NEK-CL: Service Without Boundaries
It is undeniable that, given the current international division of labour, intense market competition and a reduction in vacant market niches, the policies of companies operating in the same industry should focus on combining their potential. Although this trend is of a global nature, this does not mean that it will lead to economic monopolization. In any case, this is the only way to enhance the effectiveness of a company, reduce its production costs and bring down the prices of its goods and services.
It seems that both the heads of the CIS countries and heads of the enterprises operating in them have come to realize this obvious truth. Certainly, no one can change the geoeconomic situation but, by concentrating on joint efforts, the barriers separating states can easily be surmounted. The most striking illustration of this principle is in Europe which, despite all its problems, has managed to become a single integrated community. The political ambitions of the leaders of the European countries have yielded to common sense and an appreciation of the fact that integration offers advantages to their states both internationally and in solving internal problems.
The CIS countries are also integrating, though the process is plodding along slowly. The period of disintegration is nearing its end, as is evident from intensive collaboration between Russian and Kazakhstani enterprises. A case in point is the co-operation between NEK, the largest forwarding company in Russia, and Central Logistics which, according to most experts—including Russians—is the most promising company in this field in Kazakhstan.
NEK is a reputable transnational holding company established in the early 1990’s, with offices and representatives in Russia, Kazakhstan, Ukraine, Belarus, Azerbaijan, Georgia and Uzbekistan. The company is on good terms with its partners in some 30 foreign countries; this allows NEK to provide quality services both in the CIS and around the world.
Ever since it was established, the company has focused on providing a full range of services to Russian and international enterprises in the oil and gas industry. It offers innovative transportation concepts for worldwide delivery through on-site offices and established partners in American, European and Asian countries.
NEK provides full forwarding services including rail, road, air and sea transport, forwarding, storage and insurance of goods, and customs clearance services. The company’s rapidly expanding list of customers includes Tengizchevroil, Siemens, Halliburton and Petro-Alliance among others.
Central Logistics is less well known due to its short life: the company was only set up in 2002. However, its “infancy” does not affect its competence or potential. The qualified specialists at Central Logistics have seven years of experience in customs clearance, so they are well versed in the details of custom formalities. They also have five years of experience in logistics and transport services. Due to their in-depth knowledge of customs operations, the Central Logistics personnel can make prompt decisions regarding customs clearance that allow the company to improve its quality of service, save time and protect its customers’ interests.
This description is not just advertising hype. Those who are familiar with the history of the Kazakh customs service will know the names of Iskender Syrgabekov, Co-chairman of the Board of Directors of Central Logistics, and Yermek Kozhabergenov, Chief Executive Officer of the company, who carried out the initial development and testing of the Integrated Computer-Based System for the Kazakh Customs Committee, which is currently being used by the Kazakh customs.
It is natural that a company with highly skilled specialists like these should have created a software product of its own. The ??? CL programme, designed to draw up customs documents and compile electronic copies, allows the procedure to be accelerated and the prices charged for services to be brought down.
Central Logistics has representative offices in Atyrau, Aqtau, Tengiz, Bautino, Almaty, Astana, Kokshetau, Kyzylorda and Aktobe. Due to this extensive network, the company is able to service cargo traffic crossing the Kazakh-Chinese frontier, and also carry out customs clearance and handle cargos for the leading oil and gas companies at the key crossroads in Kazakhstan, such as Aqtau port and the international airports at Almaty, Astana and Atyrau. Over 500 large enterprises figure among Central Logistics’ customers.
Naturally, competition was inevitable between these two companies, both of which operate in the transport services market for the Kazakhstani oil and gas sector; their heads have made no secret of the fact. In any case, the battle for customers resulted in the establishment of this joint venture. The companies have arrived at the sensible decision that their undertakings will be more efficient if working jointly.
According to the managers of NEK and Central Logistics, their co-operation is simply for economic reasons. At a recent press conference in Atyrau, Iskender Syrgabekov said: “We are not amalgamating in order to retain our large-scale projects and customers, nor to drive our competitors out of the market, but to set up a strong company which will operate both in CIS and European countries.” Mr. Syrgabekov believes that this association was made possible by the fact that the two companies “have a similar range of activities, and comparable profiles, tactics and methods” and when integrated, they will become “a far stronger company, which will be able to meet the highest standards and face up to competition from its counterparts from the West.”
Georgy Kuznetsov, Director of the NEK Holding Closed Joint-Stock Company, added: “We intend to become a logistics operator whose activities are not limited to transport and customs clearance services.” In other words, there is not a hint of politics; the merger is for purely economic reasons.
The companies’ executives did not avoid the truth. By comparing the advantages and disadvantages of the new joint venture, it became clear that the benefits prevailed.
Firstly, NEK-CL plans to take part in servicing joint Russian-Kazakh projects for developing hydrocarbon fields in the Caspian Sea. It makes sense for this work to be done by local companies that understand the customs and tax legislation applied in Russia and Kazakhstan. The effectiveness of this association is clear, especially taking into account that the harmonization of these laws within the Common Free Market Zone is in the pipeline.
Secondly, NEK’s administrative and physical resources, as well as its experience in logistics and cargo transport, will be combined with Central Logistics’ expertise in certification, customs clearance and customs formalities. The establishment of NEK-CL as a separate operational structure will allow its specialists to make progress more rapidly and, as a result, expand the facilities of both companies, reduce the time for customs clearance and bring down prices for customers.
Thirdly, considering the nature of the customers of both companies, NEK-CL JV has a focus on servicing the large oil-producing enterprises in the area of logistics and customs formalities. NEK-CL regards itself an international company, and the experience of NEK and Central Logistics in dealing with foreign partners will help their joint venture to eliminate all boundaries so far as their customers are concerned. Moreover, considering the planned extension of activities by NEK-CL into international logistics services, the newly established joint venture is expected to progress beyond the limits of the oil and gas sector.
There is a further point worth noting. If it is not to find itself outside the globalization process, our country must set its priorities for strategic development. NEK-CL has declared that it adheres to the idea of Eurasia as a common economic, political and information space, a view that is also advantageous to the establishment.
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