Chinese-built Ethiopia-Djibouti railway will officially open service on Wednesday to become Africa’s first electric railway. The 752-km railway links the Ethiopian capital Addis Ababa and the port of Djibouti in the Gulf of Aden country Djibouti. It will offer both passenger and freight services, although the operations will be freight-only at the outset.  This represents a significant economic development advancement for the greater region.

Prior to the project, there was no modern railway in Ethiopia or Djibouti. The railway is capable of slashing travel time between Addis Ababa and Djibouti from 7 days on roads to about 10 hours. It also provides landlocked Ethiopia with a faster access to the port in Djibouti. There have been expectations for the railway to boost industrialization along its route.  This infrastructure investment is an enormous step forward for Ethiopia and provides it and other landlocked central African markets to seaport access in Djibouti and onward through the Red Sea and Suez Canal and out from Gulf of Aden.  There are huge expectations for job growth and economic investment – and this is likely an excellent case of logistics infrastructure enabling economic growth.  We think that this probably represents a good example for other countries for how to match infrastructure risk capital to economic development.

The majority of the railway is located in the Horn of Africa country Ethiopia. A large difference in land elevation along the route was a major technological challenge, contributing to the project’s significant cost.  The railway is the continent’s first electric railway, which powers the trains through overhead wires. Compared with locomotives that burns diesel, the electric trains boast powerful traction and are more environmentally friendly.

The railway has a designed speed of 120 km per hour, which doesn’t favorably compare to countries with high-speed systems, but the current design proved cost-effective for Ethiopia and Djibouti given their industrial levels and freight volumes.

At a total investment of $4B, the line was constructed by China Railway Group and China Civil Engineering Construction Corporation, two state-owned companies of China. It is the first railway built using complete sets of Chinese equipment and standards outside China.  he railway is also the second trans-national railway built by Chinese firms in Africa, following the Tazara railway, which links Tanzania’s Dar es Salaam with Zambia’s Kapiri Mposhi. During a visit to Ethiopia in May 2013, Chinese Vice Premier Wang Yang hailed the Ethiopia-Djibouti railway as the “Tazara railway in a new era.”

The railway will be managed by a consortium of Chinese companies for about six years given the lack of railway-related personnel in the two countries. The Chinese management is also commissioned to train local stewards, drivers and technicians, creating thousands of new jobs and nurturing railway expertise for the two African countries

 

Ethiopia Opens New Rail Line to Djibouti in Industrial Drive  (Reuters)

Ethiopia opened a new train line on Wednesday linking its land-locked capital to the Red Sea state of Djibouti, part of Addis Ababa’s infrastructure program aimed at turning the poor, agrarian nation into an industrial hub.

Ethiopia’s economy is one of the fastest growing in Africa, even though it has suffered a severe drought for at least the past two years. Growth has been fueled by construction of railways, roads and hydro-electric dams to power industry.

Ethiopian Railways Corporation spokesman Dereje Tefera said the $4 billion, Chinese-built 750-km (470-mile) electrified line “will minimize the cost of the transport and the transport time and it’s free from pollution, it uses renewable energy.”

“It’s part of the trans-African railway network so it will give an opportunity for connecting Ethiopia with other neighboring countries,” Dereje said of the line which will be operated by Chinese workers until Ethiopians are trained.

Ethiopia’s economic development has long been hampered by poor roads and an aging fleet of trucks, which ply the route between the industrial heartlands in the center of the country and Djibouti, Ethiopia’s main import and export route.

The government is facing a wave of protests, often involving clashes with police, over land rights and other political issues. Locals say the authorities grab land for new industry but offer them little compensation.