Ethiopian Business Review

Too Many Cars Spoil the Roads Featured

If you’ve ever driven or walked around Addis Ababa, it’s quite clear that the roads are congested and the traffic can be, at times, pretty bad. That’s because there’s been a rather large influx of cars coming into the country – thousands per year, by some estimates. As more and more Ethiopians are gaining access to increasing amounts of money, some are purchasing cars in order to make life and doing business easier. But what are the implications of this trend? EBR’s Berihun Mekonnen spoke with drivers and government officials about the issue.

Before September 2011, the total number of cars with a code two license plate in Addis Ababa, which denotes a vehicle used for personal use, was no more than 100,000. In the past three years, however, close to 48,000 cars with code two plates have joined the roads of Addis Ababa. The total number of all kinds of vehicles registered under the ownership of city dwellers has now surpassed the 400,000 mark. 

It’s been noted that the rapid growth of cars to the roads of Addis Ababa has its own social, economic and environmental effects - both negative and positive.

According to 2007 World Bank data, the ratio of motor vehicles to people in Ethiopia was one of the lowest, at three motor vehicles for every 1,000 individuals and one passenger car per 1,000 people. The number of vehicles per km of road was only five.  This is considered low, even by sub-Saharan Africa standards. Sudan, for example, had 34 motor vehicles per 1,000 persons, while Tanzania and Uganda had seven in the same year. Kenya had 25 motor vehicles per 1,000 persons, according to data from 2011.

Though it is difficult to find recent data about this ratio in Ethiopia, the increasing number of cars entering the country, it’s safe to assume, will have an effect on the ratio. But it certainly has changed the picture in Addis Ababa – a city that is used to managing a small car-to-human ratio. Based on calculating the data found at the Ethiopian Transport Authority, there are close to 100 motor vehicles for every 1,000 people living in the capital. 

The increase in vehicles on the roads has changed the lifestyles of people, especially in Addis Ababa.  A few years ago, for many people, cars were considered a luxury item, a symbol of high class status. These days, however with the expansion of the middle class, many consider cars a basic necessity. They are now regarded as the means to facilitate businesses and ease everyday activities and transactions, like commuting to work or delivering goods to consumers. 

“Especially if you earn your living doing business, moving here and there, owning a car is a must,” says Brook Kidande, a freelance consultant who performs IT installation for businesses and offices. “I bought myself a car, borrowing half of the money from my family, simply because it is essential for doing my job,” he told EBR.

It has increasingly become a reality that the urban professional middle classes, especially those with disposable income, and people engaged in medium-scale commercial activities, own cars. “The demand for cars is usually taken as a good indicator of the emerging middle class,” says Biniam Bedaso (PhD), an economist who works as a researcher. 

With the emerging middle class and economic boom, cars are used as tools to ease business transactions and compensate for public transportation systems.  The latter point highlights the lack of convenient public transport, which many now remedy by purchasing a car, in large part because their incomes allow for it.

Cars are also considered by many to be a mechanism for asset accumulation. The skyrocketing inflation of the past few years has made some believe that buying vehicles is a sound way of asset accumulation. This is because cars are generally considered to have low deprecation rates and can even gain monetary value over time.

Perhaps more than other forms of ownership, vehicle ownership is a good indicator of class transcendence in Ethiopia. Homeownership is considered to be one of the best indicators of emerging middle class growth and asset accumulation in many developing countries. Yet homes are expensive in Ethiopia, particularly in Addis Ababa. “Since the housing market is highly distorted in Ethiopia, with an imperfect land market, the only viable option to store value for many middle class folks is through buying cars,” says Biniam.  

But despite the fact that cars show the promising growth of wealth among Ethiopians, the reality on the roads is a little grimmer, since drivers say congestion is becoming worse in the city. Drivers say that the problem of congestion and traffic is only made worse by the various construction projects taking place throughout Addis Ababa, including the construction of the light rail transit system (LRT). 

Road coverage of the city has grown from 7.4Pct seven years ago in 2005/6 to 17.5Pct currently, with plans to reach the standard 25Pct of the total area of the city by 2020. As of June 2014, there are 4,716km of roads in Addis Ababa, of which more than 2,255km is comprised of seven meter-wide asphalt roads. Despite this growth, however, traffic jams in many parts of the city and bottlenecks at roundabouts and traffic lights have become a daily challenge for drivers. 

Despite ongoing construction, many still feel the number of cars on the roads is the main factor contributing to road congestion.  “There aren’t enough roads for the cars coming to the country, particularly to Addis Ababa,” says Kamil Ahmed, whom EBR spoke to on African Avenue while driving in a congested traffic jam. Many drivers and car owners EBR approached expressed similar sentiments.

But, according to Fekadu Haile (Engineer), general manager of the Addis Ababa Roads Authority, though it is a fact that the number of cars coming to the city is increasing, the traffic jams are caused by the construction projects in many parts of the city and poor traffic management.  “For the time being, the roads available are enough for the cars the city has,” Fekadu told EBR. 

Projects like the LRT and road construction throughout the city hinder traffic flow in areas like Meskel Square, Mexico and Megenagna. “They will be completed in a few years time, but the lack of efficient traffic management systems has exacerbated the problem,” he adds. 

Officials at the Addis Ababa Transport Authority make a similar argument. The number of cars in the city compared to other neighboring countries is still small, says Genet Dibaba, public relations director at the Authority. The current traffic jams are temporary challenges caused by the construction projects in many parts of the city. Though it is true that the increasing number of cars takes its own toll, the completion of the LRT should solve the traffic concerns, according to Genet.

To be sure, the popularity of cars among Ethiopians has been good for businesses, especially importers and manufacturers. Many of the cars on the streets are used cars imported from the Middle East and Europe. Several car assembly factories have also been established in the country and locally-assembled cars and brand new cars imported directly from manufacturers are also becoming popular among drivers. 

Still, the government has a long-term plan to minimize and impede the import of used cars.  According to the Ministry of Transport, the work has already started and it`s working to ensure these efforts are maintained. 

With regard to public transport vehicles, the government is also working to lessen their impact on traffic in Addis Ababa. The government has established standards to regulate these vehicles based on their safety, age and comfort. These standards are judged using ‘levels’ (from one to three) as a metric for gauging the extent to which cars meet these standards. Cars with better ratings (those that are safer, for example) are allowed to collect higher transport fares from passengers. Those vehicles that don’t satisfy the standards will not be allowed to provide services at all.  

Because different levels have different tariff rates, people usually want to have the best levels possible. It has increased competition among service providers and it has resulted in better service for customers, according to officials. Many have been improving the technical, safety and comfort of their vehicles while many others are also importing newer vehicles. 

The imposition of standards through ‘levels’ has also begun on trucks. Many truck owners are forming share companies to strengthen their capacities to fulfill the necessary requirements and be competitive enough.

Yet, many note that vehicles entering Ethiopia isn’t good, especially with regard to the safety of the country’s residents. Ethiopia is one of the most road accident-prone countries in the world. Car accidents are so high that death by accidents is a fairly common occurrence in the country. Though the main source of road accident is drivers’ recklessness, according to Inspector Assefa Mezgebu, the increase of vehicles will likely increase road accidents.

To that end, the government says it’s doing what it can to quell the adverse safety hazards that come from too many cars on the roads. A Ministry of Transport senior official, who spoke to EBR on the condition of anonymity, says one of the plans in the current budget year is to pass a proclamation on the age limit of vehicles that are imported to the country. There will be discouraging packages for the importing of old vehicles, he told EBR. This, they hope, will do more to lessen the amount of cars on the roads without doing too much to damage the benefits vehicles may confer to owners.

Berihun Mekonnen

EBR Staff Writter

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