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The Federal Transport Authority issued a new scheme raising truck fleets to 125 for transport companies serving to and from the Port of Djibouti. The new scheme shall be operational as of the beginning of 2014 and accordingly shall revoke the work permits/licenses of those that have less than 125 trucks in their fleet.
Previously, the government or other importers were dealing with individuals or companies to transport their cargo regardless of their truck fleets. This system forces the authority or other major importers to deal with many transporters on an individual basis to transport their cargo leading to confusion and inadequate management, according to experts.
Sources in the sector told Capital that the new arrangement ratified will allow the Authority to control and harmonize the sector and minimize the number of deals and permits that the authority enters into with transport providers. Associations or individuals, having 125 trucks or more, are the only bodies that can join the new scheme and obtain transport permits as of January 2014.
Sources told Capital that the deadline to get the new license is set for January 8th, but officials at the Authority declined to specify the exact date.
Abelneh Agidew, Public Relations head of the Federal Transport Authority, told Capital that the new scheme aims to avoid the confusion that existed for a long period without any clear data or information.
“The sector has been led by illegal actors and brokers and not by owners and companies that is why we formed the new arrangement,” he clarified.
“After the 2008 Business Process Reengineering (BPR) study we have been working to modernize the public transport sector and now the cargo transport modernization process has commenced,” Abelneh said. “The new arrangement is crucial to go with the country’s development and the international trend,” he added.
He said that for the past year the authority with other stakeholders have been discussing the new arrangement and most of the transport actors have agreed with the merits of the new scheme.
Even though the authority said that 125 trucks is the minimum number of fleet to get the transport license, the reality is that the number of companies or individuals that have that many fleet are very few.
According to sources, transport companies and individuals that have few trucks are currently working to form associations to meet the minimum number of trucks required by the authority.
“We will give licenses and permits to these associations but the number of fleet is not the only criteria as institutional arrangement, professional workers and type of trucks by production date and loading capacity are some of the criteria needed for the permit,” the public relation head explained.
The new law will force transport companies or associations that form to be led by professionals and are expected to compile detailed data and information about their business.
“According to our plan the new registration and licensing process has commenced in the middle of November,” he added.
He said that some of the associations that have formed based on the new law are currently approaching the authority to get their licenses and some of them have also started the licensing process.  
According to experts in the sector, there are about 25,000 trucks operating in the country with a capacity to carry 100 quintal and above. However, most of these trucks are older models. Abelneh told Capital that currently the authority is working on a detailed study about the existing number of trucks and their condition.
Different studies undertaken by local and international organizations indicate that today the transport system is one of the major obstacles for the logistics sector. Most of the sector actors are not professional and the sector is not even led by the companies or owners. Brokers based in Ethiopia and Djibouti are the major actors servicing both clients and truck owners.
The government also does not have detailed information or controlling mechanisms for the sector, while it is applying several plans to modernize the sector. For instance, the public transport system is not modern and it has also classified the public transport vehicles (bus, minibus and other public transport cars) into three levels related to their production date and quality. According to sources, trucks will also be classified based on their quality and model when the authority finalizes the study.