedly offered to repay its $1.7 billion debt to South Korea by joint investments in North Korean projects, including construction of Korea’s North-South railway, which is to be connected with Russia’s Trans-Siberian railway.

In recent years, the joint Russia-North Korea Railway Commission has held regular meetings, but few concrete results have been achieved so far. Both sides have discussed the $250 million project to rebuild the Trans-Korean railroad and link it to the Trans-Siberian line. Completing the link was expected to significantly increase cargo transit via the Trans-Siberian railroad and reduce the time needed to ship goods from South Korea to Europe. However, Russian officials have conceded that the project involved a significant political risk and would require substantial investments.

As a legacy of the Soviet-era close ties, Russia and North Korea share a rail link, which allows transportation between the two countries. A rail connection between Khasan (Russia) and Tumangan (North Korea) still operates, but at very low level. In 2005 little more than 10,000 people traveled along this line.

On September 5, Russian and North Korean railway officials had talks in Vladivostok to discuss a project to restore a 40-kilometer railway link between Khasan and the North Korean port of Rajin. It was originally expected to be completed by the end of this year, but actual work is yet to start (RIA-Novosti, September 5). In other words, Moscow is becoming less keen to develop joint transportation projects with Pyongyang.

Therefore, a new Jilin-Niigata sea route linking China and Japan through the Russian port of Zarubino appears to come as an indication that Russia has become disillusioned with the North Korea-oriented Tumangan project and would back other projects instead.