International logistics company DP World and Russian Rosatom signed an agreement on July 23, under which they will work together to develop container shipping across the Arctic.
The Northern Maritime Transport Corridor (NMTC) is being created in stages along the Northern Sea Route (NSR) that runs along the north coast of Russia from Murmansk in Northwest Russia to Kamchatka in the Far East. Developing the route – also called the Northern Transit Corridor by DP World – is part of Russia’s efforts to exploit the Arctic as global warming opens it up to sea traffic. Rosatom is the national infrastructure operator of the NSR.
The two companies said they aim to develop the corridor as a “viable and sustainable route between Asia and Europe”.
Under the agreement, signed by DP World group chairman and CEO Sultan Ahmed Bin Sulayem and Rosatom’s director-general Aleksey Likhachev, the companies will set up a joint venture to invest in, build and operate transport and logistics capacity along the route.
“The northern route cuts up to 19 days [off] the journey time between Southeast Asia and Northwest Europe. One third of the world's trade flows between the two continents and saving shipping time will significantly reduce CO2 emissions,” said DP World’s press release.
It adds that the width and draft of vessels are not an issue along the corridor, and the route is not only shorter than alternatives and but is also not congested.
In 2020, a record 33mn tonnes was carried along the corridor, and Russian President Vladimir Putin has set the target of raising the total to 80mn tonnes by 2024.
To increase the use of the route there are plans to develop ports and other transport links along Russia's north coast.
Bin Sulayem said DP World supports Russia's efforts to diversify trade flows between Asia and Europe. “The Northern Transit Corridor holds out the prospect of shorter transit times between East and West,” he said in a statement.
"DP World has already committed to invest $2bn with the Russian Direct Investment fund, and we will continue to work with our partners in Russia to find solutions that allow the Northern Transit Corridor to develop sustainably.”
"Building sustainable transport infrastructure in the Arctic opens up new opportunities in developing the Eurasian transit which can be achieved in an optimal timeframe and help reduce the environmental footprint through shorter route distances and the advanced low-carbon energy solutions applied,” said Likhachev.