Wednesday, November 29, 2023
BusinessEthiopia launches railway project with Eritrea

Ethiopia launches railway project with Eritrea

Italy considers involvement

While addressing the Ethio-Italian Business Forum on Thursday, Ahmed Shide, Minister of Finance, told Italian officials and business delegates that Ethiopia is about to pursue a railway project that connects Ethiopia with port cities of Eritrea.

According to the minister, a feasibility study has been launched and the World Bank Group is behind the project. Hence, when the project comes to life, the ports of Assab and Massawa will have direct railway links with North, East and central parts of Ethiopia. So far, Ethiopia has rail and road or power connectivity with Djibouti, Kenya, Sudan and South Sudan. When The Reporter asked the minister how much money the railway project will require? He said it will be determined by the outcomes of the feasibility study.

Emanuela Del Re, Deputy Minister of Foreign Affairs and International Cooperation of Italy, told The Reporter that her government will consider involving in the Ethio- Eritrean railway connection. During the sideline of the business forum, The Deputy Minister met with Osman Saleh, Eritrea’s Minister of Foreign Affairs and Yemane Gebreab, Eritrea’s Presidential Advisor and Head of Political Affairs. The officials were accompanied by Gedu Andargachew, Ethiopia’s Minister of Foreign Affairs. The ministers had a brief chat at the Hayat Regency Hotel.

When asked if the meeting between the three was planned? Emanuela said that “It was a coincidence.” She also said that her government has recalibrated the need to work in partnership with Ethiopia and to support its development. It is to be recalled that a few weeks ago, Italy pledged to provide assistance to the preservation and protection of the Aksum Monolithic Obelisks.

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With that connection, the Italian deputy minister of foreign affairs has visited the monuments in Aksum to learn about what will be required to maintain one of the ancient civilization hallmarks of Ethiopia. Sadly, they are under fragile conditions at the moment. One of the monuments of Aksum Obelisks was taken to Italy during the five year occupation of Ethiopia from 1936 to 1941. It was returned from Rome to its original place in Aksum in 2005 and re-erected in 2008.

Ahmed told The Reporter that Italy has provided EUR 150 million to finance development projects. 

During the business forum which saw the attendances of high level officials of both countries, with 40 major companies of Italy present, Ahmed, who is also in charge of the privatization and economic reform process, has briefed the delegates about the ongoing reform packages in Ethiopia.

 He recalled the partial privatization process that involves both Ethiopian Airlines Group and Ethiopia’s logistics sector, where state owned enterprises had enjoyed monopoly power for ages. He further mentioned the process of privatizing Ethiopia Telecom, sugar plants and other significant assets. Financial and asset valuations are ensuing on these subsectors of the economy; Ahmed mentioned adding that all has got to do with the serious interests of the government to attract private investments into Ethiopia.

The business forum was a success and to the Italian team, according to Carlo Ferro, President of Italian Trade Agency, the mission was concluded with satisfaction.

However, concerns of hard currency shortages and taxations were among the issues Italian firms have raised to Ahmed. For instance, the Automotive Manufacturing Co. of Ethiopia (AMCE) – a joint venture between the Fabrica Italiana Automobili Torin (FIAT) and the government of Ethiopia (Ministry of Trade and Industry) with a 70/30 percentage share ownership – has raised the critical shortages of foreign currency shortages impacting its long established assembly plant in Ethiopia.

Ahmed has vowed to provide solutions and made an appointment with the executives of AMCE.

According to Ferro, Italian businesses have invested EUR 590 million in Ethiopia and want to invest more and more as openings and opportunities are in the making in today’s Ethiopia. Recently, the likes of Calzedonia Group, a renowned Italian apparel maker have set foot in Ethiopia.

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