Port actors in Djibouti and stakeholders in Ethiopia agreed on the formation of a technical committee that shall solve problems immediately they happen.
The Doraleh Multipurpose Port (DMP), the modern port facility in Djibouti that handles both containerized and bulk cargos, officials met stakeholders from the freight forwarding and transport partners of Ethiopia with the goal of talking about areas considered as a problem on the operation and introduce new changes that the port applies to improve the sector.
At a discussion held on Wednesday and Thursday at Ethiopian Skylight Hotel the DMP CEO Wahib Daher, explained the operation and improvement that the port, which was inaugurated just two years ago, is undertaking. He has also disclosed that since the port commenced operation the logistics charges have been reduced significantly.
In her presentation Elizabeth Getahun, President of Ethiopian Freight Forwarders and Shipping Agents Association, proposed that the formation of a technical committee with the goal of bypassing problems in the sector between the two countries. 
Wahib told Capital that the idea raised by the president of the association is very crucial in order to close the gaps.
“If we continue to meet every two months in Djibouti and Addis it will be very important on to have the milestones and action plans. So on the technical committee will be very important because it will allow having institutional mechanisms in order to tackle all the problems,” he added.
The port has improved but Ethiopians claim that there are several problems in the sector. Ethiopian actors claimed that a delay of cargo mainly when wide bulks like wheat and fertilizer arrives at Djibouti have a problem in their operation.
Freight forwarders have also said that in the region competition is coming so Ethiopia might expand its access to sea via different countries in the region. They said that due to the coming competition the Djibouti sides should have some tariff changes.
“Regarding the port cost I would like to remember that in 2018 we decreased the charge from 20 to 40 percent that has been reported by the Ethiopian media. We are really aware of the competition in the region so we want to be chosen by best services under the competition,” the DMP head responded.
The port officials said that the grain or fertilizer arrival does not have any problem on the port activity it is all about the trucks.
Eyob Tekalegn, State Minister of Finance, mid of the week told media at the press conference that the government is working to harmonize the procurement and arrival of bulk commodities unlike the previous poor operation. “The new operations will easy the activity at the port since products will arrive at the port on different timeframe,” he added.
“Logistics is a total of whole issues unless we solve the road transport problem we cannot solve the issue of lead time,” one of the participants said.
Roba Megerssa, CEO of Ethiopian Shipping and Logistics Services Enterprise (ESLSE), on his part said that there are challenges everywhere but the consequences and impacts shall differ. He said that the there are problems in both sides.
He criticized the Ethiopian side with lack of effectively communicate with stakeholders let alone Djibouti. “We have no common platform on the logistics service that is now improving,” he said.
He said there is so many challenges on the sector that will be solved on the team work.
Currently the railway line is currently connected with the port inside at DMP that has easy the port activity by easy loading cargos to the rail to transport with smaller period than truck transport to the central part of the country.
“For the last two months the railway has launched and so far seven trails have been operated, while it has managed three trains at the trial stage” Wahib told Capital.
“A single tingle train shall manage the volume that 70 trucks transport so the service will be daily after the discussion with the Ethio-Djibouti Railway operators and ESLSE,” He added.
Recently the Ethiopian stakeholders that included officials from Maritime Affairs Authority and the Ethio-Djibouti Railway visited the port and agreed to transport at least 2,000 tones of fertilizer per day via the rail.
On the other hand one of the major discussions point has been the challenges of the unseasonal rain in the region that is even unusual for Djibouti.
Roba said that the rain in Djibouti that seen in the last few weeks posing serious challenge for the logistics service provision.
The DMP CEO said that the meeting with the stakeholders is crucial and very pertinent questions raised the idea to form the committee is the right decision that both sides will work hard to make real.
The committee is expected to comprise relevant actors from the government private countries from both sides.
At the two days conference Warsama Guirreh, CEO of Djibouti Port Community System (DPCS), a subsidiary of Djibouti Ports and Free Zones Authority through Great Horn Investment Holding, has been also introduced the operation of the DPCS that established about a year and half to harmonize the logistics activity with latest platform that the world using now.
DPCS aims to coordinate the different processes linked to importing/exporting through the ports, airports, rail and corridor. Its product, the Port Community System aims to leverage technology to simplify, connect and streamline those processes.
Warsama told Capital the company is working on the implementation of integrated system of the Djibouti logistics and also Ethiopian logistics. “We have started with the implementation of all the vessel management for the shipping agency in Djibouti where everything is automates,” he said.
The agencies are able to send all the regulatory documents online to different authorities and DPCS noticed increase efficiency and that has reduced the time for the process to a single hour for berth response time that was 72 hours before.
For the freight forwarders also at this point in time able to book online the slots, containers slots, and to get port invoices online that has help them save four hours were they used to go to port premises to get the invoice with other process but now it shall be done online.
“Now they can do all online and they can print pre gate/ certificate from the system that allow the driver to get at the port,” he added.
“This will enable the Ethiopian logistics community to follow from Ethiopia the operation and process of their cargo transit in Djibouti so that is the importance of this conference,” Warsama explained.
So what is available at this point in time Ethiopian freight forwarder and transporters are able to follow the Ethiopian trucks coming in Djibouti. They will know: what time it has arrived in Djibouti, what time it has gone to the port, what time the booking has been done, what time it is has come out from the port and what cargo the truck is carrying. For instance what used to happen is that a lot of forwarders complained about being unable to know where the trucks were or even if they were in Djibouti or not. Now the new scheme will make it easier to follow up not only for the agents but for exporters or importers who shall also follow their cargo, Warsama said adding that the system has improved the logistics sector.
Port takes step to solve problems fast
Fed agencies to implement ten year plan
The Ministry of Trade and Industry is developing a ten year prosperity plan. All federal offices will implement the plan between 2020-2030.
According to the Ministry, the plan has three major goals. To create a digitalized trading system to make trade more efficient, increase the countries export revenue and improve growth rate and develop the manufacturing sector to 20pct of the GDP.
Eshete Asfaw, The State Minister of Ministry of Trade and Industry said, “Developing export oriented productions are planned as one of the key strategic sectors.” These include: textile and garment industry, leather and leather products industry, metal engineering industry, meat, dairy and honey processing industry, chemical and construction inputs industry, agriculture-processing industry, and pharmaceutical industries. At the end of the ten years the ministry has plans to increase export revenue up to USD 20 billion annually.
To achieve an annual average real GDP growth rate of 22 percent within a stable macroeconomic environment and thereby contribute towards the realization of Ethiopia’s vision of becoming a lower middle-income country by 2025focuses on ensuring rapid, sustainable, and broad-based growth by enhancing the productivity of the manufacturing sectors, improving the quality of production, and stimulating competition within the economy.
The ministry is moving to digitalize its system including online trade registration and licensing system, and preparing an “one office service”.
According to Eshate, implementation of the plan will start in 2020, after the end of the Ethiopia’s Growth and Transformation Plan II (GTP II).
Ethiopia’s Growth and Transformation Plan II (GTP II) implement in 2015/16 up to 2019/20 aims to achieve an annual average GDP11 percent growth rate: although the GDP remains less than the plan.
According to the World Bank, Ethiopia’s economy experienced strong, broad-based growth averaging 9.9% a year from 2007/08 to 2017/18, compared to a regional average of 5.4%. Ethiopia’s real gross domestic product (GDP) growth decelerated to 7.7% in 2017/18. Industry, compared to the previous year mainly construction, and services accounted for most of the growth. Agriculture and manufacturing made lower contribution to growth in 207/18. Private consumption and public investment explain demand-side growth, the latter assuming an increasingly important role.
The ministry has plans to get 3.77 billion USD in from export revenue, 2.65 billion USD from agricultural expenditure, 797.1million USD from the manufacturing sector, 265.8 million USD from mining and minerals in 2019/20.
Human Development Report says Ethiopia has work to do
Ethiopia is ranked 173 out of 189 in the 2019 version of the Human Development Index (HDI) placing it at the back of the pack when it comes to the HDI criteria. The Index looks at long-term progress in three human development dimensions: life expectancy, economic standard of living and access to education.
Launched on Tuesday, December 10, 2019 at Skylight Hotel in Addis Ababa under the theme: “beyond income, beyond averages, beyond today: inequalities in human development in the 21st century,” the 2019 Human Development Report (HDP), says, new inequalities are becoming more pronounced particularly around tertiary education, seismic effects of technology and the climate crisis making it harder for those already behind to catch up.
Human development: the Human Development Index (HDI), the Inequality-adjusted Human Development Index (IHDI), the Gender Development Index (GDI), the Gender Inequality Index (GII), and the Multidimensional Poverty Index (MPI). The final section covers five dashboards: quality of human development, life-course gender gap, women’s empowerment, environmental sustainability, and socioeconomic sustainability.
The report, which pioneers a more precise way to measure countries’ socioeconomic progress, notes that life expectancy, has increased by more than 11 years between the years 1990 and 2018 and stress on the need to emphasis on early childhood and lifelong investment including investing in young children’s learning, health, and nutrition to tackle inequality.
“Countries should go beyond income and averages among others to deal with inequalities, it is beyond income. Income and wealth are important measures of inequality; but you have to look at for example of health, of education, of dignity and respect for human rights,” says Turhan Saleh, UNDP Ethiopia Resident Representative.
“If inequalities in human development persist and grow the aspirations of the 2030 Agenda for Sustainable Development will remain unfulfilled,” the report further stressed.
Inequalities in human development are a defining bottleneck in achieving the 2030 Agenda for Sustainable Development. Inequalities in human development are not just about disparities in income and wealth.
The most recent survey data publicly available for Ethiopia’s MPI estimation refer to 2016. In Ethiopia, 83.5 percent of the population (87,643 thousand people) are multidimensionally poor while an additional 8.9 percent are classified as vulnerable to multidimensional poverty (9,322 thousand people). The breadth of deprivation (intensity) in Ethiopia, which is the average deprivation score experienced by people in multidimensional poverty, is 58.5 percent
Policy choices determine inequality outcomes – as they do the evolution and impact of climate change or the direction of technology, both of which will shape inequalities over the next few decades. Inequalities in human development hurt societies and weaken social cohesion and people’s trust in government, institutions and each other. They hurt economies, wastefully preventing people from reaching their full potential at work and in life.
Doraleh Port starts dry bulk service
Doraleh Multipurpose Port (DMP) and SDTV Bulk Terminal will begin serving dry bulk importers.
The newly built and ultra-modern Doraleh Multipurpose Port and SDTV Dry Bulk Terminal, an experienced private concessionaire with a concession agreement of 30 years, with 18 years remaining, are offering their expertise and infrastructure to uphold Djibouti Ports’ competitiveness towards the growing competitiveness of regional ports.
Both terminals (DMP and SDTV) are handling dry bulk cargos and recording increasing volumes at an unparalleled performance level in the region. This upward trend is meant to further increase in the upcoming years.
A total volume of 3, 371, 196.38 tons of dry bulk cargo, has been handled by the two ports since January to date. This represents an increase of 7% compared to the same period last year and a 44% increase compared to 2017. This steady growth will continue with an estimated total volume expected to reach 3.7 million tons at the end of this year.
Tadjourah Port, another new dedicated port with a depth of -14.5 meters, will offer a third viable option for dry bulk importers and exporters. With the connecting road completed, this new facility is well positioned to serve hinterland and could accommodate vessel of up to 80,000 DWT.
To achieve higher performances and seamless movement of cargo transiting to the hinterland, these ports will target excellence through the advantage of a positive, fair and free competition, in order to serve the country’s vision to consolidate its geostrategic location.
