Ethiopian Freight Forwarders and Shipping Agents Association

EFFSAA Weekly Newsletter, Vol. 02, No. 085

Dire Dawa Dry Port, Terminal Improves Efficiency of Cargo Movement from Djibouti’s Sea Ports to Ethiopia

The Dire Dawa Dry Port and Terminal was officially opened with a grand inauguration attended by top officials from Ethiopia and Djibouti. This state-of-the-art facility is set to revolutionize the country’s cargo transportation and bring a significant boost to the overall economy.

With a capacity to handle an incredible 128,000 containers per year, the USD 68 million invested in the dry port and terminal has already paid off, with the potential to increase the handling capacity of dry ports nationwide.

The facility’s prime location near Djibouti’s seaports will only serve to enhance the efficiency of cargo transportation. Not only will this new logistics hub generate more income for the country and reduce foreign currency expenditures, but it will also create jobs and stimulate economic growth.

The 34.1 hectares of land on which the dry port was constructed include office buildings, a warehouse, a container terminal, and 10 hectares of internal concrete road.

Its connection to the main Ethio-Djibouti rail line will create a seamless rail cargo operation, according to Ministry of Foreign Affairs.

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Damage to Galafi Route in Djibouti impedes logistics services

The activities of the Ethiopian Shipping and Logistics Service Enterprise are hampered by deteriorating roadways connecting the Port of Djibouti to the Ethiopian border via the Galafi checkpoint, according to the Enterprise.

The freight trucks that transport import and export commodities across the Djibouti corridor have been damaged and require major servicing and repairs because of the bad condition of the road, the Enterprise stated. Vehicles moving freight from Djibouti to Ethiopia face accidents due to damaged roads spanning up to 200 kilometers.

Drivers and cross-border vehicle owners’ associations have repeatedly complained that the issue has been unresolved for many years and that neither the Djibouti nor the Djibouti government has proposed a solution.

Over 80 kilometers of Djibouti’s 200 kilometers are damaged.

The Enterprise has claimed that it will be unable to complete the three monthly journeys via the Galaffi route. Discussions have taken place with the head of the relevant Djibouti authority, who has expressed a willingness to repair the 60 km of asphalt road that has been seriously damaged in Djibouti, according to Roba.

Enterprise vehicles presently utilize Dawalle’s route as an alternative, but after Galaffi’s route is reconstructed, the Enterprise anticipates that it will become the primary cross-border trade corridor.

Aside from the Djibouti road, the Enterprise’s vehicles encountered difficulties on highways leading to northern Ethiopia, such as the Abay route and the Wereta-Woldiya route.

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ESLSE voices concern over reckless waiver issuance

The national flag carrier Ethiopian Shipping and Logistics Services Enterprise (ESLSE) and only African cross continent vessel operator, claims that the permission of reckless waivers is threatening its existence.

The logistics giant and multimodal monopoly said that the behavior of giving waivers to some investors is endangering the enterprise’s identity.

In a press conference held on Wednesday January 25 at the headquarters of the logistics mammoth, the leader of the enterprise said that most of projects carried out by Chinese companies have a leverage of waivers that should be corrected, and further cited that if this is not changed, the activities of the logistics firm will be hampered to a high degree.

“Waivers are posing to be of huge impact to our operation and performance,” Roba Megersa, CEO of ESLSE. “If the waiver permission is not managed properly, the performance of the enterprise, the country’s long established vessel ownership and its flag carrier may be endangered,” Roba expressed his concern.

He added that ESLSE has informed the situation to relevant government bodies to provide tangible solutions. Roba told that the Ethiopian Maritime Authority (EMA), regulatory body of the maritime sector under the Ministry of Transport and Logistics (MoTL), is giving permits without its mandate that ought to be correct immediately.

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Logistics giant ESLSE attains success mid budget year despite global bumps

The landscape of containerization operations which the country is keen on expanding for export commodities reels in great performance in the first half of the budget year.

The role of the logistics giant, Ethiopian Shipping and Logistics Services Enterprise (ESLSE) has been noted as crucial in supporting the scheme since it has contributed to positioning its empty containers for exporters.

ESLSE disclosed that despite the logistics sector globally being in challenging circumstances including the aftermath of COVID 19 and conflict between Russia and Ukraine, the logistics enterprise still managed to attain massive success in the first six months of the 2022/23 budget year.

Roba Megersa, CEO of ESLSE, while providing insights on the matter said that the COVID 19 impact is still affecting the logistics sector, “Food commodities prices are very high, port congestions is still there, containers congestions is eight folds compared with pre COVID period. Similarly, the container operation rate has shown reduction mid-2022 but picked up again significantly at the end of the year with petroleum price and commodities also increasing.”

“Vessel operation cost has also continued at exaggerated price, and similarly the Ukraine Russia conflict has impacted the sea voyage and logistic operation,” the CEO said.
These situations affect Ethiopia’s logistic operation besides the shortage of hard currency.

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