Budget Constraints Bind Hawassa Dry Port Dev't

Lack of budget funding has forced the state shipping enterprise to hold off its planned construction of a dry port facility near Hawassa Industrial Park, the nation's flagship park.

The Ethiopian Shipping & Logistics Service Enterprise cancelled the tender announced at the end of April to construct the port, which was to be located 220Km from the capital. A feasibility study conducted by the Enterprise two years ago estimated the construction of the facility along with equipping it with necessary machinery would cost 117.5 million Br.

The Enterprise, which operates 11 shipping vessels, nine dry cargo ships and two oil tankers, has requested the Industrial Development Fund to allocate a budget for the port in this fiscal year's budget, according to Roba Megersa, CEO of the Enterprise.

The Fund, a division under the Ministry of Finance tasked with allocating budgets for the state-owned enterprises while developing infrastructure, did not respond to the Enterprise's request, according to the CEO.

"We've also many other projects that have failed in their implementation due to financial constraints," Roba told Fortune.

CCTV camera installation for the Qality Dry Port and some remaining construction work at Kombolcha and Dire Dawa dry ports are among the projects that failed to secure financing, according to the CEO.

Planned to hold 1,000 containers at any given time, the port facility was designed to have terminals, offices, inspection gates and warehouses. The port has targeted manufacturers in the park and import and export companies in the Southern National & Nationalities & Peoples' Regional State.

"We plan to build the port in Hawassa due to the park and the surplus agricultural production in the regional state," Roba told Fortune.

Built by China Civil Engineering Corporation in 2016, the park has 22 operational companies and hires 24,000 people. These companies generated six million dollars last month from direct exports.

"The port will have an enormous benefit for the existing companies in the park," said Belay Mikaeal, a manager at the Park from the Ethiopian Investment Commission.