Chinese-built SGR set to streamline Ethiopia's export, boost profitability

ADDIS ABABA -- The Ethiopian government said the Chinese-built Addis Ababa-Djibouti Standard Gauge Railways is set to streamline Ethiopian export and boost profitability.

This came after a delegation led by Abdi Zenebe, CEO of Ethiopia-Djibouti Standard Gauge Railways S.C. (EDR), visited Djibouti and held discussion with officials at the Ethiopian Embassy to discuss ways to streamline Ethiopian export products by reducing logistical bottlenecks and increasing profitability, the Ethiopian Ministry of Foreign Affairs disclosed on Monday evening.

"By utilizing railway wagons and setting up affordable prices to attract more clienteles, the railway company is focusing on schemes of addressing logistical issues caused by the conventional ways of transporting Ethiopian export products to Djibouti and beyond," the statement read.

The 752-km transnational railway company envisaged reducing the overall supply chain constraints by developing a system of transportation that fits the global standard for products such as fruits and vegetables, cold and chilled meat and live animals, which will eventually benefit millions of growers and pastoralists, the statement quoted Zenebe as saying.

The Addis Ababa-Djibouti electrified railway, also known as the Ethiopia-Djibouti railway, was contracted by China Rail Engineering Corporation (CREC) and China Civil Engineering Construction Corporation (CCECC).

The railway company would be able to expedite the transport of live-animals to Djibouti's Doralleh multipurpose port to be finally destined to the Middle East and the Gulf, the statement said.

During the discussions, an agreement has been reached to hold the first Ethiopia-Djibouti Railway Promotion Fair in October this year in order to best connect investors, exporters, and importers, maximize revenues of EDR and boost trade between the two countries, according to the ministry.

The railway presently provides both passenger and freight services between Ethiopia and Djibouti.

According to figures from the joint venture, the railway's monthly transport revenue exceeded 9 million and 10 million U.S. dollars in October and November respectively in 2021, the best result since 2018. The transport revenue in 2021 is 37.4 percent higher than in 2020.

The railway has also created numerous job opportunities for locals, with more than 4,000 locals employed so far, which accounts for over 90 percent of the total staff.