Addis Abeba Taxi Fares Stay Frozen While Fuel Costs Soar

Dec 6 , 2025. By SURAFEL MULUGETA ( FORTUNE STAFF WRITER )

A long-promised transport fare revision in Addis Abeba has been delayed again, leaving thousands of drivers and commuters in limbo. According to federal transport authorities, the new tariff is “expected within two weeks,” but no official start date has been issued. Frustrations are mounting amid economic strain and conflicting signals from the federal authorities.

A long-promised revision of transport fares in Addis Abeba remains in limbo, heightening tensions in a city already strained by the high cost of living, fuel price hikes, and a transport system buckling under demand.

A new tariff, promised to take effect within two weeks, lacked an official start date or publicly posted structure, leaving drivers and the public guessing what to expect. Repeated postponements have further eroded trust in federal transport authorities, who are facing sharp criticism from both sides of the divide in the transport sector. Climbing fuel costs and escalating costs of leaving are making it harder for drivers to stay afloat, while passengers struggle to cope with the ever-increasing cost of living.

Officials at the Ministry of Transport & Logistics (MoTL) concede as much, claiming the adjustment is meant to restore fairness to a sector battered by relentless price pressures and economic volatility. According to Assefa Hadis, a transport service and supervision advisor at the Ministry of Transport & Logistics, the new adjustment is one part of a larger effort to create “fairness" for both taxi drivers and taxi users.

“We've been receiving various complaints about this issue," Assefa told Fortune. "In response to the taxi drivers’ concerns, we're in the process of implementing a new tariff.”

The Ministry’s goal, according to him, is to account for both fuel and spare parts costs so that drivers can earn a reasonable income without making fares unaffordable for passengers.

“We expect to have it established within the next two weeks,” he disclosed to Fortune.

However, a lack of clear communication from transport authorities and shifting deadlines has stoked tension. Drivers say they are losing patience with promises that never materialise. Passengers, already burdened by high expenses, are anxious about potential cost increases and the broader economic fallout.

The current tariff is out of sync with the market after a year of rising fuel costs and frequent price adjustments. The delay in adjusting tariffs, which has stretched for over a year, is putting many under severe financial strain. Their incomes have been eroded by surging inflation, rising fuel prices and soaring spare parts costs, even as the fare they charge passengers remains unchanged.

Yohannes Genanaw, a Code 1 taxi driver who has worked the streets of Addis Abeba for more than a decade, called the need for a new adjustment “long overdue.” Fuel prices have gone up three times since the last fare was revised a year ago.

“The price of fuel affects us more than anyone else,” Yohannes said. “There has been no improvement in taxi fares. This is outrageous. We have been struggling to make a living and provide for our families.”

Yohannes earns a daily average of 3,000 and 5,000 Br, but about half of that goes straight into the fuel tank. A litre of benzene at the pumping station costs 122 Br, while the tariff he works with is based on the previous rate of 80 Br.  The gap between his earnings and expenses has grown so wide that making ends meet is becoming increasingly difficult.

“Everything has doubled these days," Yohannes told Fortune. "But, we're still working with last year’s tariff. It’s becoming impossible.”

For years, public transport tariffs lagged behind inflation, maintained at levels that often defied economic logic but echoed political caution. The transport tariff regime issued in October 2024, 4.5 Br to 65 Br for minibus rides, seven Birr to 35 Br for city buses, and a still-subsidised two to six Birr for light rail journeys, introduced a tiered system meant to mirror actual travel distances and operating costs.

For experts like Ashu Sintayehu, who has a background in transport systems engineering and more than seven years of experience in the field, this change brought long-overdue coherence to a system beset by fare inconsistencies and ad hoc adjustments, but it arrived at a time when rising living costs were already squeezing households.

Ashu understands why tariff adjustments are slow, for the country does not set global fuel prices and derives little benefit from international fuel market changes; adjusting every sector affected by fuel price swings would destabilise the entire economy.

“We don’t control the fuel market,” Ashu told Fortune. “We don't determine the changes in fuel prices. If we try to adjust everything influenced by fuel prices every time the market moves, we can't keep the economy stable.”

Other drivers, like Girma Bulbula, share similar stories. A Code 3 taxi driver with 20 years of experience, Girma feels that the financial pressure is pushing him to his limits. The cost of a tyre is more than 13,000 Br, and a battery costs 15,000 Br.

"Everything is so expensive these days,” he said.

Last year’s tariff revision added only five Birr to most routes, which Girma feels is not nearly enough to cover rising expenses.

“This is not bearable,” he said.

Girma has to work more than 16 hours a day, often skipping breakfast and having meals twice daily to save money. Yet most of his daily earnings, about 5,000 Br, are spent on fuel and maintenance.

“If things don’t improve, I'll be forced to stop working,” he said. “But I don’t know what I would do if I quit taxi driving.”

There are roughly 9,000 registered blue-and-white taxis like Yohannes's that dominate the mobility landscape not through planning but through sheer necessity. Operating across more than 1,200 routes, many mapped by usage rather than design, they, and the white vans operated by drivers like Girma, fill the void left by an overstretched formal network. Recent figures show that minibuses account for 80pc to 88pc of all motorised public trips, equivalent to 1.5 million to two million passenger boardings daily.

These vehicles represent the connective tissue of the city’s mobility system, offering door-to-door flexibility, frequency, and a responsiveness that larger municipal operators struggle to match. Data on urban mobility is hard to come by. The latest, from 2018, revealed that public transport accounts for 31pc of all trips, walking 54pc, with private cars around 15pc. Daily trip counts across all modes, including Bajajs operating in the outskirts, range from seven to nine million, figures that are increasingly obsolete as both population and urban sprawl surge.

Anbessa and Sheger buses operate over 1,100 buses, serving about 1.2 million passengers daily. The bus system, despite being subsidised and municipally backed, is frequently constrained by fleet age, maintenance backlogs, and route inflexibility.

Taxi associations have repeatedly raised the issue with the federal transport authorities. According to Getu Tesfaye, president of Selam Taxi Association, which has more than 450 members and has been in operation for 15 years, the lobby group has been requesting a tariff adjustment for more than six months.

“We've been asking for an adjustment in our taxi fare due to the increase in fuel prices,” Getu said. “The fuel price and taxi tariffs should be aligned. Otherwise, the livelihood of taxi drivers can become very challenging.”

According to Getu, the cost of spare parts, engine oil and basic maintenance has reached levels many drivers can no longer afford.

“An increase of five Birr won’t suffice this time," he told Fortune. "We need a viable solution to the issues we're facing. A fuel subsidy would help improve our situation.”

The Ministry acknowledged the delay, but its officials say the decision is tied to a broader government push to standardise taxi pricing between Addis Abeba and Sheger City, its rapidly expanding outskirt. Until now, different tariff structures have been used at the boundary, as transport bureaus in the respective regional administrations conducted their respective research and made independent decisions.

Bareo Hassen, state minister for Transport & Logistics, disclosed that his Ministry is now working with the Addis Abeba Transport Bureau and the Oromia Transport Authority to create a consistent system.

“However, we're now working together under the Ministry to ensure a uniform fee on both sides,” he told Fortune.

Officials from the Addis Abeba Transport Bureau were not available for comment, despite repeated efforts.

The Ministry sent the proposed new tariff to regional governments more than a month ago, and it is the same approach that will be used for Addis Abeba and its surrounding areas as elsewhere in the country.

“We're conducting research and working to ensure that it is fair and affordable for everyone,” Bareo said.

While drivers wait for relief, passengers worry about how a potential fare hike will hit their purses. Many find that transportation costs already take up a large share of their monthly income, especially as other living expenses rise.

Mekdes Mekonnen, an accountant at a private company near Alem Cinema in the Bole area, commutes from the Yerer St. Urael Church area, about a five-minute trip from Goro roundabout on Cape Verde St. Her journey to work costs her 35 Br one way, over 70 Br a day. She lives with her sister in a rented house that costs 10,000 Br a month, and says the rising cost of city living makes even small increases difficult to bear.

“The salary adjustment implemented for government workers didn't extend to private sector employees,” she said. “Everything is showing an increase. If they raise fares further, I don’t think I can keep up. I'm already struggling as it is,” she said.

Other passengers recognise that drivers have it tough, too, but have their own troubles. Abreham Ayele, who works at a printing shop in the Megenagna area, in front of Zefmesh Building, travels daily from Tor Hayloch on Ras Mekonnen Avenue. His biggest complaint is a shortage of taxis in the city.

“I understand that taxi drivers are struggling,” Abreham said, “but the lack of available taxis is still a major problem for me.”

The taxi queue in his neighbourhood is always long, forcing him to wait between 30 minutes and an hour for a taxi. Abreham often leaves his home at 7:30am, but because of long queues and the need to take two taxis, he arrives at work as late as 9:30am, spending more than 60 Br every day.

Retailers such as Zewdu Asefa, who owns a small shop in the Gotera neighbourhood of Qirqos District, behind the Oilibya gas station, are also watching closely. Transportation is a major operating expense for him as he buys products in bulk from Mercato. Getting a full load delivered can cost more than 1,500 Br, a fee that doubles after 7pm.

“We factor the taxi costs into the prices of the products we sell,” Zewdu said. “If the taxi fare increases, our prices will also go up.”

He believes better communication is needed before any new tariff is imposed.

“People need to understand that we are facing these problems just like anyone else,” said Zewdu.

Ashu is optimistic about federal authorities' push to expand electric vehicles, arguing that a managed transition could eventually reduce dependence on imported fuel and limit the effect of global price shocks.

“If implemented properly, this initiative can diminish our reliance on fuel and mitigate its impact on our daily lives and the economy as a whole," he told Fortune. "However, it still requires more work.”

Yet, the expert warned that ignoring the direct consequences of fuel price fluctuations is a mistake, since these costs are already showing up in household budgets and transport bills.

“We need to align economic theories with the reality on the ground,” he said.

PUBLISHED ON Dec 06,2025 [ VOL 26 , NO 1336]