36th APEC Transportation Working Group
St. Petersburg, Russia
Northern Distribution Network (NDN) created a new supply chain into Afghanistan through and within Russia, Central Asia and the Caucasus
• Distribution network was totally commercial
• US Government negotiated transit agreements but commercial companies ironed out the
working arrangements and determined routes
Northern Distribution Network created the opportunity for greater cooperation between the countries in Central Asia as related to trade & transit processes (customs, tariffs, border procedures)
• NDN has led into the Silk Road which supports trade and transit development in the Silk Road region (Central Asia, Pakistan, India)
• Trade & transit development in Central Asia will open markets for APEC countries
NDN key concerns and lessons learned
• Need to diversify our supply chain and not rely on only one route
• Major concern was choke points along the supply chain and lack of logistic hubs
• Diversification of routes & modes of transportation minimized disruptions
• Hairaton, Afghanistan was primary concern and we asked ADB to make the Hairaton to
Mazar rail line construction a priority
Hairaton rail line lessons learned
• Created cooperation between governments of Afghanistan and Uzbekistan
• Not easy and ADB spent much effort
• Construction phase much easier than implementation phase
• Total supply chain needed to be considered
• Wrong location for rail terminal
• Private sector needed to be involved
• Lack of consideration of logistics hub in Mazar
• Rail line has now inherited a $20 million three year Operations & Maintenance cost
• Public Private Partnership could have avoided this- need private business for
sustainable development
The Road Ahead
• Without the private investment and involvement there will be no sustainable infrastructure development for the region
• Private sector is the key to creating sustainable infrastructure and logistics support in transitional countries
• More transportation infrastructure is critically needed in this region
The Road Ahead
• The Silk Road region will be one of the key emerging markets due to tremendous mineral wealth in Afghanistan & the region
• We need to continue our support and cooperation with NGOs such as IRU and ADB
• Greater transportation infrastructure & modal connectivity will create opportunities for APEC countries in the Silk Road Region
Comments