Kazakhstan : CAREC Corridors 1 and 6 Connector Road (Aktobe–Makat) Reconstruction Project

Transport / Road transport (non-urban)

Roads enable connectivity and mobility, which are essential conditions for economic growth and development. This is particularly relevant for Kazakhstan---the world's largest landlocked country with a resource-rich economy and, at about six persons per square kilometer, a population density among the lowest in the world. Kazakhstan's main natural resources---hydrocarbons, oil, gas, ferrous, and nonferrous metals---are unevenly spread over the country and remain largely untapped because of infrastructure constraints. Landlocked countries suffer most from high transport costs, which can be much higher than the tariffs on imported and exported goods. A World Bank study estimated that transport costs account for 8%-11% of the final cost of goods---almost double the cost for most industrialized countries. As such, the development of transport infrastructure, together with sector efficiency improvements, can play a catalytic role in the sustainable social and economic development of the country. Continued public sector investments are needed to modernize the infrastructure base, which strongly correlates with economic diversification and more robust growth.

The Government of Kazakhstan has been upgrading its national transport system since 2007, to better integrate Kazakhstan into the world economy. This includes the reconstruction of the 2,787 km Western Europe-Western People's Republic of China (PRC) international transit corridor (also known as the Central Asia Regional Economic Cooperation [CAREC] corridors 1b and 6b,c) to improve its efficiency and effectiveness. The country is already capturing a significant volume of transit traffic through roads and railways. Strategically, Kazakhstan has much potential to link the East Asia countries with Europe by road and rail, and through inland shipping along the Caspian Sea.

With oil prices tumbling since 2014 and lower external demand slowing the economy, Kazakhstan responded with a new economic anti-crisis program. The President, in his address to the nation on 11 November 2014, announced Kazakhstan's Infrastructure Development State Program (IDSP)---Nurly Zhol---for 2015-2019. To enable a favorable environment for business-driven regional economic integration, among others, the IDSP prioritizes domestic transport links of strategic importance and regional impact, and connects the national capital, Astana, with other 'urban agglomerations and/or 'second-tier cities in the eastern, western, and southern parts of the country. Accordingly, the government, aided by development partners, is accelerating the development of the Center South (Astana-Almaty), Center East (Astana-Ust'-Kamenogorsk), and Center West (Astana-Aktau) corridors. The program will be implemented from 2016 to 2020. The overall IDSP is expected to generate a significant number of new jobs and incomes through public investments.

The existing Aktobe-Makat road is a two-lane national road originally designed to categories III and IV standard, and connects the CAREC corridors 1b and 6a, as well as the capitals and administrative centers of the oil- and mineral-rich provinces of Aktobe and Atyrau, where approximately 1.7 million people live. Most of the existing road pavement is either non-existent or damaged to the extent that ordinary passenger cars cannot move faster than 30 km/hour. As a result, many vehicles divert off the road and travel on parallel dirt paths. This largely deters both passenger and freight operation from using the road. Many passengers traveling between Aktobe and Atyrau have to use infrequent railway services instead, and much goods traffic is diverted to the northern Aktobe-Oral-Atyrau route, but the detour takes more time needed with an additional distance of 360 km. Poor road connectivity has also become a key social issue contributing to the growing income disparity between rural and urban areas.

Modernized transport system with increased freight transit, improved network connectivity and creation of infrastructure centers.

Improved network operational performance, increased transit potential and improved social and economic development of the western region of Kazakhstan in particular

299 km of two-lane highway connecting Aktobe and Makat reconstructed to category II standard and operational

Improved transport system operation with better provision of road traffic safety and logistics effectiveness

Seven civil works contracts have been awarded.

Contract for the supply and delivery of equipment was awarded to THG Technik Handel Gessellschaft AG on 31 July 2019.

Indicators will be measured upon completion