Inter-Korean railway could enhance logistics

Industry

Published: 19 Jul. 2018, 20:25

Inter-Korean railway could enhance logistics

A northern transport network connecting the Korean peninsula with China, Russia and Europe will enhance the competitiveness of Korea’s logistics industry, according to the Korea International Trade Association, a local business lobbying group, on Thursday.

The northern transport network, or corridor, refers to a hypothetical grand transport route that would connect the Trans-Korean Railway with railways across China, Mongolia and Siberia as well as northern sea routes. The network would enable goods from Korea to be delivered directly to Europe by both land and sea.

While the Trans-Korean Railway has always seemed impossible due to the separation between the two Koreas, the recent improvement in relations has put a spotlight on the possibility that a railway spanning the Peninsula could actually be realized.

“Once the northern transport network becomes a reality, Korea will be connected to the economies in Eurasia,” said Kim Young-joo, head of KITA, during an event to discuss ways to boost the north-headed network on Thursday. “This will help Korea secure various export routes and even promote reconciliation between the two Koreas.”

Kim further added that an active logistics business on the network would invigorate the Korean economy by creating new jobs and new business opportunities.

Logistics companies in Korea that use the Trans-China and Trans-Siberian Railway to deliver goods to Eurasia and Europe are anticipating that the new transport network could significantly lower costs and strengthen business competitiveness.

A spokesperson from CJ Logistics said freight rates, transport time and the cost for cargo transshipment will be greatly reduced if the Trans-Korean Railway is linked to the Trans-China Railway and Trans-Siberian Railway.

Koo Hyung-joon, an executive vice president at Hyundai’s logistics arm Hyundai Glovis said it is crucial for Korea to cooperate with China and Russia to establish a standardized operating system for railways that they hope to connect. Koo also said that the Korean government needs to run projects that could attract investment from private logistics companies to prepare to establish the transport network.

Rep. Song Young-gil of the Democratic Party of Korea, who serves as head of the presidential northern economic cooperation committee, said the establishment of the Trans-Korean Railway would make Korea a global logistics hub.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]