DHL Global Forwarding, a leading provider of air, sea and road freight services in Europe and Asia, signed a Memorandum of Understanding (MOU) with Kazakhstan Temir Zholy Express (KTZE), a holding company based in Kazakhstan which functions as the national multimodal operator.
The pioneering MOU will enhance greater rail connectivity and trade between China, Kazakhstan, the Commonwealth of Independent States (CIS) and Europe, providing DHL Global Forwarding with additional commercial block train services. This will allow DHL Global Forwarding to enhance the scheduled rail services for customers, increasing the overland rail routes as a complimentary alternative to traditional sea and airfreight.
Under the MOU, KTZ will be responsible for operating rail activities from point to point as well as across the China/Kazakhstan borders. DHL will also focus on developing its forwarding capabilities along crucial trading routes linking China, Kazakhstan and CIS countries while KTZE will add several logistics service locations to its existing network as well as increasing their overall capabilities. The partnership will see the development of additional rail offering along the South Silk Road trade route to Europe via Kazakhstan.
Steve Huang, CEO, DHL Global Forwarding China said: “We have witnessed tremendous growth in rail freight between Asia and Europe over the last few years; and we see a lot of growth potential in many intermediate trade hubs such as Kazakhstan. Kazakhstan’s own economic development stands to benefit significantly from strong infrastructural links to China and the EU – its two largest trading partners. Transportation alone makes up more than 10 percent of the country’s services exports.”
With the setting up of the Khorgos Special Economic Zone, this partnership will offer new logistics solutions within the zone, which will contribute to the importance of the trans-Kazakh route as one of the major trade nodes connecting China, Kazakhstan and the CIS region for onward distribution to Europe.
According to the European Commission, the volume of China-EU trade amounts to more than 1 billion euros every day, making the trade route the second-largest cooperative economic relationship in the world. The KTZ group expects annual trade between China and Europe to grow by 1.5 times to reach $1.2 trillion, with Astana aiming to have 8% of that transported through Kazakhstan as well.
“By partnering with KTZ Express, we hope to provide China-Europe trade expanded services in the pivotal Central Asia region, through investment in both new and traditional trade route infrastructure, like rail enhancements along the South Silk Road – in line with China’s ‘One Belt, One Road’ initiative,” added Steve Huang.
Sanzhar Yelyubayev, President, KTZ Express, said: “KTZ Express is looking to establish the most advanced central Asia logistics hub in Kazakhstan by enhancing various facilities across the country and improving our freight forwarding capabilities. The partnership with DHL will not only accelerate our pace towards achieving this goal but will also help us serve multinational corporations with regional needs in these high-potential markets. KTZ Express will work hand in hand with DHL to further develop end-to-end logistics solutions via rail and multimodal solutions in this part of the world. We will continue to work on reviving the Silk Road and increasing our capacity to move goods within the region as its economic growth and development gain critical momentum.”
DHL Global Forwarding has extensive networks in rail services running rail connections between China and Europe from Zhengzhou to Hamburg and from Chengdu to Lodz along the trans-Kazakh West Corridor as well as from Suzhou to Warsaw via the trans-Siberian North Corridor.
As part of the MOU, DHL Global Forwarding will provide logistics expertise, which includes value-added offerings such as temperature-controlled containers to support businesses in industries like technology and electronics. DHL Global Forwarding introduced the first temperature controlled China-Europe rail service last year. DHL containers, powered by diesel-electric engines, have temperature control capabilities, which can be tracked and remotely modified. This allows for an all-year round multimodal shipping solution for temperature sensitive products.