Transport Associations Bewildered Amid Reestablishment

May 13 , 2023

Reestablishing transport associations under commercial entities has created confusion among the associations over the implementation. The Ministry of Transport & Logistics put forth a proclamation ratified by the Parliament nine months ago, compelling associations and service providers to reestablish if they are to continue in the public transport business. However, the absence of a directive has led drivers to be denied payments by their consignees and face frequent detainment from passing through the Djibouti border. The law required 65 trucking associations to invest in acquiring a minimum of 50 trucks in four months. Yegna-Helm Transporters S.C. was incorporated with 15 million Br in equity raised from 117 shareholders. The company, under Dejene Luche, had bought three truck vehicles and hopes to raise 100 million Br in the next few years. "There is no directive for a smooth transition," Dejene told Fortune. According to Dejene, even though the company has finished all the preparation, they are still waiting for the directive to see the light of day to get their operational licenses. Dejene believes despite the benefits of reestablishing transport associations as commercial entities; the execution has been rushed. One early re-formed corporate transport firm is Fetan Logistics & Trading S.C., incorporated a month ago with 100 million Br in equity raised from 221 shareholders. "The directive will be ready in a short time," said Yirga Tadesse, the Ministry's road transport monitoring and regulator. According to Yirga, drivers in the meantime, are allowed to cross the border and receive their payment without being detained. "We've started to give out operational licences to the incorporated associations," he told Fortune.


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