Gridlock: All Trains Lead to Moscow
Summary
The Russian Railways Ministry banned Russian freight trains from
carrying cargo to or from former Soviet republics that owe the
ministry money. Since most of these states depend upon Russian
transportation for their exports, the Railways Ministry decision
could deliver a crushing blow to their fragile economies. It also
highlights just how dependent on Russia these countries remain -
and who is ultimately in charge.
Analysis
The Russian Railways Ministry temporarily banned Russian freight
trains from carrying cargo to or from former Soviet republics that
owe the ministry money, according to the Moscow Times on Aug. 19.
Since most of these states depend upon Russian transportation for
their exports, the Railways Ministry decision could deliver a
crushing blow to their fragile economies. It also highlights just
how dependent on Russia these countries remain.
The ban covers Azerbaijan, Georgia, Moldova, Tajikistan,
Turkmenistan and Uzbekistan - all states that count Russia as their
largest trading partner. While the states could dispatch their own
trains to shuttle goods across the breadth of Russia, they would
then be unavailable to service local needs. For the Central Asian
states the ban is a double blow. Any exports destined for Europe or
the United States must first transit Russian territory. Until the
debts are paid, that transit is impossible.
Shifting their trade to other states is not an option. There simply
isn't infrastructure to support other trade relationships. Of the
states targeted, only Georgia has a seaport. Azerbaijan, Kazakstan
and Turkmenistan each has only a single rail line that leads away
from the former Soviet Union. Uzbekistan is doubly landlocked.
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While replacing rail transport with truck shipping is an option, it
is not an attractive one from a cost point of view. Almost all of
the exports of the states on the blacklist are bulk commodities:
cotton, coal, grain and various ores. Fuel costs alone make trucks
unfeasible. For example, once a shipment of cotton from Tashkent
bound for Europe crosses 1,000 kilometers of Kazak territory, it
still must traverse 2,000 kilometers of Russian territory and 1,000
kilometers of Ukrainian territory before even reaching Central
Europe. That's quite a gasoline bill.
This is not to say that the railways of the former Soviet Union are
in good shape. Russian Railways Minister Nikolai Aksyonenko
estimates that $22 billion in repairs are needed to restore full
productivity. Yet they are still the most efficient transportation
option - or at least they were until the Railways Ministry
decision. As it stands, only petroleum exports shipped via
pipelines will be unaffected. With a single ban, the Railways
Ministry effectively gutted the export economies of six states.
They will have no choice but to pay their debts in full, and in
hard currency.
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Options for retaliation are few and ineffective. Georgia could push
for closer NATO ties and Uzbekistan could again withdraw from
Russian led security pacts. But in the end, Russia holds too many
hammers over the states on the blacklist to brook any serious
resistance.
There is a political component to the ban as well. Aside from
Tajikistan, all of the blacklisted states have rocky relations with
Russia. Yet since they have no economic alternatives to Russian
predominance, cutting off rail access is a simple - and
excruciatingly painful - way for Moscow to drive home just who
really is in control.
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