Friday, April 19, 2024
BusinessEthiopian forges partnership with DHL to provide logistics services

Ethiopian forges partnership with DHL to provide logistics services

Ethiopian Airlines Cargo and Logistics has partnered with DHL— a leading global logistics and forwarding company— to deliver logistics services in Ethiopia.

Sources told The Reporter that Ethiopian Cargo and Logistics Services has established a joint venture logistics service company with DHL that would serve the local industry. Sources disclosed that the joint venture company will have offices in Addis Ababa and regional towns. “The company would focus on serving manufactures in the newly established industrial parks and other major export centers.”

Executives of Ethiopian Airlines and DHL were supposed to announce the new partnership on Monday, with DHL staff and management meeting at the UNECA. However, the event was postponed due to some unfinished technical matters. “The new partnership with DHL requires the government’s approval,” sources said.

Belinda Tan, vice president of corporate communications with DHL declined to comment on the matter. “Right now, we cannot provide you information. We will communicate with you in due course,” she said.                       

The Ethiopian government is developing industrial parks in various parts of the country. Three industrial parks have been built in Hawassa, Mekelle and Kombolcha towns and seven more are under development. Many believe that the development of the industrial parks will transform the economy significantly.    

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Ethiopian Airlines Group CEO, Tewolde Gebremariam, told The Reporter that he firmly believes the development of the industrial parks is going to be a game changer in the Ethiopian economy in terms of industrialization. However, Tewolde said, industrialization without equivalent global standards and logistics service will be a failure. “We learnt this from China, Europe and the US. In China most of the development is around the coastal areas.”

“If we see the Hawassa, Mekelle and Kombolacha industrial parks (Dire Dawa and Adama under construction), they produce significant amounts of products for export. The manufacturers should get a global standard logistics services. If it is a high value and time sensitive material, they may use air transport. If it is low value and long-time deliver service, then they can use sea transport. We believe that the logistics sector is lacking behind. It is under developed. I know there are a number of initiatives to develop the sector. And we also want to contribute our share. That is why we are going to enter the logistics service in Ethiopia,” Tewolde added.

 One of the seven profit generating units of Ethiopian Airlines Group— Ethiopian Cargo and Logistics Services is scaling up its business operation by making huge investments on its infrastructure and fleet.

With eight dedicated cargo aircraft, six B777-200F and two B757-200F with a daily up lift capacity of 8,672 tons, Ethiopian Cargo and Logistics Services is the largest cargo operator in Africa.  

At the Paris Airshow 2017, Ethiopian placed firm orders for two B777F valued at USD 615.4 million. In June 2017, Ethiopian inaugurated a state of the art cargo terminal built at its main hub in Addis Ababa at a cost of USD 150 million. Ethiopian has embarked on the construction of the second phase of the new cargo terminal which has the capacity to handle 600,000 tons of cargo per annum. Coupled with the previous terminal; Ethiopian Cargo now has the capacity to handle close to one million tons of cargo.

Sources told The Reporter that Ethiopian Cargo and Logistics Services is dealing with global electronic giants like General Electric (GE), Samsung and Techno Mobile to set up their storage and distribution centers in Addis Ababa where Ethiopian cargo can provide to them with efficient and reliable transport services throughout Africa.

Ethiopian Cargo is now transporting 343,000 tons of cargo every year generating 10 billion birr revenue. According to Ethiopian 15-year growth road map dubbed Vision 2025, Ethiopian Cargo will have 19 dedicated freighter aircraft (11 B777, four B767-300 and four B737-800) which can transport 820,000 tons of cargo generating USD two billion of revenue flying to 57 destinations. It now serves 39 international cargo destinations.

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