| Abstract: | The ability to transport goods quickly, economically and reliably is vital to a nation’s prosperity and capacity to compete in global market.Ethiopian logistics system is characterized by poor logistics management system and lack of coordination of good transport, low level of development of logistics infrastructure and inadequate fleets of freight vehicles in number and age, damage and quality deterioration of goods while handling, transporting and in storage. This coupled with lack of sea port resulted in poor market and non-competitiveness of Ethiopian goods on global market, which compromised livelihood of the people and economy of the country. Efficient and effective logistics system needs to be put in place to solve these socio-economic problems. The objective of this work is to assess the current status of logistics practices in Ethiopia with the aim of identifying the gaps, potentials and constraints for development of effective and efficient logistics system and trade competitiveness. To meet this objective, both qualitative and quantitative assessment of the components of freight logistics and transport companies, organizations dealing with documentation of import and export goods, Banks, inland dry ports, shipping organizations and customs authority are made. Information from both primary and secondary sources is used to carry out the assessment. Presence of road of high density and quality makes efficient distribution of goods easy. Customer orientation, low level bureaucracy at customs and trade facilitations expedite goods flow. Availability of skilled manpower, conducive labor regulations and business environment, co-ordination between institutions, development of ICT promotes economic activities. On most of these criteria, Ethiopian logistics system is found to be poor.There is urgent need for research on the problems, and the government needs to work on building the capacity of institutions and create the integration needed between them. It should also start to look other available port options so that to minimize the economic dependence and excessive cost incurred from Djibouti port. Furthermore usage of ICT, adaptation of modern logistics activities and investment on research on such issues should also be seen as a mechanism to improve the logistic performance and trade competitiveness of the country. |
