Economics

00:09, 21.12.2007 | APR

Public Corporation Russian Railways plans to build a $100 million container terminal in North Korea as the world's largest rail company tries to create a land transport corridor linking Asia to Europe.

State-run Russian Railways wants to turn the North Korean port of Rajin into a hub capable of handling 320,000 containers a year for shipment across Russia to Europe, the company said in a statement distributed to reporters today.
The investment is part of a plan that originated in 2001, when North Korean leader Kim Jong Il traveled by rail from Pyongyang to Moscow to visit President Vladimir Putin. As the first step in linking the Korean peninsula to the Trans-Siberian Railway, Russian Railways is upgrading 54 kilometers (34 miles) of track from the border south of Vladivostok to Rajin.
Russian Railways will spend 1.75 billion rubles ($70 million) on improving the track, the company said. Another $100 million will be needed to turn Rajin port into a terminal capable of loading containers shipped from South Korea on to freight trains bound for Europe. The proposed terminal will be operated by a Russian-North Korean joint venture.
Delays over financing and feasibility have plagued the plan for an ``Iron Silk Road.'' Russian Railways Chief Executive Officer Vladimir Yakunin previously said the rail link to Rajin would be completed by the end of 2006.
The two Koreas opened regular freight train service across the demilitarized zone on Dec. 11.

- Bloomberg