Shipping Giant Invests in Heavy Trucks

The state shipping giant has begun the process of procuring 150 heavy trucks and 12 car carriers with an investment of one billion Birr to transport freight through the Ethio-Djibouti corridor.

The trucks, with capacities to move goods in 20-foot and 40-foot containers, are planned to replace 123 ageing Sinotruk vehicles and 38 Mac Trucks that have been in service for over 15 years and are currently parked at Qality Dry Port. The trucks will be additions to the 475 trucks the Ethiopian Shipping & Logistic Services Enterprise currently operates.

The procurement aims to speed up inland freight transportation service from Djibouti and improve service efficiency and competence of the logistics sector, according to Wondimu Denbu, deputy CEO of the Enterprise in charge of corporate service.

The Enterprise plans to cover 70pc of the cost with loans from the Commercial Bank of Ethiopia and the rest from its own budget.

"Our loan request was approved by the Bank two months ago," said Wondimu, adding that the procurement will be floated as an international tender in the coming weeks.

The trucks will service the import and export of items to and from the seven operational dry ports and Djibouti port, where an aggregate of 24,000 containers are handled at a time, and where 90pc of the country's trade is carried out. Modjo Dry Port, established a decade ago, hosts 78pc of this shipping and logistics services.

Ethiopia's shipping and logistics operations are considered weak and expensive, according to the World Bank's latest logistics performance index that ranks Ethiopia 117 out 190-plus countries for the efficiency of its logistics operations.

The Enterprise, which operates 11 vessels, of which nine are dry cargo ships with a carrying capacity of 400,000tn, had procured 215 new heavy trucks four years ago from Renault Trucks, and it also has two oil transporting vessels, each capable of carrying 42,000tn of oil.