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RAIL CONTAINER SERVICES BETWEEN EU AND CHINA: INTEGRATION AS THEKEY SUCCESS FACTOR

ALEXEY GROM, UTLC ERA PRESIDENT & CHAIRMAN OF THE BOARD

EURASIAN LOGISTICS INTERNATIONAL SEMINAR“NEW ERA OF THE EURASIAN TRANSIT”

CHENGDU, 29 NOVEMBER 2018

WE CELEBRATE TOGETHER 3000th CONTAINER TRAIN BETWEEN CHINA - EU

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The 3000th train was sent on the services of JSC UTLC ERA in November 2018.

Route of 3000th train: Nuremberg – Chengdu.

Such a result is possible only because of the common efforts of all participants on theinternational transport market in the framework of the national strategies and programsof China, Kazakhstan, Russia, Belarus and the European Union of Eurasian railwaytransportation.

78 101176

280346

415498

598

717

861

1033

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

+74%+59%

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+20%+26%

+20%

+20%

+20%

+20%

+20%

ONE BELT, ONE ROAD, ONE MILLION

+112%

thousand TEU

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ROUTES IN UTLC ERA SERVICES IN 2018

Chengdu – Kutno / Lodz / Nurenberg / Tilburg / Kolyadichi / Malaszewicze / Budapest / WarsawChengdu - MilanChongqing – Hamburg / Duisburg / Warsaw / MalaszewiczeWuhan – Hamburg / Duisburg / Gorzow / Malaszewicze / PardubiceIwu – London / Madrid / Prague /MalaszewiczeXining – AntwerpXian – Kouvola / Budapest / Malaszewicze / HamburgTaiyuan / Urumqi / Wuhi – Duisburg / MalaszewiczeHefei – HamburgZhengzhou – Hamburg, MunichShenzhen – MalaszewiczeXiamen – Malaszewicze / Hamburg / BudapestTaishan – Antwerp

China - Europe

Hamburg – Wuhan / Kuitun / Xian / Hefei / Zhengzhou / ChongqingDuisburg – Chongqing / Iwu / Kuitun (Korla) / Wuxi / Kashi / Lanzhou / Xian / UrumqiHamburg / Duisburg / Kolyadichi – ChengduLodz / Nuremberg / Tilburg / Malaszewicze / Kutno –ChengduMilan - ChengduMelzo - ChengduKouvola - XianGent -ChengduMadrid / Prague – IwuMalaszewicze – Chongqing / Kuitun / ChengduMunich – ZhengzhouWarsaw / Poznan – ChongqingMangheim – ChongqingLiege – Zhengzhou

Europe - China

ALLOWS TO HANDLE 1 MILLION + TEUS

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CAPACITY OF RAIL INFRASTRUCTURE ON UTLC ERA ROUTES

Kaliningrad

BruzhiSvislach

BrestDostyk

Altynkol

KrasnoeKartaly

Kanisai

Dostyk/Altynkol – Kanisai –Krasnoe – Brest/Bruzhi/SvislachUp to 10 pairs of trains/day

Dostyk/Altynkol – Kartaly –Krasnoe – Brest/Bruzhi/SvislachUp to 10 pairs of trains/day

Max capacity of 1520 mm gauge – up to600 000 TEUs through Kanisai600 000 TEUs through Kartaly

Maximum capacity 1.2 million TEU

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CAPACITY OF BORDER TERMINALS ON UTLC ERA ROUTES

EUROPEAN UNION

CHINA

450 000 TEUS/YEAR

Kaliningrad

BruzhiSvislach

Brest60 000 TEUS/YEAR60 000 TEUS/YEAR

450 000 TEUS/YEAR

Dostyk

Altynkol

450 000 TEUS/YEAR

900 000 TEUS/YEAR

KrasnoeKartaly

Kanisai

ALLOWS TO HANDLE 1 MILLION + TEUS

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Bremerhaven

Trelleborg

Goteborg

Stockholm

Hamburg KaliningradGdansk

Rostock Braniewo

Lodz

Berlin

Duisburg

340 km

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Kaliningrad «Dry» Kaliningrad «MM»

Max frequency of trains per day 16 8

Max capacity, TEU per year 450 000 300 000

Transit time from Kaliningrad sea port:

Trelleborg HamburgRostock

36hours

20hours

16hours

WHY KALININGRAD?

Rotterdam

Rail distance from station Braniewo to:

Lodz Berlin Duisburg

320km

530km

1000km

November 2, 2018 from the port of Kaliningrad through theDostyk station to Chengdu JSC UTLC ERA sent two trains,which arrived by sea from Rotterdam, in the frame ofmultimodal transportation project.

PRICING POLICY OF UTLC ERA

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1. Openness, transparence, competitiveness.2. December, 1 – announcement of prices for the 1q 2019

Goals:1. Creating the best pricing terms in the rail corridor

Kazakhstan – Russia – Belarus.2. Pricing policy is based on the principle: the lowest rate

to the largest volumes of containers.

3.800 3.500 3.000 2.800 2.600

800 900 1.0001.900 1.950

2016 2017 2018 2019

* This level of the rate for new cargo flows China-EU > 30 thousand teu/month

UTLC ERA RATETerminal-Terminal

WORLD CONTAINER INDEX(Drewry)Port-Port

ERAI – RAILWAY TRANSIT PRICE INDEX 1520

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Reflects the average cost oftransporting 40’ container alongEurasian rail transit corridor China –Europe by infrastructure at 1520 mm ofKazakhstan, Russia and Belarus

Accessibility, transparency, competitiveness123

Opportunity to plan logistic expenses

Obtaining a prompt information about the current rate of ERAI

Functionality:

www.index1520.com

- index of:

cooperation

partnership

connectivity

TO RAIL OR NOT TO RAIL?

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UTLC ERA ROAD MAP

11

2014 201920182016

UTLC foundation

New business model

UTLC ERA foundation

The year of sustainable connectivity

2025

One millionstation

We declare 2019 the year ofsustainable connectivity

TO RAIL!

OPERATIONAL PLAN FOR ONE MILLION CLUB

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Common operational targets

Technological interoperational adjustments at the borders

Synchronized infrastructure development

Mutual speed increasing

Digitalization

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