The coronavirus pandemic affected the supply chain and caused a staggering increase in the container prices of maritime transportation. But the new Turkiye-UAE trade corridor is likely to be both time and cost effective. The first shipment from the United Arab Emirates (UAE) to Turkiye, through Iran, has succeeded with an Emirati truck arriving in the Mediterranean port of Iskenderun in less than a week. The new trade route between Turkiye and the UAE shortens the distance and time of shipments from both countries and vice versa to seven days instead of 21. At the same time, Ankara and Islamabad have also signed an agreement for a similar route through Iran. This comes as part of Turkiye’s growing exports in the region as a key logistic hub in the Mediterranean. Such promising projects reduce the cost of exports as well as the export time between Turkiye and UAE to six to eight days and for goods coming from Pakistan to 10-12 days only.
According to the project, Turkiye will benefit from the use of Bandar Abbas port in Iran as shipments arrive from UAE’s Sharjah to the Iranian port then start their journey within Transports Internationaux Routiers (TIR) to the Bazargan-Gurbulak border crossing between Iran and Turkiye. Travelling this route, the shipment only takes around a week. TIR enables goods to transit from a country of origin to a country of destination in sealed load compartments that are controlled by customs via a multilateral, mutually recognised system.
Two-thirds of time saved
A pilot shipment has already succeeded travelling from Ras al Khaimah to Sharjah, then crossing the Arab Gulf to Bandar Abbas port on the Iranian side. The shipment was then directed to the Bazargan-Gurbulak border crossing, reaching Iskenderun on the Mediterranean in Turkiye. The entire journey of the shipment took less than a week. The route could facilitate trade activity in the region, saving two-thirds of the time it takes for a shipment to follow the traditional maritime route via the Suez Canal. The new route contributes to reducing the cost of exports and imports as a result of lower shipment and time costs. In his last visit to the UAE, Turkiye's Foreign Minister Mevlut Cavusoglu said that cooperation is important for all, especially in trade and supply chain resources. Cavusoglu highlighted that both countries are preparing for an agreement on land transportation which is expected to be signed next February when Turkiye’s President Recep Tayyip Erdogan visits Abu Dhabi. Iran welcomed the project, which brings financial and geopolitical benefits as Tehran will profit from tariffs on trucks crossing its lands. Iran will have a tangible contribution to trade movement in the region, alleviating its isolation due to a years-long economic embargo. Iran recently announced the completion of its international road toward the Turkish border, opening the door for similar projects to link Turkiye with the Arab Gulf countries through Iraq. The new land road and other routes will have a regional effect on trade activity and verify the trade routes for Turkiye.