The groundwork for the much-anticipated cool chain logistics system will be laid in Mojo Green Logistics Hub very soon, Capital has learned.
A few years ago, a proposal was created to incorporate a new export category for agricultural products.
A national logistics initiative called Cool Port Addis aims to establish supply networks for perishable goods at a dry port facility located in Mojo, 74 kilometers east of Addis Ababa.
According to experts in the perishable industry, logistics account for 60% of the overall operation when delivering goods to the market. However, in Ethiopia, high costs are a result of a lack of coordination and developed facilities for shipping goods by vessel, as opposed to the currently used, highly expensive air cargo service.
The project was started a few years ago, and although it was expected to start fairly quickly, it has taken longer than expected.
The Ethiopian Maritime Authority’s (EMA) Ergana Buche, Coordinator for Cool Chain Logistics, acknowledged the assertion but countered that the project’s lengthier start date was caused by its complexity and being very new for the nation.
He told Capital, “We cannot say it is delayed because the project is undertaking from scratch as an ice-breaking initiative for the country,” adding that the private sector might not find it appealing at this point.
According to Ergana, the project’s groundwork, backed by the technological know-how of Flying Swans, a Dutch company, will begin in the upcoming months.
The project, projected to cost around USD 50 million, will be carried out in two phases and is funded by the governments of Ethiopia and the Netherlands.
“It may cost USD 26 million for the first phase, which will start in the next four months,” stated Ergana, the initiative’s focal person at the logistics industry regulating body, EMA.
In addition to a cutting-edge cooling system, the facility that would support the export of fresh fruit and vegetables at a competitive rate will feature a stacking area for full and empty reefer containers.
A comprehensive variety of value chain services, including automated staffing, grading, packaging, labeling, and sorting, are also provided by Cool Port Addis.
The Cool Chain Coordinator clarified, “The project would be built to a global standard, and its handling capacity would be 242,000 metric tons per annum. As a nation, it is a very huge capacity.” “It will happen in two stages because the facility has a large capacity,” he continued.
In addition to handling other fruit and vegetable goods and secondary flows like perishable medical imports and flower and meat exports that could interact with the cool port and its facilities, the project is primarily intended to manage the growing avocado production.
Based on the plan, the railway system that directly connects Addis-Djibouti will incorporate the new facility. As Ergana mentioned, the SGTD port in Djibouti is one of the most modern port facilities in the region. It already includes a cool cargo handling system that would allow the shipping of perishable goods in good condition.
The Netherlands’ Minister for Foreign Trade and Development Cooperation, through Invest International, recently signed a 10.6 million euro grant for the project’s first phase.
The Ethiopian government will pay the remaining amount to implement the much-anticipated project.
“When it becomes operational, the project will be handled by those who are leading the effort and will be transferred to Ethiopian Shipping and Logistics (ESL),” Ergana states.
He adds, “Skill transfer and other capacity building initiatives will be taken prior to the transfer of the facility to ESL, the state-owned logistics giant that also operates Mojo.”
Flying Swans, which is supporting the opening up of perishable export markets with sustainable momentum, is working on logistics initiatives in emerging nations.
Ethiopia hopes to replace its current air freight with a competitive transportation model for fruit and vegetable exports that are grown in the nation under favorable climatic conditions.
Experts, such as Tewodros Zewdie, Executive Director of the Ethiopian Horticulture Producer Exporters Association, support the idea that, with the right logistics infrastructure in place, the avocado industry in particular would surpass the hard currency revenues of the industry.
Beginning with a smallholder-driven avocado business, this planned facility has the potential to accelerate the creation of a large-scale fruit and vegetable export sector.
