The national flag carrier Ethiopian Shipping and Logistics Services Enterprise (ESLSE) and only African cross continent vessel operator, claims that the permission of reckless waivers is threatening its existence.
The logistics giant and multimodal monopoly said that the behavior of giving waivers to some investors is endangering the enterprise’s identity.
In a press conference held on Wednesday January 25 at the headquarters of the logistics mammoth, the leader of the enterprise said that most of projects carried out by Chinese companies have a leverage of waivers that should be corrected, and further cited that if this is not changed, the activities of the logistics firm will be hampered to a high degree.
“Waivers are posing to be of huge impact to our operation and performance,” Roba Megersa, CEO of ESLSE, said whilst disclosing the six month performance of the 2022/23 budget year’s performance.
“If the waiver permission is not managed properly, the performance of the enterprise, the country’s long established vessel ownership and its flag carrier may be endangered,” Roba expressed his concern.
He added that ESLSE has informed the situation to relevant government bodies to provide tangible solutions.
Roba told Capital that the Ethiopian Maritime Authority (EMA), regulatory body of the maritime sector under the Ministry of Transport and Logistics (MoTL), is giving permits without its mandate that ought to be correct immediately.
“There several project offices at EMA that are supported by foreign funds so financers are interested to encourage the private sector so that they think that giving waiver as a tool is a norm, which is wrong. Now they are permitting waivers for private companies including foreign vessel operators. Almost all Chinese projects are carried out by waiver,” he explained.
“We have informed the case to the Ministry of Finance and the Ethiopian Investment Holding, a mother enterprise of ESLSE. To some extent MoTL is now pushing to stop the activity,” he elaborated the progress being made to combat the scenario.
Roba argued that the free on board (FOB) directive that was issued in 202

1 indicated that waivers were to be given with the consent of carriers, “However they are giving the permit out rightly without our knowledge.”
He also cited instances that the Authority calls importers who are permitted to buy trucks through different letter of credit (LC) scheme to import their cargos through waiver, “which is not appropriate and at the time, we duly expressed our opposition.”
He underlined that commercial banks who assign foreign contractors for their skyscraper headquarter building project are not using ESLSE for their project import, “When we looked into the matter we realized that the contractors are EPC who imported project cargos without ESLSE.”
“When the Commercial Bank of Ethiopia’s building was being constructed, we had indeed provided a waiver as per the request but on the latest case we did not give any permission for other huge building projects,” he told Capital.
As a vessel carrier, the former Ethiopian Shipping Lines was established about six decades back, with its name being changed to ESLSE in 2011 following the amalgamation of other three public enterprises.
So far the enterprise is the sole multimodal operators in the country despite the fact that the government issued a directive that would allow other operators to per take in the scheme.

Capital has learnt that private operators are registering at EMA to join the multimodal operation under ‘Multimodal Transport Operators Commercial Licensing and Competency Certification Directive’ that was issued in 2021.
Under FOB Directive for Deciding Import Goods and Importers Obliged or Not to Import on FOB Term No. 858/2021 waiver system is defined as a permission granted by the Authority to make use of an International Chamber of Commerce (INCO) term other than FOB and/or any other carrier for one time or limited period of time or limited type of shipments for goods or part of goods which must be transported on FOB term according to the FOB directive.
The FOB directive article 4.1 indicated that import goods and importers obliged to make use of FOB term for dry and liquid bulk cargoes, steel, vehicle, containers, break-bulk cargo contained in bags, drums, boxes and project goods procured and imported by government agencies or private enterprises; aid cargos whose transport cost is covered by the Government; project cargo and inputs whose purchase price is partially covered by the government; goods required as an input to produce products by foreign investors for the domestic market;
Article 4.1.E added that the Authority may decide shipments having unique characteristics like fuel to be treated under the waiver system if the situation dictates so.
Under article 13 that stated about precondition for acquiring waiver sub article one stated that goods or part of goods which shall be transported on FOB term according to the FOB directive may be permitted by the Authority for one time or limited period of time or specific shipments to be transported on INCO term other than FOB and/or any other carrier.
Sub article two added that pursuant to sub article one the Authority may permit under any one of the following conditions: when the Authority verifies that the loading port is not served by the carriers or when the Authority verifies that the carriers cannot accept because of the nature of the goods.

Similarly sub article four indicated that any importer who is obliged to import on FOB term according to this Directive but applying to make use of an INCO term other than FOB and/or any other carrier shall first obtain a certificate from any one of the carriers certifying that the carrier is unable to provide the service and must attach same along with the application.
However sub article five of article 13 said that in the event an importer is obliged to import on FOB term, according to this Directive, ships goods on any INCO term other than FOB term and/or other carrier without obtaining prior permission, import of such goods may be permitted by the Authority under a special condition; but sub article six added that the Authority may levy penalty and take administrative measure against importers who import consignment in accordance with sub article five of this article.

US based trading house, Osirius Group, produces a performance bond after two months delay to supply the badly needed political commodity, sugar, in the nick of time.
In the bid opened early November last year, the company which is relatively new to the Ethiopian market was selected to supply 200,000 metric tons of sugar owing to its lowest bid offer compared to other two bidders.
For the past several weeks, the Ethiopian Sugar Industry Group, the commodity client, laid in patient wait for the firm to produce its performance bond to open the letter of credit (LC).
According to the information Capital obtained from Reta Demeke, spokesperson of the Group, it has been revealed that the company has come up with the performance bond.
“The precondition that was supposed to be finalized locally has been fully concluded and the LC has already been opened to harmonize the import,” he said, adding, “the only thing that remains is for the company to finish the process that it has with its bank abroad.”
In the bid documents, the Group expressed its desire for the commodity to be transported up to Djibouti through eight shipments at 25,000 metric tons each. However it stated that the first batch was expected to reach on the third week of November and the last one at the end of January 2023.
Owing to the delay, the dispatching period has been revised explained the spokesperson, “The sweat will be transported in four rounds at 50,000 metric tons each.” Meanwhile he did not provide details when the first batch will arrive at Djibouti since the company is expected to conclude the process with its foreign bank, “we hope the company will settle the process in the coming few days and start the shipment soon.”
On the FOB price offer, Osirius stated that it will supply the commodity on a letter of credit (LC) at sight at USD 545 per ton, USD 522 on 12 months on differed LC and 18 months differed LC. The bid winner cited that the loading port will be Brazil.
The Singaporean company, Agrocorp, which won the last sugar bid opened a year and half ago, offered USD 549.95 for payment at sight and USD 608.75 for 12 months differed LC.
ED and F Man, a British commodity firm, offered USD 850, USD 900 and USD 1,100 per ton for payment at sight, 12 months and 18 differed LC respectively.
The Group, a public enterprise, has accepted Osirius’s offer to supply the sweat with 12 months differed LC scheme with the total cost of the 200,000 metric tons of sugar at USD 11.4 million.
In the 2021/22 budget year, the Group floated several international bids, but was unable to buy the commodity in the year, except the 100,000 metric tons that was supplied early in the year.
Currently, four of the eight sugar mills are in operation, while the market is filed by the commodity currently supplied through francovaluta. For instance, about a month ago, a vessel called Pegasus 01 arrived in Djibouti with 16,000 metric tons of sugar.