Bruce Barnard, Special Correspondent | Nov 29, 2011 8:34AM EST
Fesco, owner of Russia’s largest ocean carrier, has secured a $135 million loan from the European Bank for Reconstruction and Development to fund the upgrade of container facilities at the port of Vladivostok in Russia’s Far East.
The seven-year loan from the European Union’s long-term financing arm will also finance the modernization of Fesco’s intermodal operations across Russia.
“The aim is to turn Vladivostok into a modern, clean and efficient port focused on handling high-value and environmentally friendly cargo, particularly in containers,” the EBRD said.
Most of the port infrastructure in the Russian Far East was built more than 50 years ago and the current lack of port and inland terminal facilities has created bottlenecks, the Luxembourg-based bank said.
“The Vladivostok project is vital for expanding freight traffic along international transit routes running through the Russian Far East.”
The EBRD said that as one of the few companies in Russia that owns facilities at every stage of the logistics chain, including shipping, port and railway facilities. Fesco can offer shippers a single service intermodal transportation system, especially in containers.
The loan will help Vladivostok service growing volumes of bilateral trade between Russia and Asia-Pacific countries, according to Fesco Chief Financial Officer Yury Gilts.
Vladivostok’s container traffic grew 28 percent in the first nine months of 2011 from a year ago to 314,369 20-foot equivalent units. Fesco’s intermodal traffic soared 52.5 percent to 52,269 TEUs and rail container shipments jumped 34.5 percent to 185,788 TEUs.
EBRD acquired a 3.7 percent equity stake in Fesco in 2008.
-- Contact Bruce Barnard at brucebarnard47@hotmail.com.