Trio Courts Global Cargo Trade with Ambitious Transit Corridor

Jul 13 , 2025. By BEZAWIT HULUAGER ( FORTUNE STAFF WRITER )

A multimodal logistics corridor linking Ethiopia, Djibouti, and China aspires to reposition Addis Abeba as a new fulcrum in Africa's freight sector.

Backed by an unlikely but potent partnership, the Ethiopian Airlines Group, the Customs Commission, Huawei, and SafeZone Logistics Plc, the initiative intends to halve shipping times, lower transit costs, and circumvent longstanding infrastructure bottlenecks that have stifled regional trade.

The corridor is sought to address a persistent choke point, with Djibouti's airport, which processes no more than 50tns of cargo daily. With air freight between Djibouti and Addis Abeba costing up to three times more than land transport, and often constrained by runway and warehouse limitations, the new tri-modal approach is planned to offer a pragmatic bypass.

Under the plan, goods arrive by sea, transfer via bonded trucks to Addis Abeba, and then ship onward by air, accelerating high-value consignments like electronics and pharmaceuticals.

The model, mimicking global supply chain standards, promises more than speed. By formalising customs, digitising documentation, and introducing bonded warehousing in the capital, the system is being designed for scalability.

The involvement of Huawei, a geopolitical heavyweight, in the pilot phase signals the commercial and diplomatic stakes embedded in the corridor.

Ethiopian Airlines is positioning itself at the centre of this transformation. Dereje Derero, cargo and shipment managing director at Ethiopian Airlines, sees the initiative not only as a new revenue stream but as a strategic leap toward making Bole International Airport a logistics hub for Africa and the Middle East.

For the national carrier, already Africa's largest by cargo volume, the corridor represents untapped potential in intra-African trade, a notoriously fragmented market. Dereje noted that the plan extends beyond imports, allowing finished products manufactured in China to reach new destinations in Africa through Addis Abeba.

"This is an untapped market for the Airline," said Dereje.

A fresh Customs Commission directive underpins the operation. To participate, operators should hold a freight forwarding license, manage an authorised customs warehouse, and post financial guarantees to secure goods in transit. They are required to preregister every shipment through an integrated Customs Management System (CMS), track movements with barcodes or radio frequency identification (RFID) tags, and submit all documentation digitally.

According to the Deputy Commissioner, Azeze Chane, the Customs Commission crafted the rules to align with World Customs Organisation (WCO) protocols.

"We're open to pioneering the logistics industry," he said, describing the corridor as central to "a vision for a stronger, more connected Ethiopia."

He hopes to see the initiative spurring growth in the country's import-export business.

However, the corridor's early implementation reveals a litany of challenges. Legalising a single customs document reportedly took up to two months and 2,000 dollars during the pilot, an unsustainable figure for routine shipments. Access to airport warehouse space has proven cost-prohibitive.

And the Customs Commission's stringent directives, including zero tolerance for unauthorised cargo and liability exemptions for losses, add legal rigidity to an already complex trade ecosystem.

SafeZone Logistics, which spearheaded the pilot's overland and warehousing operations, acknowledged the bureaucratic and operational issues.

Company representative Yonatan Beyene, conceded to the difficulty of negotiating a unified regulatory framework, something authorities of the Customs Commission have long struggled to modernise.

"However, the Commission's new directive enabled us to begin," he said.

SafeZone Logistics sprang to life in August 2020 when the Ethiopian Customs Commission abruptly banned 16 courier companies, including UPS, FedEx and Aramex, for operating without proper warehouse licenses. Four logistics professionals with more than a decade of experience across China, the U.S., and the UAE answered the call from Ethiopian Airlines and customs authorities, pooling what they described as "committed finances" to secure roughly 300Sqm inside the Bole cargo terminal.

Within weeks of incorporation, the company had obtained its warehouse operator license, rented bonded space from the Airline, and reactivated air-cargo flows that had ground to a halt. Acting as the licensed gateway for international couriers, SafeZone Logistics built an in-house warehouse management system, established formal customs-clearance procedures, and quietly resolved the crisis that threatened Ethiopia's air-freight connectivity.

SafeZone is the only bonded-warehouse operator inside the Airline's cargo facility, offering freight forwarding, customs brokerage, warehousing, transportation management, and last-mile delivery under one roof. Since its founding, the company has expanded its storage capacity by at least 50pc and forged strategic ties with Ethiopian Airlines Cargo & Logistics Services, the Ethiopian Customs Commission, and the Ethiopian Freight Forwarders & Shipping Agents Association.

It currently employs 70 people. Yonatan, the company representative, mentioned that he learned through connections that Hiwawe had initiated lobbying efforts to secure an enabling directive from the Customs Commission. This led to a prolonged discussion that remains ongoing. He noted that to begin commercialization of the transit process, a separate warehouse is required. The company has handled major freight forwarding projects with the EU, IOM, the German Embassy, and the Indian Embassy in Ethiopia. Yonatan has nearly a decade of experience in the logistics industry.

With agency networks in more than 3 countries, SafeZone Logistics has positioned itself to capitalise on the growing e-commerce and cargo volumes.

While the firm plans to expand facilities and simplify procedures through an umbrella guarantee system, it remains unclear whether such measures will ease entry for new players.

Industry insiders fear that the regulatory architecture, while aligned with World Customs Organisation (WCO) protocols, may unintentionally tilt the playing field in favour of larger foreign players.

Tewodros Kassahun, a veteran freight forwarder, warned that new capital-intensive requirements, especially in the wake of fuel subsidy removals and soaring trucking costs, could sideline domestic firms already operating on thin margins.

"Foreign companies might have the best chance at this," he said.

Still, Ethiopia is racing to capture a share of a vast and expanding market.

Dubai's Jebel Ali Free Zone processed over 167 billion dollars in trade in 2022, while sub-Saharan Africa imported 422 billion dollars in goods across a matrix of more than 230 trade partners. Ethiopia's ambition to tap even a small fraction of this market depends on reducing red tape, scaling infrastructure, and maintaining price competitiveness.

PUBLISHED ON Jul 13,2025 [ VOL 26 , NO 1315]