CONTRIBUTION OF MULTIMODAL TRANSPORT OPERATION SYSTEM TO PERFORMANCE OF ETHIOPIAN SHIPPING AND LOGISTICS SERVICES ENTERPRISE

Abstract

The multimodal system is an optimization process of the location, movement and storage of resources from the point of origin, through various economic activities, to the final consumer. The practices and developments trying to maximize or optimize the benefits of multimodal transport system vary in different parts of the world. In Ethiopia Multimodal Transport is considered as solution’s for coastal access to Djibouti port, import and export, technology transfer, infrastructure development, employment opportunity, development of other sector, human capital, and others but much is not done physically on the ground. The objective of the study was to assess the contribution of MTOS with the aim of identifying the key benefits, potentials and constraints for optimization of its benefits for development of effective and efficient logistics system and trade competitiveness. To meet this objective, descriptive research methodology was applied and qualitative and quantitative assessments were made. Information from primary and secondary sources was used to carry out the assessment through interview, observation and questioners. The key identified contributions are combined state and private transport to solve import cargo mobility, employment and income opportunity to citizens, support foreign direct investors and improved financial performance of AEO, save foreign currency, decrease demurrage cost, Source of income, expand dry port and performance and improved cargo transport operation and reduced handling cost. The major factors that hinder operation of multimodal transport operations are foreign currency problem, lack of modern ICT and transportation infrastructure in size and number, lack of competent professionals in the organization, lack of good governance and absence of competition. The study suggests that in order to improve the services of MTS encourage competition between private operators and the ESLSE, the government or Ethiopian Maritime Affairs Authority is recommended to produce the possible new law or/and proclamation which requires private potential MMT Operators to be established at the national level for developing and maintaining competitive advantage.