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How did Ethiopia Settle a $1.2B Railway Dispute for $213 Million?

BBC · 3 hours ago · Read the Full Story on BBC
How did Ethiopia Settle a $1.2B Railway Dispute for $213 Million?
AI SUMMARY

The London Court of International Arbitration has ordered Ethiopia to pay $213.7 million in net compensation to Turkish contractor Yapi Merkezi, resolving a long-standing $1.2 billion dispute over the Awash-Kombolcha-Hara Gebeya railway project.

  • The London Court of International Arbitration concluded a four-year legal dispute regarding the Awash-Kombolcha-Hara Gebeya railway project.
  • Turkish contractor Yapi Merkezi had originally sought over $1.2 billion in damages, including interest, citing delays, destruction, and looting.
  • The court ruled that Ethiopia must pay a net compensation of $213.7 million, plus a nine percent annual interest rate from the filing date until payment.
  • Damages sustained during the war in northern Ethiopia account for 36.7 percent of the awarded compensation.
  • Other portions of the award include 31.6 percent for construction delays, 27.7 percent for unpaid invoices, and 3.8 percent for lost profits.
  • Ownership of approximately 1,500 vehicles and equipment previously reported as damaged or looted will be transferred to the Ethiopian Railways Corporation.
  • The Ethiopian Railways Corporation successfully limited the lawsuit to itself, protecting the Ministry of Transport and the Ministry of Finance from asset seizure.
  • The 392-kilometer railway project had reached 92 percent completion before it was suspended in 2021 due to the conflict.
  • The Ethiopian Railways Corporation resumed construction using its own capacity in May 2026 and estimates it will take two years to complete.
Read the Full Story on BBC
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