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Along the New Silk Road – Anaklia: A stepping stone to Europe

  • Written by  Charles Stevens
  • Published in Development
The Spirit of Anaklia The Spirit of Anaklia (Image: Rob Krawczyk/The Silk Road Project)
21 Sep
2018
As part of our monthly series of reports looking at the impact China’s BRI project is having on the local infrastructure situated along its route, explorer and China scholar Charles Stevens visits a major development project that could open up the Caucasus

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THE NEW SILK ROAD PROJECT
Covering 10,000 miles and 18 countries The New Silk Road Project is an exploration of China’s emerging Belt and Road Initiative. Having departed from London in June 2018, it will travel along the full length of the world’s next great trade route – a nexus of power, culture and commerce that now sits at the heart of China’s foreign policy.

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‘Anaklia will restore the ancient Silk Road,’ a bold claim and certainly the belief of the Anaklia Development Consortium regarding its flagship project. This consortium functions as an umbrella group of half a dozen local and international firms devoted to constructing the new deep sea port and special economic zone of Anaklia in western Georgia, a country nestled within the Caucasus. The hope is that this emerging trade route will benefit both Anaklia and, more widely, Georgia as a whole by reigniting the flow of commerce from China to Europe along this route.

Anaklia is centrally positioned within the Middle Corridor; an aspiring economic passage that stretches from China across Central Asia, as well as connecting the Caucasus and the Middle East to Europe. As the most direct overland transportation route across Eurasia, this corridor’s development is important to China’s Belt and Road Initiative by giving it access to new markets in Central Asia and fulfilling its benign perceived image in the popular imagination as a recreation of the ancient Silk Roads.

Anaklia sign over a previous onePromised investment into the area is yet to take root (Image: Charles Stevens/The New Silk Road Project)

It also functions as an alternative to the more established and less bureaucratically cumbersome North Corridor into Europe from China through Kazakhstan, Russia, Belarus and Poland. Levan Akhvlediani, CEO of the Anaklia Development Consortium, admits that while this future port city may never be a primary node in this expanding multimodal network, it ‘can be […] one of the most reliable alternatives along the Belt and Road.’

Anaklia Development Consortium’s study of archival evidence dates the first failed attempts to establish such a trade hub to 1974. Remains of such efforts, particularly those of the former prime minister, Mikheil Saakashvili, are ingrained into the town’s fabric; decommissioned concrete tetrapods (coastal defences designed to prevent erosion from the sea) lie idly along the southern extremities of the settlement’s coastline; the stilted Justice House faces the dismembered Abkhazia region further up the shore of the Black Sea; a public sculpture, The Spirit of Anaklia, on the pier points to the failed attempts to establish the smart city of Lazika.

Anaklia Port Landscape (Image: Rob Krawczyk/The New Silk Road Project)Anaklia Port Landscape (Image: Rob Krawczyk/The New Silk Road Project)

This last was an attempt to construct the second largest city in Georgia, one based on English common law in order to attract international companies. However, a change in Georgia’s government in 2012 saw the project abandoned. As one local academic told us when asked about Anaklia Development Consortium’s most recent ambitions, ‘the accent is on the port, the accent is on transit corridors, the accent is on the New Silk Road. Lazika was couched in a much wider array of national and geopolitical imaginations. It was presented as the city of the future.’

Paul, one of the Georgian project managers, guides us around the grassy 70 hectare site just south of the town centre. Here, the $60million development of ‘Phase 1’ of the port is just commencing. This will construct its fundamental structures including the container terminal, dry bulk facility and northern breakwater which will protect the moored vessels from rough seas during unfavourable weather.

Site panoramaCharles, Tom, Rob and William being shown around the Anaklia development site (Image: Charles Stevens/The New Silk Road Project)

These facilities will then be added to and expanded upon in the eight succeeding phases of development. However, cows grazing metres away from the materials for the new pump house and worker camps struck an odd chord; especially considering the start of dredging in August, reclaiming the five million cubic meters of sand required to raise the marshy port area by over two metres and securing its use for the arrival of the first vessels in 2020.

According to Rusudan Phanozishvili, editor-in-chief of the Anaklia Development Consortium Magazine, ‘Georgia has no experience in maritime infrastructure, the last port we built was over 100 years ago.’ As a result, this work marks a new chapter in Georgian history; one where the localism of the Megrelian people (an ethnic subgroup of Georgians) collides with the globalisation resulting from the deployment of large-scale development strategies.

Doosan diggerAsian-supplied machinery is already on site for the first phase of construction (Image: Charles Stevens/The New Silk Road Project)

It is of little surprise that this venture has already benefited from Chinese investment. The country is contributing to the financing of this $2.5 billion enterprise through the Asian Infrastructure Investment Bank, a multilateral financial institution established partly in response to the needs of the Belt and Road Initiative. In the Consortium’s polished headquarters in the Georgian capital, Tbilisi, five hours east of Anaklia, we were informed of the likelihood of future partnership with Chinese companies for the supplying of port equipment. Such collaboration is indicative of the deepening economic cooperation between Georgia and China in recent years, in which the Hualing Group has risen to become one of the largest foreign investors in the country and is seen as being vital to the continuing development of its economy.

The development’s social and environmental obligations are being handled with the diligence required to transform Georgia’s poorer Samegrelo region into an engine for economic growth. Paul showed us where citrus and orange trees had once stood – now safely relocated to Zugdidi Botanical Garden some 30km east of Anaklia. The topsoil from the first phase of the port had also been moved to a protected area. Coupled with the decision to semi-automate the port, allowing the skills of the local Georgian workforce to be more fully utilised in areas such as transferring freight from ship to lorry or train, it points to a company with an eye firmly on its corporate social responsibility programme.

MERICS Silk Road v8An overview of the full BRI plan (Image: MERICS - Click to enlarge)

Wang Shengxin, general director of the Hualing Group Georgia, one of the country’s largest foreign investors, is encouraging Chinese investment in projects such as Anaklia. In part this is to utilise the local workforce (which, in turn, helps maintain positive relations between the countries), but there are other more important reasons for the overseas investors. Georgia's macroeconomic stability, strategic position on the Middle Corridor and highly desirable free trade agreements with both the European Union and China allow Chinese companies to use the country as a platform to access the lucrative European markets which it otherwise would be unable to enter due to incredibly high trade tariffs. Given this, Anaklia can act as a stepping stone between the two.

As we exited the site, our route took us eastward, past single-storey houses and power lines. Herds of pigs and roaming cows lined the single-lane, pot-holed road which functions as the major artery to the town. While this bucolic setting is quaintly pleasing, it does raise the concern that surrounding infrastructure will have to coalesce more quickly in order to meet the demands of the flagship project. This is critical if Georgia is to succeed in becoming a transport corridor and economic hub. As the recently elected prime minister, Mamuka Bakhtadze, drove the opposite way toward Anaklia that same day he surely would have recognised the need to act decisively in deploying the $100 million the government had promised in improving the surrounding road and rail network.

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