Ethiopia’s transportation networks and infrastructure is undergoing unprecedented levels of change and partnerships with private-sector companies and foreign governments are vital to hitting the country’s ambitious targets, as Minister of Transport Workneh Gebeyehu explains.
What is your opinion on the prominence Africa is gaining in the international arena?
Africa is now getting attention from different directions and not because of the problems that have been lingering in Africa in past years, but of the success stories that we are hearing here and there. The potential for development in Africa was there, it is still there and it will be there. We have a very young population – around 60% of the population is young – that is a big potential. We have a population of over a billion people and that means potential for development. We also have different resources, which we have not yet used. So now, and combining all these things, it is the time for Africa to slowly but surely become part of the world’s development. There are different signs of continuous developments in various countries and the young and educated labor is coming on board; slowly, Africa is rising.
At the IMF Africa Rising Conference, Christine Lagarde said the three key challenges for Africa are to build infrastructure, build institutions and build people. What are the challenges to train these people and to channel them into the productive sectors of the economy?
These three things are very important. If you want development you have to work on the infrastructure, so infrastructure should lead the development of a country and, in Africa and particularly here in my country, what we are doing is this. The basic challenge in this area is investment capital and finance. As you know, infrastructure needs a huge amount of money, which right now is not affordable for our national budget. We are in need of different partners who should work with us upon this area and we have been very successful in finding these partners from different countries and international organizations, which are really assisting us to develop our transport networks, energy sector and so on. The other challenge is educated human labor. These are the areas that we should work on very hard, so we can have our own educated and experienced labor force that can really lead the infrastructure of Africa and of Ethiopia.
The GTP made strides in creating road and rail infrastructure to connect Ethiopia with neighboring countries. What is the importance of this regional integration?
The development of a country cannot be confined by the borders of one country. Ethiopia is a big country, a big landlocked country, so we understand very well the importance of the interconnection of the regions in different sectors. Now we have connections with our neighboring countries, with Djibouti through the railway, and with Kenya we have a road connection, and also with Sudan and Somaliland. So it is a very important gateway to the world. The relationship with our neighbors and economic transactions between them is increasing a lot, because we are working not only to connect these regions by road, but also to connect them by railway and, also, we have good connections by air transport.
This regional connection is very important for our economy and for our people-to-people relationships, and also to create an economy that can assist the region’s people without any confinement in the given countries. We have a platform for that with different countries. COMESA is there, which is working to make connections among African countries. Really, we are working very hard but there are still things to be done for the future.
How will the new railway project ease trade and investment?
It will have a huge impact. One of the problems we are facing here in Ethiopia is the problem of transportation cost and time. The railway, which we are going to finish in about three or four months’ time, is a game changer. I can give you an example: we are transporting car cargo from Djibouti to Ethiopia in an average of three days’ time, that is how long it takes to load and unload here in Ethiopia or from Ethiopia to Djibouti. One train is now going to carry the equivalent to 16 big lorries and it’s going to make the journey from Djibouti to Ethiopia or from Ethiopia to Djibouti within eight hours. This means a lot for transport costs, because it increases the competitiveness of the country in international trade and it also attracts investors, which always complain because the cost of transport is high in Ethiopia. This railway will really change the game.
Ethiopia’s road network has more than tripled from 26,550km in 1997 to 99,522km today. However, it has to keep up with the needs of Ethiopia’s fast growth and economic transformation. How is the Ministry currently addressing the economy’s demand for roads?
The road sector is very important. It is of critical importance to connect the rural areas with the urban areas and also to connect the country’s economy with the outside world and to create a conducive situation for our farmers in terms of education, which is vital especially in developing countries. We are fully aware of that and we constructed very aggressively during the past five years. We have constructed more than 45,000 kilometers of rural roads and more than 500 kilometers of asphalt and concrete roads in the past five years. In total, we have around 114,000 kilometers of road in the country (Ethiopia is a very big country). Because we know how important roads are for the development of our economy, we are planning to double this length in the next five years with GTP II. We are planning to construct 100,000 kilometers in five years, which is going to equal what we have had for the past 90 years.
This is a very aggressive approach; it is a very tough job that we are preparing to do, because this sector should develop, this sector should change the country, the society. The economy of Ethiopia lies upon the development of roads, so we are investing around 30% of our national budget in this sector. It’s a big investment.
Ethiopia is known by worldly standards as one of the biggest investors in the road sector. These all means that there are real changes that will push forward our development and our economy.
How are you working from the Ministry in order to engage the private sector and foreign investors to collaborate with Ethiopia’s ambitious goals?
Yes, capital finance is very important and our economy is not generating that capital, even though we are working towards that in different areas. But we cannot finance these huge megaprojects with our national budget.
We need partners from the private sector to come and participate in the development of Ethiopia; the private sector is playing a great role in the infrastructure sector and in the transport sector.
The others are international partners, countries like China, Japan, Turkey, the UK, European Union, the US, the World Bank, and the Africa Development Bank, and so on and so forth. These countries are working very closely with Ethiopia. They are all our partners in the transport and infrastructure sectors and have assisted us a lot so that we may be able to achieve our goal.
Most of the projects you are seeing around here now are the result of works done in collaboration with these friendly counties and international organizations.
Do you also have any plans regarding the ease of doing business to facilitate investment in the transport sector?
We have not yet identified a problem of a legal nature; we have not seen it as a bottleneck. We are very comfortable because the structure that we are working with now is very comfortable; we are very successful. We are not looking to change any of our rules or regulations because we are working with our partners very comfortably, but we will see for the future what is going to happen. If there were any bottlenecks we would see to them and we would change what is necessary.
For now, we don’t have a problem in the airport and airline sector, we have one of the biggest airlines in Africa, it is very competitive. We also have an important participation of the private sector inside the country; over nine or 10 operators are currently working here. The involvement of the government is very big, but private partners also hold a significant role, which is going to develop in time.
Founded in 1945, Ethiopian Airlines is one of Africa’s big success stories and Ethiopia’s flagship company. What do you think Ethiopian Airlines means for Ethiopians in particular and Africans in general?
Yes, for the last 60 years Ethiopian Airlines has been working for Africans, not only for Ethiopians. The motto of Ethiopian Airlines was and is ‘Connecting Africa’, as it is very difficult to connect Africa by road or by railway, because of the terrain, the vegetation and so on. So, really, Ethiopian Airlines was connecting African countries and bringing the African people together. This is one thing that we are always proud of, besides the business that we are doing. It is a very successful airline and it is competing in this merciless environment, because it is the only airline which is competing –and winning– in the aviation sector.
As you know, competition is very tough. Ethiopian Airlines is not subsidized by the government; it is self reliable and it is working well. So yes, it is the flagship of this country. It is a very successful company, not only here in Africa but also in the world. We are connecting Africa, so it is our way of communicating with our African brothers and even with the world.
Can you please outline the collaboration between the government and the key state-owned enterprises (SOEs)?
In the Ministry of Transport, the key SOEs are Ethiopian Airlines, the Ethiopian Shipping and Logistics Enterprise, the Ethiopian Airports Enterprise, and also there is the Public Toll Road Enterprise and the Ethiopian Road Authority. These are some of the public companies that are significantly assisting the economy of the country.
For example, if you take Ethiopian Shipping and Logistics Enterprise, which is the only government-owned shipping logistics enterprise in sub-Saharan Africa. Of course it’s successful. The shipping line business is very competitive and very difficult to manage by governments, but these are strategic enterprises for the economy of this country.
With Ethiopian Airports Enterprise we are selecting the areas that the government should interfere in and construct airports in the country. These are strategic tools for us to implement our policies and strategies.
Ethiopia aims to become Africa’s aviation hub and has ambitious plans regarding airports. Bole International Airport is currently under expansion and a mega airport, which will be the biggest in Africa and is expected to seat 120 million passengers a year, will start construction soon. What is the need you noticed for these projects, and how will they impact not only the region, but also Africa in general?
Number one, the location. We are located in a strategic place, because we are connecting Africa with the Middle East and with Europe. At the same time, this country is a big country compared to other African countries. We have a population of around 100 million and, also, we are the political capital of Africa. That’s why we need airports that are fit for these purposes that I have mentioned. That’s why the government is planning to build the biggest airport, which is going to carry around 100 million passengers per year. Now, we are hosting only eight million, but the project is very big and we are expanding this existing airport with a $300 million capital investment. That is really one of the biggest projects that we have ever had in the country. We deserve to have an airport with such capacity because we are now leading the aviation sector in Africa. Also, the strategic location pushes us to have this type of airport and the economy itself is pushing us to have such kinds of airports.
What message would you like to convey to the international community about the road sector and general transport infrastructure in Ethiopia?
In Ethiopia we are just now building the infrastructure. We have still a lot of things to do. Yes, we are beginning, so the international partners in Europe are well experienced in terms of knowledge and in terms of performance. We are always calling our friends from Europe to come and to participate in this very aggressive plan that we have already laid out. Definitely we are getting assistance in different areas from our partners. We need the skills, the knowledge and at the same time the finance itself. The most important thing is working together with our partners, especially in Europe, who will assist us a lot. The European Union was working with us. The United Kingdom is working with Ethiopia; it’s one of the biggest budget supports for our country; it is truly assisting the county to move forward.
You have been Minister of Transport for two and a half years, what you would like to leave behind once you leave office?
I’m finishing my PhD, so I want to work in universities if I finish my term here. My dream is, after I have the experience and the education, to work in the universities. That is my dream. I want to share my knowledge and experience.