Modjo Dry Port Flicks Switch to Release Solar Products

After waiting for two months, solar panel materials imported by eight companies were released by order of the Ministry of Trade (MoT) without any standard customs clearance procedures.

The Modjo Dry Port cleared 20 containers carrying imported solar panel materials without following the usual modus operandi, after an order from MoT. This order cited a letter it received on June 30, 2016, from the the Ministry of Water, Irrigation and Electricity (MoWIE) underscoring its urgent need for these products as early as possible for its ongoing rural solar electrification projects.

The solar panel materials in question are required to implement the Lighting Africa Rural Electricity Project in Ethiopia, with a 20-million-dollar fund secured from the World Bank (WB).

“We received a letter from the MoWIE three time demanding immediate release,” said Yared Befikadu, Import and Export Commodity inspection director at the MoT.

The letter makes reference to the MoT’s decision passed three months earlier, which declared void third party certificates for clearance, demanding it to reverse and allow these products to be released without undergoing the Ethiopian Conformity Assessment Enterprise’s (ECAE) tests. The compulsory standards set for solar materials pertain to criteria in lighting source, battery, internal electronics and dynamo capacity.

The eight companies that imported the products are Vera International Trading, Universal Electrics, Uni-Sound General Business Plc, LYDTCO Trading, Tigist Tadesse Import, Dama Trading, Rensis Engineering and Trading Plc and Ethio-Trading Agency.

The MoT issued a letter to the Modjo Customs Office with instructions for the immediate clearance of the specified shipment. Subsequently, the containers were cleared by July 7, 2016 – six days after the port received the letter.

These containers were cleared from the dry port with third party certificates issued by SGS, an international certification firm, reversing customs rules.

Under normal circumstances, the Port Authority clears goods following strict procedures, involving lab tests by the ECAE against standards set by the Ethiopian Standards Agency (ESA).

“We cleared at the Ministry’s order, and we have to abide by the written order,” said Ayele Worku, the port’s office head. “We hold them until we check against set standards,” he added.

“The MoWIE agreed to take full responsibility if the products turn out to be below standard,” Yared noted. However, the Ministry claims it has made no such agreement.

“We did not agree to pay for a damage that may occur as a result of poor standards,” Asres Woldegiorigis, Alternative Energy Technology Development and Promotion Department director at the Ministry, told Fortune.

“We need the products for rural electrification projects in the least developed regions such as Afar, Benshangul-Gumuz, Gambella and Somali.

A memorandum of understanding (MoU) has been signed with eight importers to import products of high quality, he underscored. Asres also noted that a letter of cooperation was written to the MoT to allow the eight importers to clear their goods sooner. The importers have agreed to provide a two-year warranty for their products.

“We signed an agreement with the MoWIE to import quality products three years ago,” said Adane Woldemicael, manager of Tigist Tadesse import one of the eight company.”We are also agreed to give a two-year warranty to farmers who buy our products.”

“Our 21 containers were stored for 80 days, during which time we pay more for demurrage,” he added. “We appeal for the two Ministries to facilitate the clearance.”

Transportation and customs clearance takes a long time, which puts the solar rural electrification project in languishing progress, Adane noted.

The imports are intended to supply an electrification project launched in 2014 and set to be concluded in December 2016. The off-grid solar electrification campaign aims to reach two million beneficiaries in rural Ethiopia.

The extraordinary customs clearance attributed to the 20 containers goes directly against what Yacob Yala, Minister of Trade, promised to the Parliamentarians in his nine-month report. A third party certification would no longer be effective from last March, he told Parliament, after he was criticised by the general auditor over the clearance of sub-standard goods from dry ports.

“The ECAE has limited capacity of sample checking, which makes us clear without check,” Yared argued, shifting the blame away from the Ministry.

“We take three samples at a time and we get the result after four weeks,” Tekie Berhane, the ECAE’s marketing and corporate communications head, told Fortune. “Processing the sample of solar panels is difficult in this rainy season, as sun will be one input we need to know the quality of the solar materials.”

The number of solar lanterns in Ethiopia has been increasing by 90pc annually, with 16 million dollars worth of lantern products imported last year alone, representing a 64pc rise from the previous year. In the first four months of the current fiscal year, five million dollars worth of solar lanterns have been imported.

These commodities are needed for the second Growth and Transformation Plan’s (GTPII) rural electrification projects across the country. During the GTPII, which began in 2016, Ethiopia has plans to distribute 3.6 million lantern solar systems and 400,000 solar house systems. So far, 8,000 solar house systems have been distributed this year.

In the years between 2014 and 2015, Kenya accounted for 30pc of Africa’s solar product sales, while Ethiopia and Tanzania shared another third together.

 

 


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