Ethiopia uses digital technology to address the ongoing shortage of shipping containers

The government has unveiled an innovative strategy, harnessing the power of digital technologies, to meticulously track and manage the nation’s available containers over the next three months. This move comes as essential export commodities are left in limbo due to a persistent lack of containers and other related issues.

This information was revealed at a meeting on April 29th with shipping agents, coffee exporters, and other stakeholders organized by the Ethiopian Maritime Authority to discuss the ongoing containerization issue.

During the conversation, Ethiopia’s State Minister for Transport and Logistics, Dengue Boru, clarified that although coffee is Ethiopia’s primary source of foreign exchange, the nation needs to receive the expected income from this commodity. Dengue stressed that containerization operations must prioritize big export products like coffee to increase export earnings.

During a recent meeting, the Ethiopian Maritime Authority’s Director General, Abdulber Shemsu, described current attempts to address the containerization issue at the policy level. He also said that the creation of digital software to oversee the available containers will be finished in the upcoming three months.

The general manager of the Ethiopian Coffee Exporters Association, Gizat Worku, recognizes that container shortages have been a persistent issue since the COVID-19 outbreak began. The pandemic caused manufacturers to close their plants, which resulted in a decrease in production, which is what caused the worldwide shortage of shipping containers. Presently, China produces more than 95% of the world’s containers, with three state-owned companies controlling a sizable portion of the industry.

Due to this shortage, the Ethiopian Shipping and Logistics Services Enterprise (ESLSE) purchased more than 3,000 more shipping containers in 2021.

Major shipping lines are steering clear of the region, which highlights the increasing challenges Ethiopia faces in getting its products—most especially coffee—to international markets. According to reports, approximately 30,000 quintals of coffee are trapped at ports in Djibouti as a result of the recent attacks in the Red Sea region.

Gizat also told Addis Standard that Yemen’s export performance has suffered as a result of the Houthi rebel group’s attacks on shipping enterprises. There is a lack of shipping choices since shipping companies associated with Israel and its allies have stopped using the Red Sea route.

Furthermore, Gizat pointed out that the longer distance and higher costs for each container moved are associated with the alternate route through South Africa.

In response, ESLSE decided to use its vessels to provide freight services. As a backup plan, the authorities also consider purchasing additional boats.

Two weeks ago, the Enterprise representatives, notably CEO Beriso Amelo, visited China to discuss the possible acquisition of new ships with shipbuilding firms.