30 December 2012

Ethiopia: Two Dry Ports Congested,Enterprise Gets a Third

Alarmed by the increased congestion of the country's dry ports, the management of the Ethiopian Shipping & Logistic Services Enterprise (ESLSE) requested traders to collect their containers on time.

Ahmed Tusa, CEO of the recently amalgamated ESLSE, along with Alemu Ambaye, chief engineer of theEnterprise, said that such congestion has now become the problem for the implementation of the Multi-modal Transport System (MTS).

"The problem now is not collecting containers from theDjiboutiPort: it is running smooth now," Ahmed said during his first press briefing about the MTS on Friday, December 28, 2012. "The problem is that the traders are not collecting their containers from the dry ports at the appropriate time."

There are around 7,800 containers at theModjoDryPortand in the compounds of the Comet Transport S.C. that theEnterpriseis currently using as a dry port terminal because the former is congested. TheModjoDryPorthas enough space for only 6,300 containers at a time.

TheDjiboutiPortthat saw as high as 22,000 containers in May 2012, on the other hand, had only 1,200 containers, the remaining having been transported toEthiopiathrough the MTS until Friday December 28, 2011.

TheEnterprisesays that this was achieved after it started carrying 300 containers a day. Most importers Fortune talked to, however, claim that theEnterprise's efficiency had nothing to do with it. The congestion is elevated, they say, because theEnterpriseis giving waivers to the importers who want to transport their goods using the uni-modal transport system.

Ahmed also affirmed that theEnterprisewould continue respecting the importer's choice of ways of transportation for unspecified period of time.

Since the two dry ports are congested, the Enterprise has constructed a terminal that has a capacity of containing 9,300 containers at a time inside the compound of Bekelcha Transport S.C. located in Adama, 99Km east of Addis Abeba. Starting from Monday, January 1, 2013, containers transported fromDjiboutiwill be handled at Bekelcha.

The congestion of the dry ports, however, is not the only headache for theEnterprisebut also the Ethiopian Revenues & Customs Authority (ERCA), which generates half of its revenue from customs duty levied on imported goods.

Melaku Fenta, director general of the Authority, and Gebrewahid Gebregiorgis, deputy director general, discussed with the major importers to learn why they are not collecting their containers on time, last Thursday, December 27, 2012, according to sources who attended the closed meeting.

The meeting was conducted at the headquarters of the Authority, located offHailegebreselassie Street, where major importers and forwarders were in attendance.

The traders claim that they did not have the finances to clear their goods, and pay all the necessary taxes, according to sources who attended the meeting.

The traders also requested the Authority to clear their goods on credit.

The officials responded that the Authority would notify them on the decision after discussing the matter with the relevant authorities, including banks and the ESLSE.

The ERCA collected 22.2 billion Br in the first quarter of 2012/13 fiscal year, of which customs only contributed 10.1 billionBr.The revenue from customs contributed 80 million Br less than the target for the quarter.

Some of the importers, on the other hand, alleged that it is because containers are not managed systematically that they are not able to collect their containers.

They claim that containers that should be brought to Modjo are taken by mistake to theSemeraDryPort, taking weeks to get them back to Modjo.

They also alleged that the ESLSE did not know the status of containers clearly that a container that already arrives at the dry ports is said to be inDjibouti.

Ahmed admitted the existence of such problems, but promised that they would no longer occur.

Currently, theEnterpriseis calling the importers individually, informing them on the status of their containers. It is also negotiating with ethio-telecom to have its own SMS system to inform the status of goods for its customers.

In finding a permanent solution, the Ethiopian Maritime Affairs Authority (EMAA) prepared a draft directive that penalises importers who do not take their goods within 45 days after arrival at the ports. The draft has already been sent to Ministry of Transport (MoT) for approval.

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