Ethiopia launches a Single Window system and announces liberalization of logistics services

The Government of Ethiopia has launched an electronic platform called “Ethiopia Electronic Single Window Service“ that will enhance efficiency in trade logistics landscape of the country by speeding the customs process for importers and exporters.

According to United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT), a Single Window is a facility (usually an electronic platform) that allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfill all import, export and transit-related regulatory requirements. Its main aim is to simplify regulatory formalities and reduce operating costs for traders, by avoiding them to submit redundant information and data to all the actors involved in cross-border operations. Essentially, instead of multiple documentary transmissions, traders can lodge to an electronic platform a single package of data containing all the information regarding their customs transactions, so that such data will be automatically distributed by the platform to all such actors, both for regulatory purposes (e.g. Customs, and other government authorities or inspection agencies, chambers of commerce, etc.) and for commercial, logistics or financial reasons (e.g. banks, insurances, forwarding agents, customs brokers, independent inspection companies, etc.).

The principle behind the SW systems is therefore the reusability of the same data to comply with multiple regulatory requirements of both private and public agencies that are active in the international trade sector, and that are interconnected to the electronic platform.

Ethiopia started its single window project in 2017 with a financing of the World Bank Group. The project's objective was to connect about 40 government agencies and private entities involved in the logistic value chain, like as the Ethiopian Revenues & Customs Authority (ERCA), the Ministry of Finance & Economic Cooperation, the Ministry of Trade, the Ministry of Industry, the Federal Transport Authority, the Ministry of Agriculture & Natural Resource, and several national banks/insurance companies. A national committee chaired by the Prime Minister was also established to oversee the project and a project office was created to guide its implementation, drawing on the experience of the of the “Uni-Pass” system developed by the South Korea Customs Service (KCS), which signed on 3 March 2017 a Memorandum of Understanding with ERCA for assisting Ethiopia in the development and implementation of its single window. A few years before, with the Customs Proclamation No. 859/2014 (which repealed the previous Customs Proclamation No. 622/2009), the Ethiopian government introduced the legal basis of such a system, by setting out some provisions allowing traders to finalize customs procedures using minimum available documentation and electronically-transmitted documents.

The Doing Business 2020 report of the World Bank indicates an average time of 72 hours for importing, and of 52 hours for exporting goods from Ethiopia. But even more astonishingly, the report estimates in 76 and in 194 hours the average time needed to traders for preparing, respectively, the export and import documentation.

It is expected that the new system will drastically reduce such a long paper work process for importers and exporters initially to 15 days and eventually to 3 working days. A pilot project with 16 Ethiopian companies, both private and state-owned, is set to begin soon to test the Single Window.

Apart from facilitating the customs procedures through the exploitation of ICT technologies, the government has recently announced the liberalization of the logistics sector (a sector which is one among the most regulated in the country and partially restricted to foreign investors), by further opening it to foreign companies and investors. In September 2018 the Ethiopia's Investment Board, established by Council of Ministers Regulation No. 313/2114 and presided by the Prime Minister, adopted a decision that allows foreign investment up to 49% in the Ethiopian logistics industry (notably: packaging, forwarding and shipping agency services, including the provision of bonded warehouse, consolidation and de-consolidation services), but exclusively through the establishment of joint ventures. Previously, the Investment Regulation No. 270/2012, art. 3(b) (Council of Ministers Regulation on investment incentives and investment areas reserved for domestic investors) restricted Logistics Services exclusively to Ethiopian nationals.

The Ethiopian Single Window is accessible here.