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Ethiopian shipping lines aiming to be No.1 in Africa

Ethiopian shipping lines aiming to be No.1 in Africa
  • PublishedOctober 4, 2011

Contributing to the economy, Ethiopian Shipping Lines (ESLSC) provides a regular liner service mainly moving general, bulk and containerised cargo. Since its establishment in 1966, the company has lifted 27.2m tonnes of cargo. In 2011, this was 37.3% from dry cargo and 56.3% from general cargoes.

The company has served the country for the past 47 years, transporting cargo safely throughout instability in neighbouring countries, and is run by highly qualified national top management and shipping experts, both ashore and on board vessels. It is the leading indigenous shipping company within the COMESA countries. The government of Ethiopia encouraged the company to develop in this important maritime sector with policies that create competitive advantage.

In its export and cross-trade services, Ethiopian Shipping Lines has generated a significant amount of revenues in hard currency and enhanced Ethiopia’s foreign reserves. The company encourages both exporters and importers by offering stable and long-lasting freight rates.

Ethiopian Shipping Lines loads various types of cargo including dangerous, outsized and special cargos, which are vital for the country’s economic development and security. In its export and cross-trade services, ESLSC has generated a significant amount of revenue collected in hard currency and thereby enhanced foreign reserves. It creates favourable conditions for both exporters and importers by offering table and long-lasting freight rates.

Investment and financial hub

Ethiopian Shipping Lines is pursuing sustainable and prolonged strategies to enhance its capacity and diversification. These are investments in new vessels acquisition, container terminal operation and diversification in multimodal transport services (door-to-door shipping and logistic services).

To enhance its existing fleet capacity, the company has signed a $293.5m contract with China Shipbuilding Yards for the construction of nine vessels (two product tankers and seven multipurpose dry cargo ships). These ships will raise the company’s dry cargo loading capacity by 196,000 DWT and 11,975 TEU, enhancing the dry cargo loading capacity of the company to 337,742 DWT. The two product tankers, having 83,000 DWT, will enable the company to extensively build its competitive advantage and outreach the oil and gas shipment market.

Due to the containerisation and globalisation of production, a sea transport service needs logistic services to enhance efficiency and maintain sustainability based on multimodal transport operations. Ethiopian Shipping Lines is constructing a new inland container terminal on a 20.9 hectare site outside Addis Ababa, with an investment of $15m to develop capacity and attract business.

Training and development

The company has two training initiatives. The Babugaya Maritime Training Institute offers short-term training programmes to bring ratings up to the international standard required by IMO. The Ethiopian Maritime Training Institute has been established through strategic partnerships in accordance with the global maritime practices and standards to train and educate over 1,000 marine engineering officers annually, making Ethiopia a major exporter of high-quality marine professionals to the global maritime labour market. The government of Ethiopia gives full-scale support.

Government support

The government of Ethiopia encouraged the company to develop itself in this important maritime sector. It has made commendable efforts to improve the capacity of the company, focusing on the expansion of the fleet. It strongly supports the EMTI mission, providing significant incentives and policies that create competitive advantage.

Considering the strategic significance of the maritime sector, it is imperative to develop the capability of an indigenous shipping company to enable Ethiopian Shipping Lines to maintain and enhance its competitiveness in the face of changing market conditions. This requires government support for reinforcement of a competitive foundation through continuous capacity enhancement and new development programmes.

Vision for the future

The company has a vision in line with the country’s vision.

In the next five years, the company will extend the entire transport and logistics chain, which could make it the largest liner trader in Africa in the next five years. It will extensively build its competitive advantage and outreach in the oil and gas shipment to serve the international market through strategic partnerships. Existing constraints in finance and limited access to foreign credit suppliers is a challenge. However, the company’s performance report shows a positive return that will attract credit suppliers to work with the company: its strict follow-up and implementation of international rules and regulations has enabled Ethiopia to be among the very few IMO white-listed countries.

Written By
New African

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