The National Dry Cargo Transporter Association has formed a union to try to ease the flow of cross-country transportation. Forty six associations working in the nation’s import/export sector officially formed the union during their first general assembly at Ras Hotel on December 24. Mesele Hagos, head of the new union, told Capital that the formation of a big and organized union is crucial to tackling challenges faced by the sector.
He said that the country’s growing economy requires a modern and fit transport system. “The fast growing demand of the transportation system will be enhanced by being organized so we decided to form this union,” Mesele added.
The sector has been experiencing some problems, according to experts. “There has been hard currency lost because of issues related to demurrage directly related to the lack of a transportation operation scheme,” experts told Capital.
“For instance in the past budget year the port of Djibouti has experienced congestion from vessels that were loaded by aid grain and fertilizer,” experts said.
They added that the major reason for the congestion was not the shortage of trucks but lack of coordination with the fleet. “We can solve these types of problems if we modernize and manage effectively. In other countries the truck unions or associations are responsible for this. Their associations are even responsible for providing accreditation based on the quality of trucks engaged in cargo operation,” a member of the group who started the union said.
“We want to see a strong and organized system in our country,” they added.
“Forming a strong truck owners’ organization like the new union will modernize transportation and grow the economy, with a modern and organized transportation system the economy will become strong and continue thriving,” Mesele said.
The associations included in the union have over 7,000 different trucks.
“All of our trucks are engaged in importing and exporting cargo,” Birehane Zeru, one of the founding members of the union told Capital.
“We have done our part to improve the sector and this will be further helped by new policies and regulations from the government,” Mesele said. According to experts, as per the law Federal Transport Authority has a mandate to form transport associations, but a legal procedure is expected from the Council of Ministers to permit the formation of unions.
“We hope that Ministry of Transport will table the regulation for the Council of Ministers to form a union that can strongly work with the government,” Mesele explained.
“Based on the constitution we have a right to form a union but the government is our major client so we need their recognition,” he added.
“We hope that we can work together to make the sector better,” the founder said.
Industry parks, agriculture and other sectors are growing but the transport sector is not proficient but more imports are coming into the country.
“We are forming the union to improve the management system and improve the truck operation process, while regional competition will come when the country opens this sector to other investors,” Mesele said.
Founders said that the goal of the union is to improve the capacity of the sector and to find ways to improve the availability of modern trucks.
The first electrified railway that connects the central part of the country with Djibouti, the major import/export hub of Ethiopia, is in the final stages of commencing the cargo fleet.
Experts said that despite the new train trucks will still play a vital role in transporting freight. This is because railways depend on trucks to get their products to their final destinations.
Currently the transport and logistics sector is protected for Ethiopians. Lack of a efficient transportation system is one of the major issues mentioned in a recent World Bank report and the National Logistics Strategy that should be developed to continue Ethiopia’s economic growth.