Ethiopia’s Freight Transporters Debut Platform Bidding to Digitize Logistics Network

A powerful lobby group of Ethiopian transporters has embarked on a project to digitize freight operations and minimize the role of middlemen. The Ethiopian Transport Employers Federation (ETEF) has linked up with United Africa Logistics to kick off the platform. Importers can book freight trucks, track them in real-time, and communicate directly through the platform poised to launch in a few weeks.

Berhane Zeru, President of ETEF, expects the platform to introduce efficiency and integration to a process that has historically been dominated by unscrupulous middlemen. He says members of their association own nearly 90% of trucks operating in the country, which should grant users a multitude of options.

“Transparency will be increased while unnecessary costs are minimized,” Berhane told Shega.

Currently, importers in Ethiopia rely on existing relationships and personal connections to hire transporters to move their goods from Djibouti’s ports into the country. However, this process has long been plagued by brokers who artificially drive up service costs.

The new platform addresses this issue by directly connecting importers with transporters, bypassing the traditional broker-mediated system. Beyond streamlined booking, the platform offers real-time cargo tracking and direct communication between importers and drivers, ensuring transparency throughout the journey.

Berhane foresees a digital freight ecosystem gradually coming into being as more freight forwarders and operators familiarize themselves with the platform. In addition, the Association does not plan to monetize it, as the service is available to its own members.

Ethiopia’s freight drivers and operators have been beset by a wave of challenges over the past few years partly stemming from attacks by armed groups. The integrity of the road logistics network has been threatened by kidnappings and killings of several drivers. Ensuring the safety of merchandise en route has become increasingly challenging for importers.

Bahru Zeru, General Manager of United Africa Logistics, says the new platform takes inspiration from similar services in the United States of America. The Company worked for half a year to ensure that the platform was user-friendly and suited to Ethiopia’s local context.

“Logistics has to digitize to keep up in pace,” the General Manager told Shega.

He says they have submitted the platform to the Ethiopian Maritime Authority to complement oversight of logistics operations under the Company. The number of trucks, size of cargo, and type of shipment is included in the documentation of the platform.

Legislative changes have also been brewing across the logistics sector, with the Ministry of Transport & Logistics demanding the commercialization of transport associations. Improving oversight, digitization, and updating licensing standards are also part of the ten-year logistics strategy.

Developers of the new platform hope to digitize aspects of the logistics network in line with the ten-year strategy. Bahru says improved communication channels and real-time tracking will bring about significant transparency and accountability to the sector. Ethiopia’s logistics sector is poised for significant transformation as the government opens it to foreigners, diversifies corridors, and entices private sector participation.