Ethiopia: Delays in New Flower Shipping Service As Competitors Fume

Ethiopia: Delays in New Flower Shipping Service As Competitors Fume

Addis Fortune (Addis Ababa)

October 17, 2006
Posted to the web October 17, 2006
Issayas Mekuria


Amid local furore over its plans to start its own air shipment service, the Boeing 747 airplane leased by Sher Ethiopia Plc for the transportation of flower cargo from Ethiopia to Europe did not arrive on Tuesday, October 10, 2006 as previously planned by the Company.

Sher Ethiopia, a flower farming company, was established by a group of Dutch investors, which are currently working on 450ht of land around Ziway, 163km from Addis Abeba. On September 26, the company sent out e-mails to 77 companies working in the floriculture sector, announcing that it would be bringing a plane to transport flower freight from Addis Abeba to Belgium twice a week. The freight plane was leased from the Dutch company, Laudan Airways.

A member from the management of Sher Ethiopia told Fortune last week that although the Dutch airline had intended for the plane to arrive in Addis on October 5, it postponed the arrival to Tuesday. But even by then, the plane had still not made its way to Ethiopia.

Another member of Sher Ethiopia management told Fortune that the reason for the delay was due to internal procedures that the company needed to resolve. He was unwilling to reveal what these procedures were.

Sher's intention to lease a plane to carry flower freight was received with resistance from Ethio-Horti Share Company, a flower shipping broker established by 30 flower exporters, and the Ethiopian Horticulture Producers and Exporters Association.

"It is not fair that now that flower export has become a successful business, this company wants to transport flower cargos for us. The Ethiopian government has given the sector much support and Ethiopian Airlines was shipping our goods at a loss when the sector was struggling to make it,' said Solomon Sebhatu, board chairperson of Ethio-Horti Share Company.

He told Fortune that Sher Ethiopia required flower exporters to pay for the service in foreign currency, which would be unbeneficial to the country. Consequently, said Solomon, the Airways should not be allowed to enter the flower shipment business.

Various flower companies involved with Ethio-Horti have made their displeasure very known to Sher Ethiopia through emails, copies of which were forwarded to Fortune. The emails clearly express a desire to reward and defend Ethio-horti Share and Ethiopian Airlines for their patience and efforts in the early birth pangs of the flower business, many years before Sher Ethiopia arrived on the scene.

"I wish you were here with us a few years back when we left part of our products at the airport," wrote Lemlem Sissay (Ph.D), managing director of Oda Flowers Plc, in one of the emails addressed to Joost Van Klink, Sher Ethiopia co-owner, describing tougher times.

According to the original Sher email, the first air freight was to take place on October 5, the second on October 7 and the third on October 10 and that the same three-flight-a-week schedule would be repeated from there on. The planes were to pick up flower freights from Kenya and pass through Ethiopia to pick up more cargo.

However, the Civil Aviation Authority had explained that the Airways would only be allowed to transport flower cargo for the month of October. According to the Authority, the permission was given due to the great volume of flowers that were expected to be exported during this month and the concern that there would be gap that could not be filled by Ethiopian Airlines alone.

"We know nothing about being given just one month," said a Sher staff member. "We see no reason why we should not be allowed to transport flowers like any other freight company."

In the past six years, the Ethiopian government - which has been strongly encouraging the expansion of the flower sector - made 20 million euros from flower and vegetable exports. The government hopes to make 40 to 50 million euros in the sector this year.

Ethiopian Airlines has responded to the boom in the flower export sector by turning one of its Boeing 757 passenger aircrafts into a cargo plane. The modified Boeing was put to use last week. In addition, the Airline has announced that it will be leasing an MD 11 airplane, capable of carrying up to 85tn.

The email from Sher claimed that the decision to provide a service was taken because of an urgent need to provide for cargo space, especially during peak season. "As we all experienced, there are a lot of problems with air freight from Addis, therefore we like to start our own operation," the E-mail stated.

Now, Sher Ethiopia concedes that perhaps Ethiopian Airlines can fill in the void without their intervention. "If Ethiopian Airlines is fully capable of transporting flower cargos, then maybe we will not have to bring in the plane after all," a staff member of Sher Ethiopia said.