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The reaction from the Ethiopian government was
prompt, revealing the gravity of the matter; Girma
Birru, minister of Trade and Industry, left for
Djibouti last Wednesday, July 9, in order to
persuade Djiboutian authorities to reconsider the
tariff adjustment announced last week by DP
World-Djibouti. He stayed there for a night, and met
Ismael Omar Guelleh, president of Djibouti.
DP World, a management company in charge of running
the port’s operation, said last week it will apply
new set of tariff rates in all services at the Port,
beginning mid-August 2008. in effect, this will have
an increase of 15pc on container handling and
stevedoring, as well as reduce the free storage
period from 15 to eight days, two of the most
critical areas for Ethiopia’s import and export
businesses.
The port’s management has attributed the increase on
various forms of port dues to a soaring cost on
fuel, increased by 350pc, and headline inflation of
19.2pc in Djibouti, as well as additional investment
in acquiring equipment.
Authorities here were not happy because they felt
Djibouti failed on its promises of communicating its
intention to adjust tariffs two months in advance.
“I didn’t expect them issue announcement for
distribution here and in Djibouti,” said a senior
negotiator for the Ethiopian government. “They ought
to send us the adjusted prices, together with a
covering letter inviting us for discussion.”
It was this sort of
discussion held between Minister Girma and President
Guelleh last week. The President has assured Girma
that his government would not let the new tariff
applied on Ethiopia before agreements are reached on
adjusted prices, reliable sources disclosed to
Fortune.
A
trade delegation will soon travel to Djibouti to
negotiate the proposed increase on tariffs, after a
technical committee under the auspices of the
Ministry of Trade and Industry (MoTI), formed two
weeks ago, finalize its impact assessment. The
committee comprises members from four federal
agencies: the Ministry, Customs Authority, Maritime
Transit Enterprise (MTS) and the Ethiopian Shipping
Lines (ESL).
“We have got a pretty good idea about how much
additional burden this would put on our economy,”
said a member of this committee.
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