East Africa: Electric Railway to End Djibouti Port Congestion

Djibouti's Société de Gestion du Terminal a conteneur de Doraleh (SGTD) chief executive Abdillahi Adaweh Sigad on December 6, 2018.

The Ethiopia-Djibouti electric railway will start transporting containerised goods from next January, official said.

Mr Abdillahi Adaweh Sigad, the CEO of Société de Gestion du Terminal a conteneur de Doraleh (SGTD), said the line will, in three weeks, start transporting 200 containers daily.

"We will start with two trains, which will have a capacity of transporting 100 containers each every day," Mr Sigad told visiting journalists from Ethiopia.

SGTD took over the administration of the port from DP World.

DP World previously managed the Doraleh Container Terminal with a minority share, but the Dubai firm and the government of Djibouti disagreed, and the latter unexpectedly cancelled the contract.

DP World consequently took the Djibouti government to the London Court of International Arbitration, which reportedly ruled last August that the former's container terminal contract was valid and binding.

The government of Djibouti seized the Doraleh Container Terminal from DP World early this year over their dispute dating back to at least 2012.

Djibouti Ports and Free Zone Authority (DPFZA) said in March that it was willing to buy out DP World's 33 percent stake in the container terminal to end the row with one of the world's largest port operators. However, DP World denied that such an offer had been made.

Mr Sigad said the railway would soon be linked to the Duraleh Container Terminal, which was now administered by SGTD.

Mismanagement

"The train is operational since June this year. The volume is increasing. Now the station is finalised.

"From 1st of January, we will be able to manage up to four or five trains and by September we will be handling eight to ten trains."

For many years, failure by importers to collect their goods on time, a shortage of transportation trucks as well as mismanagement of containers destined for Ethiopia, congested the Djibouti port for several months.

That cost Ethiopia huge levies, forcing it to introduce dry ports within the country such as Modjo Dry Port.

Currently, the specialised containers only handling terminal has eight key cranes to discharge containers from ships.

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