The Ethio Djibouti Railway Standard Gauge Share Company (EDR) and the Djiboutian port operator Doraleh Container Terminal Management Company (SGTD) are in talks to invest in railway facilities. Additionally, EDR is planning to start working with a Chinese enterprise in Nagad and Dire Dawa.
Abdi Zenebe, the CEO of the joint venture between the governments of Ethiopia and Djibouti, stated that the railway firm is expanding its business and diversifying its operations by forming new partnerships with interested parties in the logistics industry.
According to him, negotiations are underway between the railway firm that links Djibouti with central Ethiopia and SGTD, a modern container port operator in Djibouti, for the port operator to participate in parts of EDR’s operations.
Regarding EDR’s operations, the Ethiopian side expects to support the flow of goods such as mining and agricultural products, and the ports in Djibouti are interested in increasing port efficiency, according to Abdi.
As they put it, “we are jointly working together and in the near future SGTD will have an investment in the logistics activity that we carry.”
“It is a mirror image; we have partnered with SGTD to improve the activity and involve the port operator in certain areas, so the efficiency at the railway has a direct impact on ports,” he told Capital, adding, “They have specific experience handling port machinery.”
Experts in every field, including cranes, are available at SGTD; for example, they are now inspecting Endode’s EDR equipment.
“They will assist us in increasing our productivity at Dire Dawa, Sebeta, and other stations. They are interested in investing in the logistics industry, therefore, we are searching for opportunities to work together on a joint venture,” Abdi continued.
He said that talks are now taking place between the two sides to determine which sectors the port operator will invest in as a business partner at EDR.
The CEO remembered that end-to-end service as a last and first mile is soon to be introduced to increase the railway company’s income and quality of service.
The CEO claims that the firm will have vehicles to carry out the plan, but until then, it will launch a leasing program.
“We are working on it because we have the ability and knowledge to operate as freight forwarders, which is unavoidable. In the upcoming years, we will diversify into several industries and will have around seven satellite firms,” he said.
A portion of the business will be conducted under the public-private partnership (PPP) model, per the proposal. He declared, “At this time, we have already begun the PPP arrangement with the Chinese company, CCECC.” To improve the shipping of fertilizer and oil, the Chinese company and EDR developed a bulk cargo containerization (BCC) hub at the Nagad Railway Station in Djibouti.
In the same vein, the company will invest in Dire Dawa to upgrade the coal and cement ship that will soon be active.
About two months ago, Sebeta Railway Station in Ethiopia opened for business, and more recently, Hol Hol Railway Station in the Djiboutian part, according to the CEO.
The business has already made it possible to deliver strategically important goods like fertilizer. Moving billets is now a component of the growth of the modern transportation infrastructure’s freight activities.
According to the CEO, EDR will begin shipping commodities from the dry port in Dire Dawa and coal from Sebeta. “At the same time, clinker will be transported as part of business diversification,” the CEO stated.
