Ethiopia: Private Investment to Be Allowed in Multimodal Transportation

Ethiopian Government is considering to let private investment in the multimodal (land, sea or road) transportation services.

Ever since the government three years ago introduced the multimodal scheme, it has been controlling the system on monopoly basis.

However, businessmen engaged in the logistics service have been complaining and even raised the matter to the Prime Minister.

It was in the aim of boosting the multimodal system that the Federal Government established an enterprise after merging three enterprises; Ethiopian Shipping Lines, Dry Port Services and Maritime Enterprise.

Now the government has stated it intends to include the private sector and according the State Minister of Transport, Getachew Mengiste, it is in the aim of speeding up logistics facilities.

“We are considering how the private sector will take part in the multimodal scheme,” the state minister explained. “We will not decide by our self but we will involve other stake holders and we will discuss it thoroughly.”

Nonetheless, he refrained from stipulating the exact time when the government will allow the private sector to engage on the scheme.

According to the State Minister, the government has been working in the past three years to deliver products in seven days but the goal is to reduce this to five days.

‘‘We are drafting the documents that will allow the private sector to get involved in the multimodal scheme. Then we will conduct a meeting to have a feedback from stakeholders,” he added.

The current directive, Multimodal Transportation Implementation Directive, requires all shipments that belong to the government to use multimodal transport through Ethiopian Shipping and Logistics Services Enterprise (ESLSE). It also states all vehicles of three Tones or less to be under the new scheme and goods being shipped through the ESLSE to use multimodal transportation service.

According to Capital, multimodal is a system where transportation of goods is under a single contract yet performed with two or more different transportation means. Under this scheme, the transporter is accountable for the entire journey, including the shipment’s delivery to its destination.

Source: Capital