Addis Abeba — Takele Uma, the newly appointed CEO of the Ethiopia-Djibouti Railway S.C., has pledged to transform the company into a profitable entity within three years.
He made this announcement on 28 August, 2024, during a consultation with the railway's employees in Dire Dawa city, where he discussed the ongoing changes within the company and the new organizational structure.
The meeting was also attended by Kedir Juhar, mayor of Dire Dawa city.
Addressing the employees, Takele highlighted that despite the company's six years of operation, it has accrued debt rather than delivering the expected contributions to the nation.
"A three-year strategic plan and a new organizational framework have been developed to drive the necessary changes and achieve profitability," he stated.
The CEO expressed his confidence that by implementing effective operational and organizational approaches, along with strategic planning, the railway can achieve profitability within the specified timeframe.
Over the past week, Takele has been engaged in extensive consultation meetings with various employees, including those stationed at the Ethio-Djibouti Railway headquarters as well as at the Meiso and Adama railway stations.
During these discussions, he called on all employees to collaborate in transforming the company into a vital contributor to the national economy by enhancing export and import trade.
Takele also highlighted the immediate need to improve the company's financial performance, create a more conducive work environment, and transform the railway into a thriving institution that benefits the country's economy.
Takele, who previously served as the Minister of Mines and Deputy Mayor of Addis Abeba, was appointed by Prime Minister Abiy Ahmed to lead the Ethiopia-Djibouti Railway in mid-July 2024.
He succeeded Abdi Zenebe, who recently assumed the role of Deputy Executive Director at the Institute of Foreign Affairs.
Two weeks ago, Takele met with Chen Hai, the Ambassador of the People's Republic of China to Ethiopia, to discuss the pressing operational and maintenance challenges facing the company.
During the meeting, he expressed concern over the current state of the railway and disclosed that only 15 of the 32 freight locomotives are operational.
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
"The shortfall has drastically reduced the railway's annual carrying capacity, which should be 6.3 million tons per year," the CEO noted. "Instead, we are currently operating at only 2.4 million tons per year," representing merely 38% of its full potential."
Spanning over 750 kilometers and connecting Addis Abeba to the port of Djibouti, the railway project was a joint venture between Ethiopia, Djibouti, and China.
With a total investment of $4 billion, it was primarily financed by China Exim Bank, which covered 70% of the cost in the form of credit, while the Ethiopian and Djiboutian governments financed the remaining 30%.
The construction of the railway, which began in 2011, was undertaken by China Railway Group Limited and China Civil Engineering Construction Corporation, both state-owned enterprises operating under the Chinese government.
China Railway Construction Corporation (CRCC) managed the railway's operations from the commencement of its operation in 2018 until May 2024, when management responsibilities were transferred to the Ethiopian and Djiboutian governments.
Previously, railway officials have consistently raised concerns about the detrimental impact of theft and vandalism on the Ethio-Djibouti railway, which they say has resulted in substantial revenue losses.
Two years ago, the company reported a loss of 114 million birr in the first quarter of the 2020/2021 fiscal year, primarily attributed to these criminal activities.
