The impact of adding the Northern sea route to the Belt and Road Initiative for Europe : a chain cost approach

• Published in: Transportation Research Interdisciplinary Perspectives
• Main Authors: Pruyn, J.F.J., van Hassel, Edwin
• Format: Article in Journal/Newspaper
• Language: English
• Published: 2022
• Subjects: Economics; Northern Sea Route
• Online Access: https://hdl.handle.net/10067/1894050151162165141; https://repository.uantwerpen.be/docstore/d:irua:13355

Abstract: In this paper, the possibility of adding the North Sea Route (NSR) route to the Belt and Road Initiative (BRI) is researched whereby the main aim is to determine if it is possible to set up a container service via the NSR route that could attract cargo from the existing maritime routes via Suez and the land route. In order to make the analysis, a model which is able to calculate the total generalised chain cost for a supply chain is used and updated. This analysis shows that it is possible to set up such a competitive service compared to the land bridge and the Suez Canal Route (SCR) for cargo that has a high value of time. For these specific cargo types, it is possible to attract cargo for the NSR from the SCR at equal costs, but with an average time saving of 10%. Comparing the BRI or land bridge to the SCR, there is a cost increase of 20% and a time decrease of almost 65%. Considering the rather strict limitation in capacity, it should be noted that a single NSR service of eight 5,400 TEU vessels already offers around half the capacity of the land bridge. The uncertainty in arrival times, however, would remain an issue in the NSR service, but with ice diminishing, this risk will decrease as well.