In a major step towards deregulating Ethiopia's logistics sector, the Ministry of Transport has issued licenses to three private companies allowing them to operate as multimodal transport operators (MTOs).
Speaking at a ceremony today, Transport Minister Dr. Alemu Sime said Panafric Ride Limited Liability Company, Tikur Abay Transport, and Cosmos Multi Modal Share Company have been cleared to provide integrated freight logistics services across road, rail and air cargo.
To receive the licenses, the companies had to meet several requirements outlined in directives issued in 2014. This includes having a minimum paid-up capital of 350 million birr in cash and assets. They also needed to own or lease at least 5 hectares of secured land for transport terminals and warehouses.
Furthermore, the selected firms had to demonstrate adequate logistics infrastructure like developed terminals spanning 3 hectares, a 3,000 square meter warehouse, and qualified personnel numbers.
This marks the first time private firms have fulfilled all licensing criteria to ship goods using multiple modes of transportation under a single document in Ethiopia. For over 20 years, the Ethiopian Shipping Lines and Logistics Services Enterprises (ESLSE) held the monopoly as the sole licensed MTO.
"By introducing qualified players who have met our standards, we aim to improve logistics competitiveness," said Transport Minister Dr. Alemu Sime.
Industry insiders say breaking ESLSE's long hold could encourage service standards and rates.
