The Ethio-Djibouti Railway Standard Gauge Share Company (EDR) has officially entered the multimodal transport sector by obtaining a Multimodal Transport Operation (MTO) license. This development positions EDR as the fifth participant in an industry previously dominated by the state-run Ethiopian Shipping and Logistics (ESL).
The Ethiopian Maritime Authority (EMA) granted the license to EDR following an extensive evaluation process, which assessed the company’s infrastructure, operational readiness, workforce, and technological capabilities. EDR’s entry aligns with the Ethiopian government’s plan to diversify the MTO sector by encouraging competition and expansion. Prior to EDR’s licensing, EMA had issued Non-Vessel Operating Common Carrier (NVOCC) licenses to several local companies, including Panafric Global Plc, Tikur Abay Transport Plc, and Cosmos MTO.
Fraol Tafa, Deputy Director General at EMA, highlighted that the agency’s goal of broadening the multimodal transport sector had been realized with EDR’s successful application. He emphasized the significance of supporting new entrants to the industry to foster growth and competition.
EDR, a joint venture between the Ethiopian and Djibouti governments, began its commercial operations in 2018, significantly reducing freight transit times from over three days to under 20 hours. The company manages the transport of containerized, bulk, and Roll-on/Roll-off (RoRo) cargo, along with passenger services.
Mintesinot Yohannes, Global Logistics Director at EDR, expressed her excitement about securing the MTO license, stating that the company is now preparing to begin operations. With Djibouti holding a 25% stake in the company, EDR’s entry into the multimodal sector is expected to improve both efficiency and competitiveness in the regional logistics landscape.
As an NVOCC operator, EDR will work alongside ESL, which, despite owning its own fleet, also operates as an NVOCC for multimodal transport in Djibouti. The company’s entry into the market, long awaited by industry observers, marks a significant shift in Ethiopia’s logistics industry, promoting a more competitive market environment.
In another milestone, Ethiopian engineers have successfully restored and repaired locomotives and wagons that had been out of service for several years. EDR CEO Takele Uma praised the engineers’ efforts, noting that they had restored over 16 locomotives and 200 wagons, increasing the company’s fleet capacity. This achievement marks the first instance of Ethiopian engineers independently handling the maintenance of EDR’s fleet, a significant step towards self-reliance in the country’s railway sector.
The restoration of these locomotives and wagons signals a new era of innovation and capacity building within Ethiopia’s railway system, further enhancing EDR’s operational capabilities. Takele Uma emphasized the importance of this achievement in shaping the future of Ethiopia’s logistics sector.