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The Metals Industry Development Institute of Ethiopia (MIDI) is requesting a dedicated sea port at Djibouti, the major Ethiopian logistics outlet, to import metal products in the country, Capital learned.
Sources told Capital that the management of MIDI paid a visit to the neighboring country at the beginning of the budget year to assess the situation and come up with ways to obtain a port.
Ethiopia, which has registered one of the highest economic growth rates in the world, is undertaking massive public and private projects that are pillars to further advance the economic prosperity in the country.
Workneh Delelegn, Director General of MIDI, declined to comment, but a delegation from the Institute apparently visited Djibouti in August this year, according to sources.
These sources added that the Institute is interested in obtaining an exclusive port for metal commodities and that MIDI, which is under the Ministry of Industry, has communicated with the Ethiopian Maritime Affairs Authority (EMAA), the government regulatory body in the sector, to explore the issue.
Sources said that the Institute is also looking to establish a new facility in Djibouti to import the product.
Meanwhile the Institute was looking to form a new facility. The Authority strongly suggested that the country use ports developed in Djibouti and if the Institute needs an exclusive port it can look the developed Port of Tadjoura, which was inaugurated in the first half of 2017 with the goal of exporting potash from Ethiopia, according to sources.
The visit is related with the growing demand of steel and the metal industry in the country.
Sources said that the delegation which visited Djibouti was observed at the site at Obock town, located on the northern shore of the Gulf of Tadjoura.
Mekonnen Abera, head of EMAA, told Capital that his Authority told the Institute that the current facilities in Djibouti are sufficient for handling the specific cargo. “I have told them the current ports and Port of Tadjoura are plenty enough to import the product,” he added.
“How much the country imports and what kind of facility is needed are major issues,” he said.
“It is not necessary to establish a new one looking at the current potential port facilities, roads and distance and developed infrastructure, I cannot propose the new facility,” he added.
The two countries have already agreed in principle to develop a port jointly in the future, according to Mekonnen. “So far we don’t need additional infrastructure and economically it is not feasible,” he added.
The expert at the authority says they may be open to reconsidering in the future. “When the economy is growing and the ports cannot keep up with the demand we will reconsider,” EMAA’s head explained.
Djibouti has aggressively expanding its port facilities throughout the country.
Ahmed Shide, Minister of Transport, told Capital that the studies will cover the establishment of ports in partnership with the government of Djibouti. “This specific issue will be related with these studies,” he added.
Djibouti has a plan to develop ports for specific purposes as the economy grows, according to Ahmed.
He said that the two countries have several dialogues going on about joint investment and they have good practices about joint development. “The railway project, which is very high in terms of investment is a good example,” he added.
Recently, Djibouti inaugurated Doraleh Multipurpose Port (DMP) that cost USD 590 million and Tadjoura. The DMP is one of the biggest port facilities at the region. It can accommodate many vessels at one time. Tadjoura Port, which consumed about USD 80 million, was mainly established to export potash from Afar but now it is possible Ethiopia will use it for other purposes.