Saturday, July 13, 2024

Boost in local container packing saves $2.5 million in export costs despite shortages

By our staff reporter


Despite a shortage of containers slowing down the process, Ethiopia manages to fill more than half of its containerized export cargo with locally staffed containers.

According to the Ministry of Transport and Logistics (MoTL), over 22,400 TEU export cargos packed locally were sent out in the first nine months of the 2023/24 fiscal year.

Alemu Sime, the Minister of MoTL, reports that localized export cargoes accounted for 58% of all outbound shipments during this time period.

In his most recent report to the parliament, he claimed that the increase in domestically packed cargo had helped save over USD 2.5 million in the previous nine months.

As part of an effort to expedite logistical activities with affordable initiatives, the government has begun to increase the amount of cargo staffed locally rather than at the port site.

Based on this, MoTL anticipated that 83.9 percent of all export cargoes would be filled locally during the specified nine months.

According to Alemu, the actual share reached 58 percent at the end of the nine months.

The Minister informed the legislature a couple of weeks ago that it was 69% of the goal.

He stated that the main reason for not reaching the goal was a shortage of empty containers.

Previously, the majority of Ethiopian export cargoes, which are mostly agricultural commodities, were packed in Djibouti, resulting in foreign currency expenses due to higher charges compared to local expenses.

Currently, Ethiopia has started using alternative ports including the Port of Tadjoura in the northwest of the Gulf of Tadjoura in Djibouti, Berbera in Somaliland, and Kenya’s Mombasa Port, in addition to the port in Djibouti City and its surrounding areas.

“We have imported 312,714 metric tons of coal via Tadjoura in the stated period, which allowed us to save over 53 million birr,” remarked Alemu.

The Minister declared, “We are also using Lamu Port in Kenya in this budget year.”

“The cross-border railway system is playing a significant role in importing cargo, and we will add two more locomotives in the near future to accelerate import cargos through trains,” he added, referring to the limitations on track availability for transporting cargo from Djibouti.

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