There are numerous opportunities to further integrate Europe with Central Asia and the Caucasus by upgrading shipping infrastructure around this body of water.
The strategic significance of the Black Sea in the context of ongoing Russian military aggression against Ukraine is hard to overestimate. This has long been apparent to the Russians and has shaped their behavior in occupying Crimea since 2014. The Crimean peninsula was the first target for annexation by Russia in 2014, creating a staging area for military and security impact on the Black Sea and Eastern Mediterranean. Unfortunately, it took a full-scale Russian invasion of Ukraine for the United States and the West in general to fully comprehend the strategic importance of the Black Sea.
Trade is one of the key factors which forms its strategic value. The sea is a crucial link between commodity producers and global markets. The Black Sea ports of the Russian Federation are major outlets for Russia’s commodities exports. However, the Black Sea also holds vital economic significance for Ukraine, Romania, Bulgaria, Turkey, and Georgia, as well as all landlocked countries connected to European, African, and global markets. It is a vital lifeline for goods like grain, coal, oil, liquefied petroleum gas, and fertilizers.
Ukraine demonstrated incredible resilience on battlefields across all frontlines, including in the Black Sea, where it destroyed a significant portion of Russian navy assets, forcing the rest of Russia’s fleet to hide in ports east of Crimea. Military efficiency allowed Ukraine to provide safe passage for commercial vessels exporting different commodities, not just grain, under the temporary deal with Russia. This helped Ukraine to reach pre-war levels of seaborne exports in 2024.
Overall trade in the Black Sea increased significantly in 2024, driven by the growth of container shipments to Romanian, Bulgarian, and Ukrainian ports, including Constanța in Romania, Varna in Bulgaria, and ports in Odesa, Chornomorsk, and Pyvdenny in Ukraine. The container volume also increased in Russia’s port of Novorossiysk and the Georgian ports of Poti and Batumi. The later ports are primarily servicing the South Caucasus and Greater Central Asia region. The growth is expected to continue, with further restoration and expansion of direct container connection to Ukrainian ports.
The Black Sea is an important channel for connectivity of the Three Seas Initiative (3SI) countries. 3SI aims to promote cooperation for the development of infrastructure in the energy, transport, and digital sectors for twelve EU member states around and between the Baltic, Black, and Adriatic Seas. It also seeks to break decades-long energy and infrastructure dependency on Russia. The Black Sea’s improved connectivity with Greater Central Asia via the Caspian Sea and the South Caucasus will serve the key objectives of the 3SI.
In terms of intra-Black Sea region trade, littoral states trade extensively with each other, and the volume and value of that trade is growing. The sea is also connected to the Danube corridor, providing access to the Balkans and Central Europe.
The largest Black Sea ports of the littoral states serve not only domestic markets but also transit cargo moving in and out of the wider region. There is a relatively well-established infrastructure connecting the economies of regional countries to their major ports. However, there is a lack of linkages between different regions and countries, which could maximize trade and transit opportunities.
This includes connectivity between the countries of Eastern and Central Europe, between the Eastern and Western shores of the Black Sea, and between the Caspian and Black Seas. There are some creative ways to address some of these challenges. One of them is the utilization of the so-called short-sea shipping in the Black Sea.
Short sea shipping (SSS), according to the Eurostat’s glossary, refers to “maritime transport of goods over relatively short distances, as opposed to the intercontinental cross-ocean deep sea shipping.” According to the EU’s transport statistics, SSS is defined as “maritime transport of goods between ports in the EU (sometimes also including candidate countries) on the one hand and ports situated in geographical Europe, on the Mediterranean and Black Seas, on the other hand.”
With better coordination and management of existing maritime assets in the Black Sea, SSS may be a straightforward way to enhance connectivity between different countries of the Black Sea, which in turn will help address the transportation needs of Eastern European economies, including Ukraine, the South Caucasus, and Central Asia. Once the advantage of SSS is demonstrated, it may encourage new infrastructure investments and development.
For the moment, the Black Sea lags behind the Mediterranean, North Sea, and Baltic Sea in terms of volumes of short-sea shipping, accounting for only 6.5 percent of the EU-27’s SSS volume. Most of the SSS in the Black Sea takes place between Novorossiysk, Varna, Constanța, and Istanbul. In 2023, liquid bulk, like oil and oil products, accounted for 50 percent of total SSS in the Black Sea. However, there are great opportunities to increase general cargo and container shipments between the Eastern and Western shores of the Black Sea using short-sea shipping. This will be a major boost for trade between Greater Central Asia and Eastern and Central Europe, contributing to economic growth and development.
As mentioned, the Port infrastructure around the Black Sea is relatively well-developed, missing just one major element: deep-sea ports on the eastern shores of the Black Sea. The planned Anaklia port in Georgia will significantly improve the potential for Eastward connectivity of the Black Sea, affecting the scale and the cost of transit between Greater Central Asia and Europe. While Anaklia’s priority will be long-haul shipping, its construction will open more opportunities for shipping in the Black Sea via Anaklia and other Georgian ports.
The countries of Greater Central Asia, including the littoral states of the Caspian Sea, are investing significant resources in developing transit infrastructure projects, such as railways, highways, and ports. Major international financial institutions, such as the World Bank, the Asian Development Bank, and the European Bank for Reconstruction and Development, are in the process of financing these projects. These elements of infrastructure are essential for Central Asia-Caucasus-Europe (CACE) connectivity, which will greatly increase the sea’s strategic significance and ensure the commercial viability of its ports.
These developments on the Eastern Connection of the Black Sea can generate more cargo for ports not only on the Eastern shores of the Black Sea but also for Constanța in Romania and Varna and Burgas in Bulgaria as well. Once the Russian invasion of Ukraine ends, shipping between Georgian and Ukrainian ports will be a major channel of trade, contributing to Ukrainian reconstruction and development.
About the Author: Mamuka Tsereteli
Mamuka Tsereteli, PhD, is a Senior Fellow at the American Foreign Policy Council/Central Asia-Caucasus Institute.
Image: Mister Din / Shutterstock.com.
