Monday, April 15, 2024
NewsLong neglect takes toll on Ethiopia's main trade artery

Long neglect takes toll on Ethiopia’s main trade artery

Damaged roads, safety issues plague trade corridor

Disrepair on the Addis Ababa-Djibouti trade corridor, which handles 95 percent of Ethiopia’s trade, is costing drivers hundreds of thousands of birr in repairs and endangering lives, according to a new study.

Despite contributing significantly to both countries’ economies, the longest Ethiopia-Djibouti trade corridor faces ongoing issues that continue to irate businesses.

The Ethiopian Logistics Sectoral Association survey released Thursday chronicles chassis fractured, suspensions shattered, vehicle chassis, suspensions, shocks, tires, dashboards and truck bodies severely damaged from road defects.

Parking shortages and road safety concerns also plague drivers. Most said dealing with infrastructure challenges and security risks is common.

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Breakdowns cost truckers 200,000-600,000 birr to relocate vehicles and goods, drivers said, due to expensive cost of local technicians.

Poor road conditions caused back pain, kidney failure and breathing issues, according to the study. Drivers cited horrific murders, illegal inspections, harassment by border authorities and residents, and needless stops as major problems.

Over 85 percent called the Galafi to Dikil stretch in horrible shape. 15 percent said Galafi to Dire Dawa Turn-off is rapidly deteriorating.

Vehicle maintenance costs have surged from poor roads, raising logistics costs.

Officials of the Association expressed concerns that drivers may soon be unable to work, disrupting supply chains and deterring business, given the severe safety issues and hazardous conditions.

Businessman Tsedeke Yihune (Eng.) cited huge logistics costs importing through Djibouti. He says the claims that shipping from China to Djibouti was one-third of the total cost, with the rest from Djibouti to Addis Ababa, was erroneous.

Dereje Largesse of the Transport Employers Federation said poor roads significantly increased maintaining 12,000+ trucks. He decried the safety risks and neglect, urging officials to address bureaucracy hindering business.

“It is particularly concerning to see the driver’s safety put at risk and road safety neglected,” he said, calling on Ethiopian and Djiboutian officials to streamline unnecessary bureaucracy that hinders the business climate.

The Association urged the government to prioritize the trade corridors and safety, noting they are points of entry for most imports and exports. It requested adequate funding to maintain excellent road conditions.

Despite reforms under Prime Minister Abiy Ahmed (PhD), Ethiopia continues to face poor trade logistics and difficulties improving its business environment. As a result, the country’s global trade remains low due to supply and demand constraints.

A new USD 730 million International Development Association (IDA) grant aims to significantly upgrade the Addis Ababa- Djibouti corridor as part of the Horn of Africa Initiative’s Regional Economic Corridor Project.

The project will improve the route between Ethiopia and Djibouti, particularly the section between Mieso and Dire Dawa, to shorten travel times, boost safety, cut costs and reduce pollution.

As Ethiopia seeks to diversify its ports, the corridor currently handles around 95 percent of the country’s trade.

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Video from Enat Bank Youtube Channel.

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